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Three Tips For Microsoft's Next CEO

Microsoft's next chief will face a host of challenges, including doing more to encourage innovation.
Kin Cheung
Microsoft's next chief will face a host of challenges, including doing more to encourage innovation.

Speculation is already beginning about who will replace Steve Ballmer as CEO of Microsoft. The names being floated are as diverse as Stephen Elop, the head of Nokia, and Steven Sinofsky, who ran Windows. Internally, a front-runner might be Tony Bates, who heads strategy at Microsoft and was the CEO of Skype before it was bought in 2011.

Whoever lands the job will be facing a challenge.

The digs on Microsoft are endless:

"People roll their eyes when you say Microsoft's name."

"It's the last century's tech company."

"Your grandmother's tech firm."

It missed the boat on search. It missed mobile. Its core business model of selling software is being attacked by companies that offer much cheaper services that run in the cloud.

And while Microsoft has tried to adapt — spending billions playing catch-up — few people choose to use Bing over Google. Microsoft's been forced to deeply cut the price of its Surface tablets because they failed to sell, and the Windows phone is still a distant third place.

But compare Microsoft's place today to where Apple was in 1997, when Steve Jobs came back, and it's clear the company has everything in hand to become a formidable competitor again. In the late '90s Apple almost went bankrupt. Microsoft, on the other hand, has nearly $70 billion in cash and racked up profits of nearly $5 billion in the most recent quarter. The number of people with PCs is approaching 2 billion and despite all its problems Microsoft still dominates that space.

So what would it take to turn the company around?

I'm sure lots of analysts will write about the company's need to put people first, focus on the user experience — get it right and execute. And that's all true, but that's obvious and it's what Microsoft has been trying to do already.

I have three quick thoughts and I'd like to hear yours. Send me ideas @hennseggs — or post them in the comments section below. Feel free to call me an idiot — I can take it.

Change The Culture: Take A Moon Shot, Maybe Two

Microsoft has 100,000 employees and many of them are brilliant, but the company's culture is cautious. It became the biggest tech firm in the world by aping Apple. It still is following Apple in the innovation department, but perhaps that's the wrong model.

Maybe Microsoft would be better off taking a page from Google's playbook — taking big, crazy bets, all guided by a certain underlying logic.

Google's self-driving car, Google Glass, even Project Loon play off Google's core strength — using artificial intelligence to deliver contextually useful information (and ads) when and where you need it.

Microsoft's core strength is still the PC.

Maybe it's too late to reinvent the PC as the center of our digital universe. But as a consumer I'm more comfortable with that version of the future than one in which every intimate detail about my life lives in servers in the cloud and is pored over by algorithms and spies.

I don't know who will be Microsoft's next CEO, but I have a suggestion for the company's next slogan:

Microsoft: We are going to make computing personal again.

Love The Living Room

With the Xbox and the Kinect, Microsoft has a home entertainment system that is technological leaps and bounds ahead of the competition. The Kinect can respond to your voice, recognize who's watching, act as a killer set-top box that searches through all kinds of programming and delivers the shows you want if you just ask it nicely. Oh, and it's a kick-butt video game system, too.

There's no typing on a tiny remote control, no horrific user interface. But the Xbox has the potential to do so much more. What, you ask? I don't know and neither does Microsoft, but it doesn't have to know. It needs to create an environment that encourages developers to play in this sandbox.

Think about what the app store did for the iPhone.

Nothing like that rich developer environment has grown up around the Xbox. If Microsoft could harness the creativity of millions of developers and entrepreneurs, that product could go from being successful to becoming a blockbuster.

It has tried: There is a Kinect accelerator in Seattle. But this isn't a software problem or an engineering problem — it's a social engineering problem. Microsoft has to figure out how to convince developers around the world to play in its sandbox. It has to overcome decades of bad blood and a history of quashing innovative ideas on its platforms.

New leadership and a powerful message could go a long way to making that happen.

Reinvent The PC

Nowhere would the payoff be bigger than in PCs.

The modern PC is a ridiculously powerful tool. It can do 3-D modeling and real-time facial recognition. It's fast enough to do all sorts of serious computing. But if you're like me, you use it to write, maybe work with a spreadsheet, search the Web and check email.

In short, most people use their PCs to do exactly what they can do on a tablet or a phone.

Hundreds of millions of PCs sit largely idle on people's desks, the machines' potential largely wasted. It's no wonder PC sales are tanking and it's no surprise that Windows 8 and its touch interface has failed to revive them.

Decades of abusive bullying have transformed the PC software ecosystem into a virtual desert. There are more than 1 billion PCs out there but, aside from a handful of huge firms like Adobe, Intuit and Microsoft itself, very few developers are working to figure out innovative things that you can do with your PC.

Even adding an app to your PC is a nightmare. You download software from Oracle and you end up with crap-ware installed on your Web browser and a half-dozen programs you didn't want.

That needs to change. The PC needs a software marketplace that works for consumers and entrepreneurs.

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Steve Henn is NPR's technology correspondent based in Menlo Park, California, who is currently on assignment with Planet Money. An award winning journalist, he now covers the intersection of technology and modern life - exploring how digital innovations are changing the way we interact with people we love, the institutions we depend on and the world around us. In 2012 he came frighteningly close to crashing one of the first Tesla sedans ever made. He has taken a ride in a self-driving car, and flown a drone around Stanford's campus with a legal expert on privacy and robotics.