Microsoft Gives Ballmer a Soft-Landing Sendoff

ballmer bw Microsoft Gives Ballmer a Soft Landing Sendoff

The PR Verdict: “B” (Good Show) for Microsoft and its long, slow farewell to Steve Ballmer.

Steve Ballmer’s slow exit as Microsoft CEO, announced last week, was either a surprise, or it wasn’t. Long-planned, or hastily arranged. Came at the “right time” or was long overdue. As always, it depends on the source. Tech’s original mega-gorilla, once disruptive but now doddering, did its best to give him a nice sendoff, while practically every other observer fell on the corpse to stick knives in for his decidedly mixed tenure.

Give Microsoft credit: Ballmer’s 13-year term at the helm, which will end sometime in the next 12 months, saw annualized profit grow 16 percent, but also a $600 billion market cap cut by more than half. The post-mortems dredged up other big misses – the Surface tablet PC, Windows Vista, and the Windows phone. Small wonder the company stock enjoyed a seven percent bounce on the day of the announcement.

Despite the rehash, Microsoft came away looking good. The company has been under fire for some time for having no clear transition plan. Now it does, announced in fairly orderly fashion. Transition management isn’t easy under the best of circumstances, and certainly Microsoft’s were far from that. The company needed to make a decisive but not too sudden move, and succeeded.

THE PR VERDICT: “B” (Good Show) for Microsoft, for sticking to a classic PR script that minimizes blowback and cements its key messages.

THE PR TAKEAWAY: Big news, even if double-edged, has its advantages. When breaking it, remember that you control the story and can pick your timing. The Ballmer announcement came on a Friday in late August, about the sleepiest time of the year, and in standalone form: It won’t be directly linked to Microsoft’s last sorry earnings announcement in July, which featured a $900 million product writedown. Nor will it distract much from its next product release, Windows 8.1, in October. The company made Ballmer available for one interview, and that will be the reference going forward. Finally, it left the exact timing of his departure vague, concealing behind an opaque corporate façade the likely fact that he is already gone.

Does Microsoft Need to Think Different?

Ballmer MSFT tablet Does Microsoft Need to Think Different?

The PR Verdict: “D” (PR Problematic) for Steve Ballmer’s Microsoft.

Pity poor Microsoft – no, really. Tech’s original 800 lb. gorilla may have shed a few pounds since its heyday, but it continues to punch well below its weight. And its PR strategy, such as it is, doesn’t seem to be helping much.

Consider this: While its Q4 2013 earnings, announced last week, showed enviable revenue and income gains year over year, they also included a $900 million writedown on unsold inventory of its Surface RT tablet computer, a hoped-for iPad killer. In response, it announced a management shake-up of its hardware division. Its stock tanked anyway, dropping 11 percent  and erasing $30 billion in value.

From a PR standpoint, Microsoft continues to fare the worst among seven tech giants caught up in an ongoing debacle over the US government’s Internet eavesdropping program known as PRISM. It ill-advisedly sought to use the breach to stoke competition, going after Google in a PR campaign promoting online privacy. That proved embarrassing after new disclosures surfaced that Microsoft helped the government circumvent its own encryption methods.

Institutional investors, dismayed by the company’s strategy and execution, want a seat on the board and a say in management. Of particular concern is succession planning for CEO Steve Ballmer, who has led the company since 2000. Microsoft says it has a plan but won’t disclose it.

THE PR VERDICT: “D” (PR Problematic) for Microsoft. Its half-measures, hubris and haughtiness suggest the need for a full-on PR intervention.

THE PR TAKEAWAY: Take a hard look within. A periodic full-scale review of PR strategy is essential, and best conducted by an outside consultant free from corporate groupthink, before a crisis. Microsoft is fumbling on basic issues management. It could have given investors succor with a mea culpa on its product writedown. It could allay the longer-term management concerns with greater transparency. It should have seen the folly in trying to capitalize on the privacy issue while damaging disclosures were potentially in the wind. Long-time archrival Apple has maintained goodwill in the past with public acknowledgments and apologies for its missteps. To quote its rival, Microsoft needs to “Think different.”