What is striking about Satya Nadella is the almost yogic energy, intensity and confidence he exudes as he strides into his office at the Microsoft headquarters in Seattle, US. Wearing a casual black T-shirt, dark blue jeans and sneakers with padded heels, Nadella, 50, looks superbly fit as he settles down for a chat with India Today. Like his wiry frame, his jawline carries no excess baggage or bulge. With his clean-shaven pate and air of equanimity, he could easily blend into a tribe of wandering Buddhist monks if he donned a saffron robe.
Despite his manic schedule and onerous responsibility of running one of the planet’s most valuable companies, Nadella appears to have achieved a rare equilibrium that is seemingly undisturbed by the mayhem of change or the volatility of success. Nadella is clear about what defines him and tell us that it is an ability to “mindfully live in the moment” because, as he says, “that is all you got”. He seems immersed in the almost spiritual quest of living in the Here and Now. He acknowledges it is tough to do so-that’s the closest a mortal will get to sattva or the state of pure consciousness enunciated by the Bhagavad Gita.
If you didn’t know him well, you would consider Nadella more brash than brave to have scripted his book, Hit Refresh (released on September 25) on how he is recoding Microsoft in the midst of, as he puts it, the fog of war. After all, Bill Gates, the guru of geeks, waited 20 years after he founded Microsoft to pen The Road Ahead in 1995-a tour de force on the future of technology. And Steve Ballmer, who succeeded Gates, told Nadella after he handed over charge to him in 2014, that he had no intention of writing his memoirs as it was “too boring to look back into the past”.
Anyone else in Nadella’s place would have been visibly nervous to step into the giant-sized shoes of such exemplary founders. For billions of people across the world, Microsoft products such as Windows, Word, Excel and PowerPoint have become as staple as naan, pizza and noodles. To get an understanding of just how big the Microsoft footprint really is, visit its headquarters at Redmond. The town was a sleepy suburb of Seattle till Gates and his software crusaders occupied it in 1986. The sprawling campus is now spread over 500 acres and is dotted with 125 nondescript buildings identified by their numbers. (Nadella’s office is on the fifth floor of Building 34). Microsoft now has 124,000 employees with a presence in almost all the 190 countries in the world. Its annual sales totalled $85 billion-five times that of TCS, India’s largest IT firm-with profits last year crossing $16 billion
Yet storm clouds had gathered over Microsoft when Nadella took over. Microsoft stocks, a once blue-chip investment, had begun treading water. The company, once the vanguard of the personal computer (PC) revolution, was falling behind on all IT frontiers and had ended up chasing the tail lights of its competitors. Sales of desktop PCs that ran on its software had stagnated, while Android and Apple operating systems, riding the smart phone explosion, had soared. Microsoft had allowed Apple and Samsung to capture the cell phone market, Google to dominate the search business and Amazon to take a commanding lead in cloud computing. A poll of its employees commissioned by Microsoft showed that a majority were dissatisfied with the company, doubted its ability to innovate and worried that it was headed in the wrong direction. The company operated more like a confederation of fiefdoms with warring heads rather than as a cohesive institution.
It was in this depressing situation that the Microsoft board of directors chose Nadella to succeed Ballmer as CEO. He was, by all accounts, an unlikely choice. In Hit Refresh (a book directed as much at Microsoft employees as at the public), Nadella chronicles his rise, the leadership he has provided and his vision for the future. It is an engaging saga, an almost mystical quest to rediscover his soul and that of Microsoft. Nadella does so by asking such existential questions as ‘Who am I?’ and ‘Why are we doing what we are doing?’. He searches deeply for the answers to how he, his own organisation and societies can transform themselves in their quest to find new energy, ideas, relevance and renewal.
Nadella does this by pursuing three distinct narratives in his book. He first traces his own transformation, moving from India to the US, then enunciates his strategy of hitting refresh at Microsoft to bring change, and finally looks at the opportunities and threats posed by the ongoing fourth industrial revolution in which machine intelligence will soon rival that of humans. Nadella writes with a rare honesty, lucidity and clarity. There are inspiring insights into his leadership philosophy and how he used it in his efforts to transform the culture of a flagging Microsoft and infuse it with a new sense of purpose, direction and identity. In all this, Nadella is constantly seeking a higher calling, a meaningful mission that can galvanise people and societies.
Both in his book and in his interview (see: ‘We need a global consensus on privacy, security’), Nadella outlines how key events, including his childhood days in India, forged his personality. Nadella’s father, an IAS officer with a Marxist leaning, taught him to be less provincial and more intellectual. His mother, a Sanskrit teacher, wanted him to be happy rather than be hostage to any dogma. His room had posters of both Karl Marx and Lakshmi, the goddess of prosperity. As a school student in Hyderabad, Nadella’s ambition was to be a professional cricket player and banker. But he abandoned his dream for an engineering degree in micro-electronics from the Manipal Institute of Technology in Karnataka after he failed to make it to IIT. He remained passionate about cricket, though (his favourite players are Virat Kohli and Steve Smith), and his thoughts on leadership are influenced by the game. Sample this: “Cricket taught me to compete vigorously and with passion in the face of uncertainty and intimidation. Also the importance of putting your team first, ahead of your personal statistics and recognition.”
When he migrated to the US, Nadella could have developed a complex as many of his colleagues were graduates from IIT or IIM or both. Unfazed, Nadella went about equipping himself. He did his master’s in electrical engineering from a small college in Wisconsin and earned his MBA degree by enrolling as a part-time student. He joined Microsoft in 1992 after a brief stint with Sun Microsystems, looking to be part of a company that had the lofty ambition of changing the world. He got married the same year to Anu, a family friend, who was studying architecture in Manipal.
The arrival of their son Zain in 1996 proved to be a watershed. Soon after his birth, he was diagnosed with severe cerebral palsy. Nadella says taking care of their son’s affliction helped him develop “a deeper understanding of people of all abilities and what love and human ingenuity could accomplish-empathy grounds and centres me”. It taught him to be a more empathetic and compassionate leader. From then on began a remarkable journey of perseverance, courage and fortitude that propelled Nadella to the pinnacle of Microsoft.
When he was chosen to succeed Ballmer, Nadella had not run any of Microsoft moolah-making divisions like Windows or Office. (Both together still rake in over 70 per cent of Microsoft’s revenue and profits.) But what may have tilted the decision in his favour was that he exhibited a firm grasp of both the technology and business imperatives for Microsoft. He also demonstrated this in 2011 when he was asked to head Microsoft’s Cloud and Enterprise business, which oversees Windows Azure and operates at the cutting edge of technology. In contrast to the big, boisterous and bullying demeanour of Ballmer, Nadella is considered a calm, thoughtful, considerate and quintessential team player. Gates, who endorsed the decision to anoint Nadella, saw him as “humble, forward-looking and pragmatic” and someone who always “raised smart questions about strategy”.
While handing over charge, Ballmer’s words of advice to Nadella were, “Be Bold, Be Right.” The message was to throw dogma out of the window (no pun intended) and hit refresh. Nadella took the challenge to another level by launching an intense soul-searching exercise among his staff on Microsoft’s raison d’etre and its strategy for the future. He was also determined to change the culture at Microsoft from a know-it-all approach to what he calls a learn-it-all company. For that, he advocated a philosophy propounded by American psychologist Carol S Dweck, who believed that it was all about mindsets and that “the view you adopt for yourself profoundly affects the way you lead your life”. Dweck pushed to develop a “growth mindset” where every person felt empowered to accomplish the goals they set themselves. It had helped Nadella cope with the challenges in his personal life. He even had copies of Dweck’s book, Mindset: The New Psychology of Success, circulated to his top leadership.
Nadella also delved deep into the past to find out what made the company tick. Microsoft was founded by the magic of its software and strove to democratise and personalise technology. “A computer on every desk and every home” was Gates’s original mission. Now Nadella was being asked to go beyond Windows and open new doors. He was also keen to shed the image that Microsoft’s modus operandi was to ruthlessly crush the competition (it had run afoul of the US justice department under the anti-trust laws). After weeks of debate, Microsoft’s leadership team under Nadella came out with a mission statement that went beyond just making better technology for profit. It was “to empower every person and every organisation on the planet to achieve more”. It was a loftier mission with altruistic underpinnings that left every employee and customer feeling good. As Nadella said, “My approach is to lead with a sense of purpose and pride in what we do, not envy and combativeness.”
With evangelist fervour, Nadella got the flywheel of change spinning rapidly. All over the walls of Microsoft’s offices in Redmond, posters push the “we empower” message. One of them spouts an equation that says: Passion + Purpose + Platform = Power to change the world. And another in post office red states: “Make a difference-make things, make different things, make important things.” Transformation, however, was not restricted to slogans. Across the board, Nadella took some bold, tough and painful decisions. Soon after he took over, he shut down Microsoft’s $7 billion Nokia acquisition, which was going nowhere, sacking 18,000 employees. The same year he picked up the hit video game ‘Minecraft’ for $2 billion. Then in one of the single biggest deals of its kind in late 2016, Microsoft purchased LinkedIn, the online social networking site, for $26.2 billion. These two acquisitions gave Microsoft a firm foothold in the social networking and video gaming businesses. Unlike his predecessor, Nadella has also started doing business with his rivals such as Apple, whom he calls his ‘frenemies’. He is also betting big on three critical areas of the future for Microsoft: Mixed Reality, Artificial Intelligence and Quantum Computing, and hopes to make his company the dominant bull in the arena.
Already, Nadella’s efforts are paying rich dividends. He has not only brought back Microsoft to the forefront of hi-tech innovation, but also generated more than $250 billion in market value since he took over. Gates, in his foreword to the book, has high praise for Nadella, saying, “He didn’t completely break away from the past-when you hit refresh on your browser some of what’s on page stays the same. But under Satya’s leadership, Microsoft has been able to transition away from a purely Windows-centric approach. He led the adoption of a bold new mission for the company?. And most crucially he is making big bets on a few technologies like Artificial Intelligence and cloud computing, where Microsoft will differentiate itself.”
Nadella is also deeply immersed in tackling the larger issues that the digital age has thrown up. Issues such as privacy and security that have brought large companies like Microsoft under the scanner and pressure from the government. As he puts it, “Computers can spread freedom of expression at lightning speed, but chillingly, governments can use the technology to eavesdrop.” He advocates stronger privacy protection, modernisation of laws to deal with use of technology and more carefully controlled access to data for law enforcement for security reasons. With the advent of quantum computing, there are issues concerning the future of humans and machines-whether they will end up working together or against each other. Also the tremendous potential they hold for helping the old and disabled. There are also deeper questions about how technology can become the great equaliser between rich and poor nations and enable economic growth for everyone rather than make the next industrial revolution a jobless one. He deals with these issues at length in his book.
Nadella has an Eastern answer for what he has done so far: we are making greater progress but we should never be done. His message: you need to keep hitting the refresh button.