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October 10 2017 - 10:05AM
Dow Jones News
Microsoft Corp. MSFT +1.61% unveiled a broad reorganization
Thursday, aiming to break down barriers between its internal units
and potential partners outside the company.
The long-expected set of moves announced by Chief Executive
Steve Ballmer strips away a structure based around divisions
overseeing particular products, such as Microsoft Windows, the Xbox
videogame console or the Office bundle of workplace software. In
its place, Microsoft is imposing a horizontal scheme with managers
that oversee different kinds of functions -- like engineering,
marketing and finance -- that would be applied to multiple product
lines.
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Mr. Ballmer said the move is designed to make sure that the
company runs "holistically, not as a set of islands."
The company's product-focused units have been known for
sometimes acting at cross-purposes, competing for resources and not
sharing technologies or moving as quickly as possible. Mr. Ballmer,
in a memo to employees, acknowledged that such problems can no
longer be tolerated as Microsoft scrambles to catch up in
technology trends such as mobile devices and so-called "cloud"
offerings.
"We must have a clear strategic direction but also empower
employees closest to the customer to make decisions in service of
the larger mission," Mr. Ballmer said in his memo.
Read More
Highlights: Ballmer's Reorganization Memo
Ballmer's Full Memo to Employees
This isn't the first time Microsoft has reshuffled the corporate
organization. But the latest set of moves is particularly sweeping,
reaching virtually every part of the company.
"This is a big undertaking," Mr. Ballmer said. "It touches
nearly every piece of what we do and how we work."
The Redmond, Wash., company said its product engineering will be
split into five parts, including one combining Windows for
computers and smartphones, which had been in separate product
divisions; a group for hardware engineering for computers, and for
the Xbox; and an engineering group for Microsoft's back-end
technologies for corporations and software developers.
Microsoft also announced new roles for several executives. Tony
Bates, who had been in charge of Microsoft's Skype digital-calling
service, has been appointed to head business development and
"evangelism."
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Julie Larson-Green, the head of Windows engineering since last
fall, now will lead the group overseeing devices like the Surface
tablet computer and Xbox. Terry Myerson, who had previously
overseen Microsoft's Windows Phone efforts, will now also oversee
all engineering for operating systems for personal computers,
mobile devices, videogame consoles and back-end systems.
Qi Lu was named head of the company's engineering for
applications and services. Satya Nadella, another prominent
Microsoft executive, will lead development of back-end technologies
for data centers -- including their construction and operation --
and related technologies such as databases, the company said.
Microsoft said Kurt DelBene, who had been in charge of Microsoft
Office, would retire.
Analysts said the moves could help improve internal
collaboration at the company. "The first thing I expect is a more
collaborative and unified Microsoft," said Patrick Moorhead, who
heads the market research firm Moor Insights & Strategy. "What
this translates to is a much more unified experience between the
phone, tablet, PC, and Xbox."
Broad outlines of the reorganization had been previously
reported by news organizations that include AllThingsD. The online
publication, like The Wall Street Journal, is owned by News Corp
NWSA -0.52% .
(END) Dow Jones Newswires
October 10, 2017 09:50 ET (13:50 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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