Satya Nadella is running scared. That’s a good thing.

If there were anyone who could rest on his laurels, it would be Microsoft CEO Satya Nadella, who took over the reins from Steve Ballmer in 2014 when the company was at the lowest point in its history. He took the top job after what many people called the company’s “lost decade.”

Under Ballmer’s leadership, Microsoft had drifted into irrelevance; Google became a search behemoth, Facebook (now Meta) took ownership of social media, and Apple introduced the iPhone and iPad. Microsoft’s internet presence and influence was vanishingly small. The company had thrown away billions of dollars on an attempt to build a Windows-based mobile operating system. 

As a result, Microsoft’s stock prices stagnated and fell. When Nadella took over 11 years ago, the price was lower than it had been at the end of 1999.

At the time the company’s woes seemed intractable. How could it claw its way back in a world in which it lost out on the internet, social media, and mobile computing? 

Somehow, Nadella managed to do it. He ended Microsoft’s ill-advised foray into building a mobile Windows OS, ended the corporate infighting and sniping, and recognized that Windows was no longer the company’s future. Instead, he bet big on cloud computing — and the bet paid off. Then he made an even bigger bet on AI and turned the company into a juggernaut with a value now approaching $4 trillion.

Even so, Nadella isn’t resting on his laurels. Instead, he’s running scared — in a good way. Earlier this month, he appointed Judson Althoff to be CEO of Microsoft’s commercial division. Keep in mind that at Microsoft, the CEO title no longer means head of the company.  Rather, people in charge of divisions are sometimes called CEOs. Mustafa Suleyman, for example, is CEO of Microsoft AI; Rajesh Jha is CEO of Microsoft Experiences and Devices; and Mikhail Parakhin is CEO of Microsoft Copilot. 

After Althoff’s promotion, Nadella retains his title of Microsoft CEO and Chairman of the Board. And it’s important to note that Judson’s background isn’t in tech, it’s in sales and marketing. For the last nine years, he’s been in charge of Microsoft’s global sales organization. 

Nadella made the change so he could put as much of his time and energy as possible into being more directly involved in AI. It’s a return to his roots and echoes the kind of work that propelled him to the top of the company.  Before joining Microsoft in 1992, he was a member of Sun Microsystems’ tech staff. He had a variety of engineering and tech-heavy jobs at Microsoft before becoming CEO, including president of the Server & Tools Division for three years before his promotion.

Going all in on ‘founder mode’

Nadella announced the move in a blog post. He said the shakeup will “allow our engineering leaders and me to be laser focused on our highest ambition technical work — across our datacenter buildout, systems architecture, AI science, and product innovation — to lead with intensity and pace in this generational platform shift.”

Key to understanding the change are the three words “generational platform shift.” It’s a shorthand way of saying that AI will transform the tech world and worldwide culture, and companies that take advantage of it will thrive, while those who don’t will be left behind. By focusing primarily on AI development, Nadella believes he can ensure Microsoft takes advantage of the generational shift. He recognizes there are times when tech companies can flourish by focusing on management and sales, and other times, such as now, when they need to go all in on developing new technology.

In Silicon Valley, there’s a term for when head of a company does what Nadella is doing and devotes his or her energies primarily to tech: founder mode. He’s worked at Microsoft for 33 years, and he saw how tech-savvy founder Bill Gates built the company into a tech behemoth, and how marketing-and-sales guy Steve Ballmer sent the company into a tailspin when he missed out on mobile computing, social media, and other groundbreaking technologies. 

Nadella’s move is a clear indicator he doesn’t want something similar to happen on his watch.

Jack Gold, principal analyst at J. Gold Associates, believes Nadella’s move was the right one. He told Computerworld, “There is a lot of this going on in the industry, as companies structure for growth in diversifying business areas. Having an exec running a critical business area like AI, while the remainder of the exec team focus[es] on growth and new business opportunities makes sense, given the amount of focus required.”

Nadella going all in on tech and leaving marketing and sales largely to someone else isn’t the move of someone content to take things easy. It’s a recognition that if Microsoft is to keep its lead in AI, and possibly extend it, he needs to devote his full attention to it. It’s running scared in the best possible way.