Worries That Microsoft Is Growing Too Tricky to Manage

SEATTLE — At a time when many people in business believe the number of products at Microsoft should be getting smaller, it is about to become a lot bigger.

Marc Whitten, a top executive for Xbox, one of Microsoft’s many disparate product lines.

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Microsoft’s $7.2 billion acquisition of Nokia’s handset and services operations, when the deal closes early next year, will increase the company’s head count by 30 percent and add a big, new hardware unit to a dizzying variety of businesses — an unusual situation in an industry where focus is often prized more than breadth.

It’s a concern to everyone from academics to Microsoft alumni. A list of missed opportunities and disappointing investments at the company in the past decade in areas like smartphones, tablets and Internet search have led to the belief that a more focused, nimble collection of mini-Microsofts could respond more effectively to the never-ending flow of disruptive technologies nibbling at its foundations.

“It is very hard to be a broad-based tech conglomerate,” said David Yoffie, a professor at the Harvard Business School.

Thirteen years ago, Microsoft’s competitors and a federal judge demanded that Microsoft be split up because of its market power. But trying to do too much rather than wielding too much power is the issue now.

Microsoft already has a video game console, the No. 2 Internet search engine, a major Web portal, an enormous corporate software business, an operating system for personal computers, cloud computing services and applications software. The company is a mash-up of the businesses in which competitors like Google, Yahoo, Oracle, Apple and Nintendo specialize, putting an enormous burden on the company’s chief executive, Steven A. Ballmer, who has announced plans to retire within the next 12 months.

Microsoft’s complexity will make its search for a replacement for Mr. Ballmer more challenging, since the job will require a person with an uncommon array of skills, including fluency in corporate and consumer markets, hardware, software and Internet services. Mr. Ballmer recently announced a sweeping reorganization of the company intended to improve its agility, though its huge portfolio of products will remain intact.

 “It makes it harder to manage, which is a challenge for Microsoft no matter who the successor is,” said Mr. Yoffie. Long before Mr. Ballmer announced his retirement, he and Bill Gates, the Microsoft chairman and co-founder, had both quietly acknowledged that identifying a new leader for Microsoft would be hard. A person who spoke to Mr. Gates several years ago on the subject of succession recalls the Microsoft chairman saying he would support replacing Mr. Ballmer if he could think of someone who could do a better job.

Similarly, another person said Mr. Ballmer himself said a few years ago he would step aside if a better chief executive could be found. These people spoke on the condition that they not be named because the conversations were private.

Larry Cohen, a spokesman for Mr. Gates, did not respond to a request for comment. Frank Shaw, a spokesman for Microsoft, also declined to comment.

In 2000, when Microsoft’s business was simpler than it is now, Thomas Penfield Jackson, a federal judge, ruled that because of violations of antitrust law, Microsoft should be split into two companies — one focused on Windows and the other on applications. An appeals court later threw out the breakup order after deciding Judge Jackson had tainted the legal proceedings by making comments to the press about the case.

Pundits, business professors and alumni of Microsoft have spent years pondering whether, in hindsight, such a breakup might have given the resulting “Baby Bills” the agility to compete better. Several of Microsoft’s businesses would be substantial stand-alone companies, with Windows accounting for $19.2 billion in revenue for the fiscal year ending in June, and its business division, dominated by its Office applications, at $24.7 billion. A third business, servers and tools, had revenue of $20.3 billion in the period — compared with the $27.5 billion in software revenue at Oracle in its latest financial year ending in May.

Corner Office: Jed Yueh of Delphix on Learning to Manage Yourself

This interview with Jed Yueh, chief executive of Delphix, a software company that streamlines data management, was conducted and condensed by Adam Bryant.

Q. What were your career plans in college?

A. I was an English and psychology major at Harvard, so I had no plans to be an entrepreneur or in technology. My friends from college and high school who were interested in computers all scratch their heads and wonder, “Why are you the tech C.E.O.?”

Q. So what happened?

A. There’s so much money in Silicon Valley to create new technology companies, and I was one of the little particles on the fringe of the carpet that got sucked into the vacuum. I learned how to program in Excel, and built a couple of models for some friends. They got me some contract work for this one company, and I looked at their technology strategy and products and I learned about the industry. That gave me the idea for my first company.

Q. What were some early leadership lessons as you built that first company?

A. My biggest lesson was that you could be technically right and management wrong, and I learned that early on. I can articulate and debate a viewpoint from many angles, and I found that I could be technically right and force somebody into a viewpoint. But then they would slowly spiral into a place where they’re not really working hard because they feel demoralized. So I lost wars by winning battles.

So the first of my three management principles is that you’ve got to learn how to manage yourself. You have to understand how to win wars, not individual battles. If you don’t manage yourself very well, it’s hard for you to maximize the performance of a team. And managers can either increase or decrease motivation for their teams. They can either increase or decrease clarity for their teams. They can either build cultures that are highly collaborative and capable of solving problems quickly, or they can create cultures where you have a lot of paralysis and it’s very difficult to make decisions.

My other rules are hire right and fire right, and that’s pretty much all you have to do to be a great manager. It’s really not that complex at the end of the day.

Q. So let’s talk about hiring.

A. Hiring is the moment when your biggest lever exists for defining the culture. If you don’t know the traits you’re looking for and you haven’t hired around those traits, then you are effectively hiring a wishy-washy culture.

Q. What are the qualities you look for?

A. My two highest-level traits are clarity and creativity. Let’s talk about clarity first. When you’re building a business, there are so many things you can do, so many avenues you can chase, that you have to very quickly find the optimal path. If you can’t separate the signal from the noise, if you can’t find clarity, it’s going to very hard for you to manage a group. It’s also going to be easy for you to spend time in all the wrong places. So it’s very difficult to become efficient if you don’t have clarity.

Q. How do you determine whether somebody has that quality?

A. When I interview someone, I’ll often ask them: “Tell me about why you’d like to join Delphix. What do you think is valuable about Delphix?” I want them to pitch Delphix to me. They’ve had to take in a lot of information about us. They’ve probably read things from a number of sources, and read our Web site. They might have talked to a number of employees ahead of time, and they’ve been synthesizing the information.

So what I want them to do is to present to me how they think about and try to understand something that is new to them, which in this case is Delphix. Some people will immediately dial into the most important elements in the exact right order, and it’s not as simple as it looks. There are a thousand ways you can tell a story and only a few ways that really hone in on what’s important.

I also will ask them about successes and achievements in their career, and then dig deeper. “Why were you successful when you were doing this specific project?” And you’d be amazed at the range of how people answer that. Some meander around, and they cannot get to the point. They don’t really know why they were successful, in which case I know they actually never had clarity. Can they find the story? That really is how you identify clarity in an interview.

Q. You said the other quality was creativity.

A. They have to be able to solve a lot of problems, because the problems you’re going to encounter in a start-up are in every direction. So we have to have people who are creative. It has to be core to a technology company, too. In the technology industry, the chessboard continues to unfold and change.

So I’ll ask people to describe to me how my product works. You’ll find that a lot of people have no creative curiosity. But let’s say you’re one of these engineers who is creative and curious and you’ve figured out how the product works. It’s guaranteed that you don’t understand how every aspect of the product works. So I’ll push somebody until they enter an empty space, in terms of their knowledge, and I have an unfair advantage, because I know how it works. If they can’t answer it, I’ll say, “How would you fill that space?” Some of them will actually problem-solve on the spot, and nail the design, in which case we have a winner. You can do it in all industries and roles, too. You can ask a salesperson, “Tell me about a complex deal that you worked on, and how you got stuck and how you solved it.”

Q. And your third rule is “fire right.”

A. We’ve all made mistakes in hiring, and you know you’ve made a mistake when you keep investing more and more time in an individual, and you’re not getting a return. You have to invest in new talent. You have to coach them. You have to help them. But if you are not seeing a return, then you have to make changes.

Q. Anything you have a particularly low tolerance for?

A. My pet peeve is people who think in silos. You want people to think globally and execute locally. But a lot of people just want to think about their own little world and not connect it to the broader picture. We can’t afford that in a start-up.

This interview has been edited and condensed.

App Smart: To Manage Time, Track Time and Pass the Time

One thing that working at home absolutely requires is lists, to keep you from losing track of what you’re supposed to be doing. Wunderlist, a free iOS and Android app, is a powerful app for making and managing lists that has a clear interface controlled by gestures and taps. You can make as many lists as you like and add lots of items to each one, and you have the option of setting reminders for each item. List items can even have subelements and notes. The company also offers a cloud-based scheme so you can share your lists with colleagues or your boss.

The app is a pleasure to use. But one minor irritation is that some of Wunderlist’s features require a subscription. For example, to add unlimited subtasks or have the ability to designate tasks to friends or colleagues, you’ll have to pay $5 a month.

Another way to keep yourself on task and on time when working from home is by using a time management app. Eternity Time Log Lite is a great option, and it’s free on iOS. The app promises to help you time your work, rest and play — and these are the main categories loaded into its activities list. Tapping on each category brings up a timer window with a big start button. To log time on a particular task, you use this timer and add a note or a tag for later viewing. Later, you can look at the activities and filter them by tag or even by hour ranges, giving you an insight into your work patterns.

The app is easy to use, but it does require a lot of input and management. For best results, you have to use it consistently and all the time, and this may not suit you (though it is probably easy to get into the routine). As with Wunderlist, the app’s free edition is useful, but to access the full list of features, like the ability to create an unlimited number of activities and tags, you have to buy the pro edition at $10.

One alternative iOS time tracker is OfficeTime. It costs $8, but it’s powerful and it has handy in-app notes to guide you through its features. A similar Android app is Timesheet-Time Tracker. Though this app is free, it is powerful, and even lets you export your time and task data in an Excel-friendly format.

For freelance home workers, one important task at the end of completing a job is invoicing. The popular iOS and Android app Zoho Invoice has this task covered, and it’s free. Though the app’s really about invoicing, you can also use it to track time spent on different projects. It’s simple to use and attractively designed, which in its Android edition makes it stand out a little from many of its peers. But it does require you to sign up for a free account, and to make the most of it, you will probably find that you spend a lot of time typing in detailed data. It can also be easy to get lost among its different menus because they look similar.

Working from home can mean staring at your computer for long periods of time, and that may not be a great thing for your eyes. You can set your phone’s built-in timer or alarm apps to prompt you to spend a moment looking away from your monitor. Or you could use an app like Simple Repeat Timer on iOS, which is free and which will repeatedly alert you at a set interval. The Android app Yata! Yet Another Timer, which is also free, has a repeat timer function among its other clock applications.

It is hoped these apps will help you remain productive while you work at home. But you should also take breaks and have a little fun — something that simple games on your phone could help you with.

Quick Call

Soundwave is a new music discovery app that has a neat social twist. Instead of merely showing you which tracks are popular, it also shows you what nearby Soundwave users are listening to. In many cases you can also listen to a 30-second sample of the tracks. It’s free on iOS and Android. ... The popular image-sharing app Imgur is now available for Android devices. It’s a beta edition, so it may be a bit flaky, but it’s free.