What Did Steve Ballmer Do Right as Microsoft's CEO?

Jacob Harper |

There’s not misreading investor sentiment towards soon-to-be-exiting Microsoft Corp. (MSFT) CEO Steve Ballmer. On the day he announced his intention to resign from the company in 2014, Microsoft’s stock shot up a whopping 6.85 percent.

The failures of the “Ballmer Era,” which began in 2000 after founder Bill Gates stepped down, are easy to articulate.

Under Ballmer's watch the tech company went from a $400 billion valuation at the time of his coronation to its current market cap of $285 billion. The “stack ranking” employee evaluation system he instituted that pitted departments against each other stifled innovation and bred a toxic corporate culture. Microsoft's attempts to break into search with Bing have been a disaster, costing the company almost $11 billion and counting.

And most importantly, Microsoft’s flagship product – the PC – has been steadily losing out in the worldwide shift to mobile, while the tech giant has spectacularly failed to adapt, and in the second quarter of 2013 wrote off  $900 million on losses accrued from their tablet, the RT Surface.

But what doesn’t get much press as Microsoft’s failures under Ballmer’s tenure are their successes. A lot of Microsoft’s failures have been beyond his control, like the tech bubble that accounted for a sizable chunk of Microsoft’s early losses under his watch. Ballmer, in many ways, has always been reacting to the first tech bubble, and in many ways has done quite well.

Here are the biggest successes of the Ballmer Era:

1) Windows XP

Introduced near the beginning of the Ballmer Era in the summer of 2001, the XPO was the defining Operating System of the early aughts. In a competitive marketplace, XP’s success continued unabated for over a decade, and the OS remained the most popular in the world, until being overtaken by another Microsoft product, Windows 7, in 2011.

At its peak in November 2007 XP was used by 83.78 percent of desktop users, a feat that will probably never be equaled.

2) Kinect

Microsoft’s software that allowed users to interact with the Xbox without actually touching anything was an astounding technological breakthrough for the company. Kinect uses motions sensors and a range camera to interpret movement, and greatly enhances the Xbox gaming experience.

The device has proven insanely popular. Designed as an add-on for the Xbox, the Kinect has sold 24 million units, and set the Guinness record for the fastest selling consumer electronics device ever, selling 8 million units in 60 days.

3) The Xbox

Microsoft’s biggest success under Ballmer is unquestionably the company’s foray into gaming. While video game consoles can be a tricky field to navigate, the Xbox has been an unmitigated success. While the development of the console hasn’t been without its hiccups, including a spat with gamers over the right to sell and trade used games, the console has proven popular with fickle gaming consumers, and has been especially successful in the 18-34 male demographic.

The newest iteration of the console, the Xbox One, is expected to come out in November 2013.

(Image: Steve Ballmer at CES in 2010, courtesy of Wikimedia Commons)

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Symbol Name Price Change % Volume
MSFT Microsoft Corporation 61.37 1.42 2.37 30,808,969
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