One of the most shocking bits of news about Microsoft’s reorganization last week is that 20-year Microsoft veteran Kurt DelBene is out. He’s retiring.
DelBene was president of the Microsoft Office Division and his exit was described as a “surprise” by several former Microsoft employees we talked to. He was well-liked within Microsoft, they said.
Some people speculated that DelBene opted to retire because there was no role for him in the new reorganization.
However, Business Insider has learned from a source close to the company that DelBene had been wanting to retire prior to the reorg. This source, who requested anonymity, said that DelBene’s desire to leave may have helped spur Ballmer into the reorg.
Microsoft denies that. A spokesperson told us: “Kurt’s decision to leave was definitely personal. His retirement was not one of the reasons that sparked the reorg. It was done for things laid out in Steve’s memo. To advance our strategy and execute more efficiently, we needed to change how we were organised.”
CEO Steve Ballmer took a big chance with this reorg and wiped all the “mini-CEO roles” where chiefs like DelBene were responsible for all aspects of their units. Instead, Ballmer created new engineering units to create products, making other executives responsible for finance/marketing. He wants Microsoft to behave like one big integrated company, instead of a series of fiefdoms.
People were surprised that DelBene was out — instead of getting a bigger role —because he had a lot of success in the one area where Microsoft really needs help, converting its established software products into “services.”
“He diversified away from PC software and that’s what Microsoft has to do in the post-PC era,” Rob Helm, director of research for analyst firm Directions on Microsoft, told Business Insider.
His team created Office 365, the cloud version of Microsoft’s Office apps. The enterprise version is starting to gain momentum and DelBene’s unit has been experimenting with pricing/models for consumers, too.
For instance, its Office 365 Home Premium costs $99 per year and lets you install it on up to five devices. It’s the same software as Office 2013, it even installs on your PC. It’s just a different pricing model. In May, Microsoft declared it the ‘best-welling’ version of Office ever.
With DelBene out, Office 365 has become the responsibility of Qi Lu, who is running the new Applications and Services Engineering Group. Lu is also responsible for Skype, Bing, Yammer, Lync, Sharepoint, Exchange, and other apps.
One reason DelBene may have wanted to retire was that his wife Suzan DelBene, also a former Microsoft exec, was elected to the U.S. Congress in 2012. She’s living half the year in Washington, D.C. on the other coast from Seattle, and that’s a long, tiresome commute for the couple.
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