Microsoft Announces Change to Senior Leadership, Strategy

Microsoft will more formally transform itself to adapt to the needs of this new AI era by creating a new Office of Strategy and Transformation that will report directly to CEO Satya Nadella.

“As we’ve seen time and again throughout our 50-year history, times of great change for the world and for our industry require us to have a mindset that enables us to continually adapt and transform ourselves,” Mr. Nadella wrote in a letter to employees that the company shared publicly this morning. “There’s no question that we are at the forefront of another such moment, with the rapid changes across every industry and business function in this AI era.”

To address this need, Nadella has created a new Office of Strategy and Transformation that will be led by Kathleen Hogan, who was previously Microsoft’s chief people officer. Hogan will “define [Microsoft’s] overarching corporate strategy and structure and lead [its] continuous transformation as a company,” Nadella says. “Kathleen will work across the SLT as we chart this next phase of our transformation, which requires both interpreting the outside and redefining the inside.”

And that’s about all he says about what could very well be a momentous change at the software giant. Under Nadella, Microsoft has been a cloud-focused and now AI-focused company. And we know that in both cases, he has required Microsoft’s various businesses within the company to conform to these needs of those strategies. In some cases, he has aggressively jettisoned businesses that could not or would not conform.

But this could be even more aggressive. With this appointment, Microsoft will now formally define its focus as a company and, if I’m reading this correctly, restructure as needed to ensure that Microsoft can most efficient implement its strategy across its businesses.

Of much less interest, Microsoft has also promoted Amy Coleman to chief people officer to succeed Ms. Hogan. She was previously in charge of Microsoft HR.