Is Microsoft’s Steve Ballmer really America’s worst CEO?

Microsoft CEO Steve Ballmer in January. (Microsoft photo)

It’s easy to criticize Steve Ballmer’s tenure as CEO of Microsoft. The stagnant share price, the Windows Vista debacle, the huge missed opportunities in tablets and smartphones.

But is it fair to call him “the worst CEO of a large publicly traded American company today”?

That’s the assessment of business consultant Adam Hartung, a Forbes contributor who puts Ballmer at the top of his list of CEOs who should have been fired long ago.

Hartung writes, “Without a doubt, Mr. Ballmer is the worst CEO of a large publicly traded American company today. Not only has he singlehandedly steered Microsoft out of some of the fastest growing and most lucrative tech markets (mobile music, handsets and tablets) but in the process he has sacrificed the growth and profits of not only his company but ‘ecosystem’ companies such as Dell, Hewlett Packard and even Nokia.  The reach of his bad leadership has extended far beyond Microsoft when it comes to destroying shareholder value – and jobs.”

He continues, “By Mr. Ballmer’s own admission Vista had over 200 man-years too much cost, and its launch, years late, met users avoiding upgrades. Microsoft 7 and Office 2012 did nothing to excite tech users, in corporations or at home, as Apple took the leadership position in personal technology.”

And he concludes, “Microsoft is still the same company Mr. Ballmer took control over a decade ago.  Microsoft is (a) PC company, nothing more, as demand for PCs shifts to mobile.”

The biggest hole in Hartung’s argument is that he doesn’t acknowledge Microsoft’s successes during Ballmer’s tenure, including the rise of SharePoint, and the continued growth of core products such as Microsoft Office, SQL Server and Windows Server. More glaring is his omission of the Xbox business, which has given Microsoft a large foothold in the living room, putting the company in an enviable position as one of the major platforms for entertainment.

Not to mention the company’s investment in Facebook, which continues to give Microsoft Bing an edge over Google in combining search and social networking.

Windows Vista was a huge mess, and the distraction contributed to the rest of the company’s problems, but many would argue that “Microsoft 7″ — a.k.a. Windows 7 — has actually been a success for the company, at least in terms of getting the flagship operating back on track.

In the past, Ballmer has tried to address this issue by demonstrating his enthusiasm for the company. “YOU TELL ME if I lack energy or conviction, or we’re not driving all the change we need to drive!” he bellowed last year at the Seattle Rotary Club in response to a question about calls for his dismissal.

Employee surveys by Glassdoor.com give Ballmer consistently low ratings among Microsoft’s rank-and-file.

But should Ballmer be fired? Ultimately, it’s up to the people who own the company to make this assessment. Lots of Microsoft shareholders have expressed similar opinions over the years, although not enough to actually force the board to give Ballmer the axe. The catch is that Ballmer owns almost 4 percent of the company, and Microsoft Chairman Bill Gates owns more than 6 percent.

Ballmer has said he plans to stick around until his youngest kid goes to college, which would keep him in the CEOs office until at least 2017 — unless Hartung’s piece incites a shareholder revolt.

  • MagBill

    Steve is not remotely “the worst CEO of a large publicly traded American company today”. But “mixed” is the very best you could say about his performance. Microsoft would benefit from new leadership and probably should have made that change some time ago.

  • Mico

    Well, it depends on what view you take. A company that banks 100 million/day is not a succesful company because the share price is not moving? It’s not successful because it has a market lock due to it’s core business, rather than being an unprofitable social this or that, with huga market valuation, but no way to actually make any profits? I guess it’s the ‘old’ economy vs. the new economy.

    Yep, Microsoft is a failure from a Facebookish view of company success, and Mr. Ballmer has missed the boat on a few things, but one can;t be all things to all people. How many brand-name ‘new technology’ companies have gone out of business during Mr. Ballmer’s tenure? Well, Microsoft is still around adn while a bloated bureaucracy has long made it impossible to call the company innovative, Micrsoft is still around, is still a market leader ans still seems to have enough tricks in it’s hat. Mr. Ballmer may not be the most liked of persons, but he is certainly not the worst stewart for his company.

  • Seneca

    He is the worst but fortunately there are good people at Microsoft who make up for it. And yes, the sooner he leaves the better for employees, shareholders, and customers. Conviction without competence is meaningless.

  • http://www.mainstreetchatham.com/ JimmyFal

    “business consultant Adam Hartung, a Forbes contributor ”
    Mistakes were made, sure. Now is it 7 or 8 separate billion dollar revenue streams that MS has? Vista the failure that it was still was the best selling OS in history at the time, and Win7 is so stable that it will be on desktops for another 10 years like XP was and is. We have seen how Apple does with no competition, now lets see how they do with a full slate of competition this fall. You were there from the start Steve, stay till Bill tells you to go or till your passion is gone. Don’t listen to pundits, what a waste of space they are.

    • Guest

      How Apple does with no competition? What market did they ever have no competition in? Contrary to itard and media drivel, Apple has rarely been first to market. Generally they have entered late. That was true with music, smartphones, and tablets. As a result, they’ve invariably faced huge competition from larger entrenched competitors, including MS in all three cases. Indeed, MS had a decade head start in smartphones and tablets. Nevertheless, Apple wiped them out with their very first product launch. Apple has even done well against the overwhelming dominance of Windows, growing Mac share every quarter since Vista launched. All of which is why Apple is now larger than MS on revenue, profit, cash, and market cap.

      When W8 finally arrives this fall, three years post iPad1, MS will likely experience the same fate as it did when WP arrived three years post iPhone 1: abject market failure.

      • http://www.mainstreetchatham.com/ JimmyFal

        Why not change your name from Guest? The IPAD has no competition. Android is garbage. That’s why it’s not selling in the tablet department. Win 8 will be Apples tablet competition, mostly because it will compliment the hundreds of millions of Windows PC’s out there. Sure Apple defined a better device than any previous attempt that MS had made, but technology did not exactly allow smooth pinch to zoom until Apple implemented it. Otherwise it would have been done sooner. My jaw was the first to drop when I saw smooth pinch to zoom on the iphone. Kudos to MS for not simply making a giant WinPho7. For not rushing an unfinished product to market. WinPho is not a copy of the Iphone and Win 8 won’t look anything like the Ipad. Except for smooth scrolling and pinch to zoom. Which was the ONLY thing that ever impressed me about either the pad or the phones. The tortoise always beats the hare in the end. I’m riding the Tortoise.

  • Guest

    “Years late to market, he has bet the company on Windows 8 – as well as the
    future of Dell, HP, Nokia and others. An insane bet for any CEO – and one that
    would have been avoided entirely had the Microsoft Board replaced Mr. Ballmer
    years ago with a CEO that understands the fast pace of technology shifts and
    would have kept Microsoft current with market trends.”

    Hard to argue with that, at least.

  • Guest

    Frank Shaw, you’ve got another clean up in aisle 5.

  • Guest

    “YOU TELL ME if I lack energy or conviction, or we’re not driving all the change we need to drive!”

    This is akin to a drunk driver saying “Disregard the vehicle I totaled. Look what a great job I’m doing taking defensive driving courses and putting caps back on the empties”.

  • Guest

    Of course not, Todd. He simply has the largest number of men who see him as a father figure, constantly offering both subservience and gentle criticism anonymously.

    There are far more ineffective CEOs of far larger and far more profitable companies. Steve is just the CEO that the most number of men love to love.

  • Bob

    Hartung’s analysis is a joke and his ultimate conclusion is false. Nevertheless, several of his comments about MS and the impact of Ballmer’s tenure are accurate. And he’s right that Steve should have been replaced a long time ago.

  • Guest

    I love our strategy. The board loves our strategy. What does Forbes know about business anyway?

    - Steve Ballmer

  • Bonnie The Nanny

    Steve Ballmer and his enablers have always confused bombast and screaming with energy, drive, diligence and focus. I’m incredulous that this basic truth isn’t crystal clear to even the most casual observer. 

    Then again, people with billions of dollars are inherently “intimidating” even minus the overbearing, obnoxious, bullying, executive stereotype so exemplified by Ballmer. 

    Funny, most people with this type of vast wealth tend to be relatively taciturn and measured with their words and speech; their money does their “talking”—or “swearing” as Bob Dylan once said—for them.

    Not Steve Ballmer, however. Which only underscores some degree of insecurity on his part. Most people would be more confident with so much “Screw You” money. 

    From his nasty and offensive personality to his shameful and juvenile campaigning for a more just and equitable state tax structure, to his obvious inability to lead his organization to achieve optimum results, it’s clear that it’s time for this guy to go. 

    And, outside of a few personal connections, I can’t imagine who would miss him.

    • Bro

      dude I understand what you’ve said but check this – some of the most effective ceos in history have been people who you would not miss. They make the company talk, not talk for the company like steve.

  • http://www.christopherbudd.com Christopher Budd

    I have to say this: whatever else, it’s a rather poorly edited article: it really needs an edit pass. Simple, stupid errors like “Microsoft 7″ don’t help the credibility of the piece at all.

    While it’s easy to focus on Ballmer, it’s interesting to read the whole article and see what they say about others, especially Chambers over at Cisco. Microsoft and Cisco are the only two tech firms out of the five (GE, WalMart and Sears fill out the list).

    The writer doesn’t call this out, but my take is the overarching criteria is, in the words of the first George Bush, “the vision thing”.

    In talking about Immelt at GE, the writer notes:
    “Stewardship” is insufficient leadership in 2012.  Today markets shift rapidly, incur intensive global competition and require constant innovation.  Mr. Immelt has no vision to propel GE’s growth, and should have been gone by 2010, rather than allowed to muddle along with middling performance. [end]That’s what he’s taking all these CEOs to task for I believe. 

    Windows and Office continue to be great moneymakers and so it’s easy to cite that and say Ballmer isn’t the “worst CEO” out there. But I think the author’s point is that their success, in a way, is part of the problem. Guiding Windows and Office forward for ten years along the same established path would seem to meet the author’s definition of “stewardship”.

    What the author is failing to make explicit, I think, is that he’s put Ballmer at the top of the list because Ballmer failed to have a Gates-esque “Internet memo” a few years ago around devices that redirects resources and shakes things up to move in new directions.

  • Orin

    Horrors! How dare Hartung not think something based in Seattle is AWESOME!!1!

    While Microsoft is often compared to IBM, the company is in fact well on it’s way to becoming Kodak. Yes, they’re making money now, but MSFT is still a PC company, when it’s obvious to everyone outside of Redmond PCs are on their way out.

    Ballmer should, you know, buy himself a basketball team (or even better, a BASEBALL team) and step aside…

  • Guest

    There’s no denying that if Ballmer were judged on the same basis as MS’s regular employees he would have been Kim’d at least half a decade ago and managed out. Instead he’s been protected by the board to the detriment of the company, employees, partners, and shareholders.

  • Mike_Acker

    it is not the case that the computer market is ‘shifting’ to mobil, but rather that it is expanding into mobil . desktops and servers remain the core tools for serious work while mobil phones and tablets  are mainly for trivial ad hoc reference use

    • Joe Nobody

       haha, they DO, but no one seems to give a fuck about it.

      Windows brand is poison, drop it like a bad habbit.

      I guaruntee “Windows phone” would be selling more if it was “XBOX phone”, and themed in black and green. doubly more so if it had games like a handheld system.

  • Mike_Acker

    I love DISQUS and am finding little patience for  blogs which do not use it properly

  • Dracono

    I may have not said positive things about Microsoft of recent and only because I carry them with higher expectation, but Ballmer is defiantly not the worst, what about RIM? I guess Forbes tends to favor CEO’s who run companies into the ground and go begging for government bailouts such the institutional banks.

  • http://www.topbabas.com/ Prasant

    Well when it comes to innovation and growth there not much of progress from Microsoft .10 year before they where PC company and now also they are a PC company . There product  market share is decreasing day by day wiz . Internet Explorer  , Windows Os etc . Most importantly they are desperately trying to be in mobile market but road is very much though for them due to there arch rivals Google and Apple . 

    http://www.topbabas.com

  • John

    Did anyone even look to “consider the source” or are they just piling on?  Adam Hartung is a career motivational speaker and occassional blogger.  He makes a living stating history like he could have predicted it.  He also has a series of hits on Microsoft.   He’s a typical Mac Fanboy, and you’d expect this from any of them.   No real story here and definitely no expertise or experience.  

    For example, genius Adam also blogged that Google’s buy of Motoroal Mobile was a mistake, but that appears to be pretty smart now.   If Tim Cook had bought it, I’m sure Adam would have praised it.
     
    If someone like Jack Welch has wrote the blog, it might be worth repeating.  

    So if you want a motivation speaker to entertain your leadership team (but has never actually done anything) look for Adam Hartung.   If you want someone credible to rank CEO’s, keep moving… nothing to see here.

    • Guest

      So, basically, because you can’t refute his MS-related points you want to attack the messenger instead?

      And for the record, I don’t think it’s all clear yet that Google’s buy of MMI was “pretty smart”.

      • John

        No Adam, anyone could easily refute your statements, the point is that you’re unqualified opinions are worthless.   You might as well judge gymanstics at the olympics, you haven’t done that or have any expertise on that subject either. 

        Are your “points” stupid as well as worthless?  Of course, but many posts including “preferred user” below already point out the lists of fallacies in your “logic”. 

        Just enjoy the 15 minutes of fame that you won, not by your own achievements, but by attacking someone you don’t know in a position you can’t imagine.

  • http://profile.yahoo.com/QALEMHM6P6UW7LEEUIHZBVM6CA preferred user

     What about JP Morgan, AIG,Goldman Satan and the others remember the meltdown it was/is a lot worse than the Micro$oft thing ……… oh they can’t fire Jamie Over at JP  he is Obama’s buddy they  need him to run interference between the banksters (themselves ) and regulators oh… sH%$# what was I thinking what regulators where were they before and during the meltdown JP and Goldman Satan own the FED and the SEC SH&^T they ARE the FED and the SEC by proxy if you think about it.  

  • http://profile.yahoo.com/QALEMHM6P6UW7LEEUIHZBVM6CA preferred user

     What about JP Morgan, AIG,Goldman Satan and the others? remember the meltdown it was/is a lot worse than the Micro$oft thing ……… oh they can’t fire Jamie Over at JP  he is Obama’s buddy they  need him to run interference between the banksters (themselves ) and regulators oh… sH%$# what was I thinking what regulators where were they before and during the meltdown JP and Goldman Satan own the FED and the SEC SH&^T they ARE the FED and the SEC by proxy if you think about it.  

  • Srikant Aggarwal

    I think the Forbes authors have some very unreasonable articles of accusation. I read another which declared Citibank’s CEO a failure without proper grounds. I personally feel Ballmer is good as a CEO, my belief enhanced by the revolutionising design presented by MS for Windows 8, and we are going to see him bringing MS to bigger heights in both mobile and desktops in near fututre. Personally I am also very much impressed with Kinect design and its first of a kind consumer appeal.

  • Pjguitarist

    Still can’t forgive him for killing Courier

  • KevinHee

    Of course he is not. Otherwise, Microsoft, facing so many great competitors in tech world, would be dead by now after having the worst CEO for over a decade.

    But some unknown journalist blabbering garbage article that sells copies? Why not?

  • Joe Nobody

    your forgetting his time as VP from the 1990s. Microsoft keeps going from crisis to crisis.
    the “windows” brand named is beyond toxic after two decades of releasing buggy and unstable products, people run from it like the plauge. the much hyped “windows phone” probably will never get much traction as most people simply don’t want more “windows”.

    This is the man behind the anti-linux FUD in the 1990s.

    Before the Vista debacle, there was the original Windows XP, which ran like absolute dogshit until servicepack 2. Before that there was ME that had to be disconitued, and 98 second edition was made as a hold over. Before that, there was the launch date version of windows 98, and before that Windows 95, all which where bug ridden, unreliable, and slow.

    All as Balmer was VP. Microsoft’s abilities were able to sink opponents through manuevering, disinformation, threats, and intimidation, but never through direct competition. Mostly dirrected by balmer himself. Then they had the original contract with IBM from the 1980s mandating PC makers pay Microsoft for DOS regardless if they used it or not.

    So in short, microsoft NEVER had a viable product.(except mabey the X-BOX), and one of the reasons is Steve Balmer.

    He needs to go.

  • sportmac

    xbox? how is losing over 10 billion dollars ever considered good business? xbox lost that amount before seeing a profitable quarter. is simply having enough money to lose and hanging around forever good business?

    cripey, they could have built their very own international space station with that money.

    deep pockets and a willingness to lose fortunes is good business? yeah, it worked out for them on the xbox but it just as well could have failed. it hasn’t worked out for msn, search (whatever they’re calling it these days), hotmail, their web presence, have never made a nickel in profit, ever, in 10 years. that’s another roughly 8 billion down the drain. this is moneyball, nothing else. pay for your trophy and take it home.

  • JJ

    Huh…. Sometimes wishes *do* come true…