Microsoft CEO Satya Nadella Has ‘High Customer Empathy,’ Says Former Boss

February 28, 2014, 3:57 PM ET

Microsoft CEO Satya Nadella Has ‘High Customer Empathy,’ Says Former Boss

By Clint Boulton

Reporter

When Microsoft Corp.’sMSFT +1.19% board picked Satya Nadella as the company’s next CEO, many people talked about his 20-plus years at Microsoft, his engineering skills, and his success building the Azure cloud business. But CIOs might like to know that the company’s new chief, who succeeded Steve Ballmer on Feb. 4, has a good ear for customer needs, says a former boss.

Mr. Nadella’s experience managing Microsoft’s online services group and other divisions where Microsoft was playing catch-up has made him more attuned to customers than if he’d been running businesses that dominate the market. “His customer empathy is very high, because he’s worked for some [Microsoft] groups that faced strong competition and that forces you into a spot where you’ve got to really listen to the customer,” said Doug Burgum, who managed Mr. Nadella for nearly seven years.

After selling Great Plains Software Inc. to Microsoft in 2001, Mr. Burgum became chief of Microsoft’s business software unit. He quickly identified Mr. Nadella as a talented leader and promoted him to corporate vice president. The two worked closely together to compete with Oracle Corp. and SAP AGSAP.XE +0.76% in the market for financial and customer management software — areas the two companies continue to dominate today. Mr. Burgum, a co-founder of Arthur Ventures, is now a venture capitalist.

In 2007, Mr. Ballmer put Mr. Nadella in charge of Microsoft’s online services division, where the company’s Bing search engine lagged behind search engines from Google Inc. and Yahoo Inc. Facing strong competition helped him appreciate working hard to meet customers’ needs, Mr. Burgum said.

Mr. Nadella is also humble and willing to share the limelight with others, Mr. Burgum said. In his first email to employees, Mr. Nadella credited Qi Lu, who manages Microsoft’s applications and services group, for noting that Microsoft empowers people to do more. “He understands a CEO has a free and unlimited resource called acknowledgement,” Mr. Burgum said. “So many CEOs don’t understand that.”

He’s also curious and willing to ask questions, coming into meetings “assuming he’s going to learn something from the group,” Mr. Burgum said. And his honesty and sincerity make him a “great attractor of talent.”

Mr. Burgum’s Valentine to Mr. Nadella is all well and good. But Mr. Nadella has some experience gaps, including in mobile computing, noted Merv Adrian, a Gartner Inc. analyst who covers Microsoft. With Microsoft rallying around cloud and mobile technologies, Mr. Nadella must work closely with founder Bill Gatesand Stephen Elop, who rejoined Microsoft when it acquired Nokia’s handset business. “They have to get mobile right,” Mr. Adrian said.

Mr. Adrian also said that Mr. Nadella’s insider status — he joined Microsoft in 1992 — could make him “overly respectful” of existing businesses, which could preclude him from making tough decisions that could be critical to the company.

He said Mr. Nadella’s biggest challenge is redefining Microsoft’s corporate culture, which has been “navel-gazing for a long time” and lacks a cohesive commercial vision. “They’re going to need some kind of singular marquee idea that says, ‘This is what we’re about’,” Mr. Adrian said.