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Microsoft's Musical Chairs

Last week, Microsoft announced that Jeff Raikes, president of the Microsoft Business Division, will retire in September. The gentle, nine-month transition will allow plenty of time for Raikes' replacement, former Juniper Networks COO Stephen Elop, to step in. Elop will be taking over the Information Worker, Microsoft Business Solutions and Unified Communications branches at Microsoft. It's worth noting that before arriving at Juniper, Elop was the former CEO of Macromedia and president of worldwide field operations at Adobe.

The rest of Raikes' job will be handled by longtime Microsoft executive Bob Muglia. Microsoft is elevating the Server and Tools Business headed by Muglia out of the Microsoft Business Division. The result is that Muglia will be reporting directly to Microsoft CEO Steve Ballmer.

As Mary Jo Foley notes in her blog, Raikes' delay-action departure is only the most noticeable in a spate of leavings. Since around the start of the new year, Microsoft has lost or moved Mergers & Acquisition Chief Bruce Jaffe, General Manager of Platform Strategy Charles Fitzgerald, Developer and Platform Evangelism Chief Sanjay Parthasarathy, and General Manager of Community Support Services and MVP Program Sean O'Driscoll.

Oh, and there's the little matter of Microsoft founder and chairman Bill Gates retiring in June.

Greg DeMichillie, an analyst at Directions on Microsoft and a guy who spends entirely too much time thinking about all things Redmond, had this to say to me about the Raikes depature:

"Our best read on this is that Raikes was a long-serving and loyal soldier who had been successful at just about every job at Microsoft and who was looking at what's next. The next logical step for him is to be a CEO, and that is simply not a job opening that Microsoft is going to have any time soon. So he probably decided to leave a year or so ago with the understanding that it wouldn't be announced until a replacement was found.

"The surprising thing is that Microsoft had to look outside for his replacement. It doesn't speak well to Microsoft's ability to grow and develop its management ranks if, out of a nearly 80,000-person company, there was no one ready to step up to this role."

What do you think? Does the Raikes retirement and the hiring of Elop portend a company in trouble? Or are we simply looking at another one of those Redmond retirement runs that seem to occur every so often? E-mail me at mdesmond@reddevnews.com.

Posted by Michael Desmond on 01/15/2008 at 1:15 PM


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