The annual Microsoft Global Exchange conference is an event where Microsoft executives can get instant feedback on how they're viewed by their employees. But the feedback isn't always positive, as Microsoft COO Kevin Turner has learned firsthand during his eight years at the company.
Early in Turner's Microsoft career, he took the stage for an MGX keynote dressed up as Indiana Jones, with a leather jacket and hat. Sources who witnessed the spectacle told CRN that a visibly uncomfortable Turner ripped off the costume 30 seconds in, and proceeded to give a speech that was stiff and uninspiring.
Last year at MGX, Turner tried a different approach by coming out in full Steve Ballmer mode, pacing back and forth on stage, shouting and gesticulating, all in an attempt to fire up employees. But Turner's high-energy antics were met with stony silence from the crowd of some 15,000 employees, sources told CRN.
Despite his MGX travails, Turner is well loved by Ballmer -- who often refers to him as "my guy" -- and for years has been seen as his likely successor as Microsoft CEO. But that no longer seems to be the case. Turner lost power in Microsoft's recent corporate reorganization: He previously had sole oversight of Microsoft's marketing and OEM division prior to the reshuffle but now shares those duties with other executives.
Despite Turner's relative success in a number of areas at Microsoft, his inability to win over large audiences, both inside and outside Microsoft, is one of the reasons he is now a long shot to replace the departing Ballmer, according to interviews with more than a dozen former Microsoft executives and high-level sources close to the software giant.
Nearly all of the people CRN spoke with for this story didn't want to be named. But the consensus that emerged from these talks is that as Microsoft searches for a new leader to carry out its devices and services strategy, Turner is unlikely to get the job.
"The sense I get is that Microsoft wants a fresh point of view and would prefer to look outside," one high-level source close to Microsoft told CRN after Ballmer's departure was announced. "I heard that there were 'two or three internal possibilities', but that Kevin Turner was not on the list."
Microsoft's top leadership "wants 'a software guy or gal' who can gain the respect of the engineering teams," the source told CRN. "They really do not want to accelerate the loss of talent there."
Reports surfaced earlier this month that Microsoft has a shortlist of potential Ballmer replacements that includes external candidates like Ford CEO Alan Mulally and Nokia (NYSE:NOK) CEO Stephen Elop, as well as three internal candidates.
Microsoft declined to make Turner available for an interview with CRN despite repeated requests that began after the company's Worldwide Partner Conference in mid-July.
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THE WALMART INFLUENCE
Turner is known as an intensely appraising executive who possesses more comprehensive knowledge about Microsoft's business units than anyone except Ballmer. He gets a lot of the credit for Microsoft making the transition to a global corporation with a portfolio of massive, complex businesses.
Microsoft insiders say Turner's obsessive focus on metrics has led to big gains in both top- and bottom-line performance under his tenure. Microsoft's net income has soared 78 percent from $12.25 billion when Turner joined the company in 2005 to $21.86 billion now. During the same period, Microsoft's sales nearly doubled from $39.8 billion to $77.8 billion. At the same time Turner was driving the improved financial performance, Microsoft's headcount soared 63 percent to 99,130 employees, up from 61,000 employees when Turner joined.
Turner is all about numbers, and discipline, and metrics, and constant evaluation. At Walmart, this approach yielded results, and this helped him rapidly climb the corporate ladder. After starting out as a cashier, Turner became Walmart's youngest-ever corporate officer at age 29, and worked his way up to CIO a few years later. After that, he was CEO of Sam's Club, a $37 billion Walmart subsidiary.
During his time as CIO, Turner became acquainted with the idea of "using IT as a competitive weapon," and he has applied this to Microsoft's operations, one source who knew him at the time told CRN.
Microsoft had a spotty track record with internal infrastructure projects when Turner arrived. Despite having multiple ledger systems, the company had a tough time keeping track of assets. Before Microsoft got into the CRM market, it had a botched Siebel CRM project that ended up costing about $30 million to fix over several years, the source said.
After joining, Turner upgraded Microsoft's internal systems and standardized its procurement, and the benefits were immediately felt, the source said.
"Microsoft had never had a very run-the-business-oriented COO before Turner arrived. Microsoft was a fat, lazy bureaucracy because it grew too fast, and he helped clean that up," the source said. "They needed someone to come in with operational discipline and give them a business operating platform for a corporation their size, and Kevin did that."
However, former Microsoft employees, and some of Microsoft's top partners, told CRN that Turner's obsessive focus on metrics and cost cutting isn't helping the company keep pace with its rivals in the marketplace.
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