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Ozzie, Mundie pick up tech mantle at Microsoft

newsmakers Executives Ray Ozzie and Craig Mundie talk to CNET News.com about how they plan to fill Gates' shoes.

REDMOND, Wash.--Bill Gates leaves some pretty big shoes to fill.

Think of Ray Ozzie as the left shoe and Craig Mundie as the right one.

As Gates announced his plans Thursday to begin the process that will see him eventually cease full-time work at Microsoft, he also announced that he was dividing much of his technical leadership responsibility among the two software veterans, both of whom have been serving as chief technical officers.

Craig Mundie, a longtime Microsoft veteran, will now handle the company's research units and will serve as Microsoft's external voice on technology.

The more prominent role, as chief architect, is being given to Ray Ozzie, the software industry legend behind Lotus Notes. Ozzie, though, is a relative newcomer to Microsoft, having joined the company last year, following Microsoft's acquisition of Groove Networks. Already, though, Ozzie has emerged as a key figure at the software giant, having been handed the reins for the company's all-important Live services push.

On Thursday, Ozzie and Mundie spent a few minutes with CNET News.com outlining how they plan to take over for Gates.

Q: Ray, Obviously you've spent the bulk of your time recently architecting the services strategy. Does this expanded role change your thinking in any way?
Ozzie: The great thing about taking on the services strategy as a particular initiative to hang my hat on over the last six to eight months is that it has brought me in touch with many different parts of the organization. Every offering that we have in the company in some way, shape or form is going to be touched by services. It's been more or less a platform for getting to know people and getting to know projects and so on. So, because of this, I've got these relationships. In terms of expanding the responsibility, there are a number of architectural issues that groups have that are not related to services. There are, for example, platform issues that span beyond (services). There is storage strategy and presentation strategy and things like that that I will become much more involved in.

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Are you going to be primarily trying to finish work on the services initiative that's just getting started?
Ozzie: That's right, and there is no end to it. It's a shift in the company's direction from primarily being focused on client and client and server to now client, server and service.

Are you going to still be the primary person responsible for services strategy?
Ozzie: Absolutely.

How soon do you expect you'll be looking at things like the future of Windows, and all the things that probably are classified as services but are not services?
Ozzie: Well, for each product, it occurs actually at different times. So, for example, the Windows and Office are just about to ship, and so when they enter their next planning cycles is the most significant time for them. Mobility has a different case. They have different ship dates. Every six months, they have some new release that goes to operators or manufacturers. So with that product line, there are many more opportunities for getting engaged, and reasons for getting engaged, obviously. The same on the Windows Live and on the MSN side--those have a much greater ship frequency, and I'm already engaged on that side in a number of different specific engagements.

When did Bill and CEO Steve Ballmer approach you about this role? What do you see as the biggest draw and the biggest concern?
Ozzie: Well, my company was acquired about a year ago. Craig and I and a number of the senior staff around that time were brought in on the notion that succession was becoming more relevant in Steve's mind...a lot of what actually happened with having division presidents was beginning to swirl in his mind in that realm, and I think we, in the discussions, knew that we played some kind of a role. But it was more ambiguous.

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Around this last board retreat in March, it became a lot more concrete in terms of what roles we might play and the timeframe within which Bill would be making a decision. And the decision was made this past Tuesday.

Craig, as chief technical officer, have you been doing some of those chief architect-like duties?
Mundie: My transition is sort of straightforward in a sense. The only thing I was doing that he's doing--it turns out, the last eight years I've been pretty much Bill's partner in both the engagement with research and in doing a lot of the issues around intellectual property and policy. So, in a way, I feel like Bill will, over the next year, pass the baton completely, starting with management accountability for those functions. But we were pretty closely aligned for a long time now because of my involvement with those areas. So, for me, it's adding another responsibility, but the areas are ones that Bill and I have been closely aligned with in the past already.

Microsoft Research does incredible things, and yet Microsoft gets most of its revenue from the same places that it's gotten most of its revenue for a long time--Office and Windows. Do you see a need to change the research effort in any way to make it a driver for the business?
Mundie: We're fortunate by any accounting of research efficacy to have really a tremendous (technology) transfer, and if you look, a huge part of the tech transfer has actually been into the mainline products. So, many of the things related to even interfaces and searching and help and natural language and other things came out of research and are in Windows and Office-type environments. So, we have been a beneficiary. But, typically, the research work is helping us have differentiation and leadership positions in a number of new areas. Right now, I think Rick (Rashid) and Bill over the years have picked, I think, 55 different areas of research, and we did get broad applicability. And unlike some of the well-known ones in the past where they didn't really get the transfer into product, you know, we have.

One of the things that I truly enjoy is taking on things that are complex challenges, meaning they have many interrelated aspects that must work together, whether it's the technological integration or, frankly, the business challenges that are similar.
--Ozzie

I was just in Beijing a few months ago and participated in their anniversary celebration, and one of the things that they kept track of, just out of the Beijing lab was how many inventions they had actually transferred into product groups. And I remember, I think the number was 212 in their first seven or eight years of operation. So, from a standing start to there, that's an indication in one lab how they've been able to get this off the shelf in products. Because they don't create whole new products all the time, many people may not see the specifics, but you can't tell that they come from research and they come from product groups. But there has been a huge thing, and I'm quite comfortable with the portfolio of research activities now.

Ray, we started talking about your role, and how you're going to be taking on the broader role as the natural product cycles come up. Do you see a need for at some point in the not-too-distant future to have somebody maybe underneath you who is really just focused on search strategy and services and the kinds of services, for example, that Google is doing? Everyone divides the world, rightly or wrongly, between Microsoft versus Google. Doesn't there need to be somebody full-time sort of coming up with an answer to Google?
Ozzie: I don't know about coming up with an answer to Google. If you look at specific aspects of what our competitors do, I think when you say Google, you probably mean search or search and advertising more than most. Within one of our divisions, we have a very, very capable leadership group specifically focused on search, and specifically focused on advertising, and heavily networked into (Microsoft Research), which is where we have a search technology center which is working very, very closely on innovations in advertising and innovations in fraud detection, innovations in search, algorithmic search, and so on.

So that, in and of itself, I would regard as more of a divisional leadership issue. In terms of a macro-level search strategy, in terms of if there is a competitor who is using multiple facets, that is, indeed, in my domain, and that is what I'm charged with.

How big a challenge do you see that being? Those responsibilities are being split up among several people--yourself, Craig, others. But you're taking over as chief software architect. How daunting does that task feel?
Ozzie: Well, if you look at my past, and the kinds of technological challenges that I've dealt with, one of the things that I truly enjoy is taking on things that are complex challenges, meaning they have many interrelated aspects that must work together, whether it's the technological integration or, frankly, the business challenges that are similar. When we were competing with Microsoft in a Notes versus Exchange, or this or that, there are all these issues of where do technology and strategy issues kind of cross, what should you be doing for the long-term, what should you be doing for the short-term. It's large, but to me it's not daunting. This is something that I can do where I can take all of the experiences I've gained in my 30 years in the industry and apply many or most of those lessons.

You've talked about the top couple of business challenges for the company as a whole. Do you have a similar sense for what are the top couple of technical challenges you need to tackle?
Ozzie: I think because the number of product areas is large, and the number of potential integration points is large, I do have a good sense. I've kind of formulated this over the past year, a little bit before I got here, but definitely since I've had more visibility into the organization, in terms of what are the really important integration points between products, where the customer really benefits from those integration points, and how to prioritize the different integration things that are important versus less important. So I do have kind of a framework.

How will you and Craig work together? Where do your areas overlap?
Ozzie: The way that we kind of view this is, if you had a continuum starting a technology all the way from communications technology or semiconductor, and started shipping that to basic research, advanced development, product development, and maybe even solution development for customers, you're going from very deep technology all the way up to the end user. And where Craig and I overlap, Craig starts at the technology and his natural skill sets and interests really are on that side, and up through that development, and where I begin is in advanced development all the way through the customer, and that tends to be synergistic with my past, having worked on desktop applications, having worked on a platform for solutions, and I think we complement each other very well.

We both tend to have product incubations, concepts at least that we're trying to incubate that are both in the advanced development realm, and our groups have crossed paths in there in a positive way, but I think that would kind of map out how we work together.

Mundie: The last seven or eight years, I've done a lot of the outward engagement for the company, both in the technology domain and the policy domain. And in a way that also is what Bill has done, and I will take on virtually all of that. So, I will have more of an external component than Ray will. He will speak out when he wants to speak out in terms of the general communication with both the partner ecosystem, as well as the formal policy questions.

Does that leave you less time for blogging?
Ozzie: Oh, my goodness. Yes, time management is quite an interesting issue. As a matter of fact, I've spent some time in the past week with Bill as we were beginning to talk about this in a more concrete way, about how he spends his time. We went through and looked at what he does with his reviews and meetings, how many relative hours he spends on one area versus another. What he does in e-mail. And I've seen him interacting with groups, but I've never had visibility into the specific allocations, and all that other. And it's been a really interesting thing, because there's a mapping of how and why he does what he does now, and how best to use me and my talents, which are different--we come from a different place--to address the challenges that the company might have moving forward and the opportunities that the company might have. So, I will probably spend a little bit more time more deeply in certain areas that I really have a passion about in terms of succeeding, deeper with the product groups. Bill has spent a lot of time at a broad level with a number of product groups.

Can we talk about some of those areas?
Ozzie: I'll state the obvious. Everything having to do with this Live initiative really Bill wasn't spending a huge amount of time on that, and now that's a very significant activity that I am engaged in. And I have a natural gravitation towards what Microsoft refers to as the information worker area. Because I spent so much time of my career in collaboration, that tends to lead me towards things related to communications and devices and things like that. I think those are areas in which I can add a lot of value to those groups, and because of the customer experience I've had with that.

One of the things that characterizes the way Microsoft has done its planning and strategy has been Bill's "think week," and using that as an opportunity to get ideas from across the company. Obviously, some pretty important papers come out of that. I'm curious, is that a model you look to continue? Will it be you reading all of those papers?
Ozzie: Bill has not actually read all the papers in a think week in, I believe he said, four years. As the process has evolved, individual employees realized this is a great opportunity to get a broad amount of visibility, and as it's progressed, more people have been commenting on think week papers, not just Bill. We're going to continue the process. A lot of great ideas come of out of it, and it actually surfaces a lot of very good thinkers within the organization. But we're going to continue evolving it toward many of our technical leadership commenting on things. I'll participate. I will continue to participate, as will Bill, as will Craig, and others.

Mundie: That one is sort of mythological in proportion because people have read about it. But one of Bill's great strengths has been, I think, in many ways, solidification of ideas from the various brain trusts in the company for years and years, and his ability to bring that together. That has become a much more collaborative process in the last, I would say, eight years, because that's when I went to work with him, and even then he was recognizing that that, too, needed a scale mechanism, and the creation of the CTO office was a part of a way to get the distribution of the collection and interaction with a number of these things. And while everybody sees Bill in a few of these public processes, the company really has had a richer form of interaction among the senior people, and the ability to synthesize and provide direction around that. As Ray said, I think all those things are increasingly important, and frankly shared among a broad group of people.  

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