Management Fundamentals 5th Edition by Robert Lussier

Exercise 10

In 1975, Bill Gates and Paul Allen founded Microsoft, based on their vision of using a new technology to change the way business was done and to benefit and transform society. In their view, the future was in computer software, not hardware. At the time, IBM saw its business as primarily selling mainframe computers; the company's mission later expanded to include the sale of PC hardware. Bill Gates convinced IBM to use Microsoft software to operate its PCs. Although IBM eventually realized the value of developing its own PC operating systems and software, the company did not have much success. Even when IBM acquired Lotus Development Corporation in 1995 in an effort to add software (Lotus Notes, Lotus 1-2-3, Ami Pro) to its product line, the company was too late to catch up with Microsoft. And over the years, with competition from IBM clones, IBM continued to lose PC market share to competitors; eventually, the company's share of the PC market dropped below 5 percent. IBM's PC division was bought by Chinese company Lenovo on May 1, 2005.
Over the past 35 years, Microsoft has been a technology leader in transforming the way people work, play, and communicate. Microsoft Windows and other Microsoft operating systems and office software have dominated the market and continue to do so. Microsoft's mission is "to help people and businesses throughout the world realize their full potential." Microsoft has three core business divisions:
• Platform Products and Services Division. This division produces Microsoft's flagship product, the Windows operating system. The online service MSN, the search engine Bing, and the cable television station MSNBC are all part of this division. Also part of this division is Microsoft Visual Studio, the company's set of programming tools and compilers, and the Windows Server System, Microsoft's suite of server software.
• Business Division. The Microsoft Business Division produces Microsoft Office, which is the company's line of office software. This division also focuses on developing financial and business management software for companies.
• Entertainment and Devices Division. This division includes products for the mobile market (Smartphones, Windows Phone), MSN TV, computer games, online games, the handheld Zune media player, and the Microsoft Xbox game console.
Under Gates's leadership, Microsoft Corporation flourished, consistently landing in Fortune 's "100 Best Companies to Work for" and the "Fortune 500." Gates has also been recognized for his exceptional leadership, landing at number one on the "Forbes 400" list from 1993 through 2007 and number one on the Forbes list of "The World's Richest People" from 1995 through 2007. He was also recognized by Time magazine in their "Time 100" list as one of the 100 people who most influenced the 20th century, as well as one of the 100 most influential people of 2004, 2005, and 2006.
Gates's role at Microsoft for most of its history was primarily a management and executive role. He was known as a demanding and verbally combative boss, consistently encouraging creativity and recognizing employee achievements. He demanded that his colleagues be well informed, logical, vocal, and thick-skinned. Gates also met regularly with Microsoft's senior managers and program managers. During these meetings, Gates often interrupted presentations and proposals with such comments as, "That's the stupidest thing I've ever heard!" The target of his outburst would then have to defend his proposal in detail until, hopefully, Gates was fully convinced.
Effective July 2008, Gates transitioned out of a dayto- day role at Microsoft to a part-time role, where he serves as non-executive chairman and an advisor on key development projects. He now spends most of his time on his global health and education work at the Bill Melinda Gates Foundation, which is the largest transparently operated charitable foundation in the world. As of 2007, Bill and Melinda Gates were the second most generous philanthropists in America, having given over $28 billion to charity. Since July 2008, Gates has continued to serve as Microsoft's chairman, head of the board of directors, and an adviser on key development projects.
As CEO of Microsoft, Bill Gates had greater need for which skills?
A) technical rather than decision-making skills
B) decision-making rather than technical skills
C) a balance of both