Microsoft Corporation’s Structure, Culture, Power Distribution


Microsoft Corporation is a renowned software company that has dominated the industry for at least four decades since its inception in 1975. However, over the last few years, the reputation of Microsoft has witnessed a declining trend that raises concerns regarding the company’s performance. The exit of Bill Gates as the company’s Chief Executive Officer (CEO) in 2000 influenced the need for changing Microsoft’s structure. This transformation further affected the company’s organizational culture as well as its distribution of power. Hence, it is crucial to evaluate Microsoft’s current structure, culture, and the distribution of power to gauge its performance and innovation prospects in its industry.

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Microsoft’s Current Structure

Microsoft’s current structure is well suited to boost the company’s innovation and collaboration agendas. As Robbins and Judge reveal, the organizational structure of a company influences its performance considerably since it shapes aspects of collaboration and innovation (481). The exit of Bill Gates from Microsoft Company close to two decades ago had a significant effect on this organization’s structure (Eichenwald). The reign of Bill Gates forced Microsoft to adopt a vertically integrated structure, which facilitated a top-down decision-making approach conducted by the company’s executive team. Nonetheless, significant changes introduced in the organization after Bill Gates stepped down from the CEO position have seen the company embrace a new structure that seeks to enhance the attainment of the set organizational goals (Gunner 24). This supportive organizational configuration shows that indeed this technology-focused company upholds a collaborative and innovative strategy in its operations amid experiencing organizational changes.

Currently, the Windows Server System Reference Architecture guides Microsoft’s organizational structure (Jacek and Jarosz 101). Microsoft’s configuration constitutes the Centralized Data Center (CDC), Department, Branch Office, Extranet, and the Internet Data Center. The CDC aspect of this company’s organizational structure fosters collaboration within its business units because it focuses on establishing a supportive environment that streamlines the provisions of enterprise level services. Therefore, it is logical to conclude that Microsoft’s organizational structure encourages its employees to operate collaboratively to achieve the goal of offering innovative services that seek to meet customers’ needs and expectations in this highly competitive market.

The Department aspect of Microsoft’s current structure also fosters the realization of collaboration. Despite the existence of independent departments within Microsoft, there is still a sense of collaboration geared toward the achievement of shared goals and objectives. Robbins and Judge argue that various departments within an organization may function collaboratively by ensuring all activities set for each unit lead to the attainment of a common goal in line with the particular organization’s mission and vision (5). In this view, Microsoft’s independent departments uphold the separation of goals, tasks, responsibilities, and costs among other management responsibilities. As such, this company manages to cultivate a collaborative environment in its current structure, despite the presence of departments that function autonomously.

The Branch Office is also a structural aspect that enhances the collaborative aspect of this software company. This component focuses on providing local services to consumers. The Branch Office as an aspect of Microsoft’s structure enhances innovation by constantly identifying areas that require technological advancements. As a result, it bolsters the modernization of Microsoft’s operations. Although the Satellite Branch Offices (SBO) element does not concentrate on offering services to customers at local levels, it enhances collaboration by facilitating the implementation of the organization’s actions in various regions (Kavoura et al. 107).

Moreover, the supportive organizational structure has been integral in enhancing collaboration among various units that make up Microsoft Corporation. However, there is the need to create an organizational structure that embraces more interdependence compared to the current level of autonomy and separation demonstrated in this organization (Kavoura et al. 83). Such a move can enhance the realization of a more collaborative approach geared toward meeting customers’ needs through innovative strategies. Specifically, the Extranet component of Microsoft’s current structure may be more effective in meeting this company’s collaboration and innovation goals (Kavoura et al. 96). This element can be tapped in a manner that can allow Microsoft’s corporate partners as well as employees to access important information easily, thus bolster effective communication and collaboration. Furthermore, the Internet Data Center element of the company’s structure may be deployed to help various entities to effectively connect with customers. The level of innovation and collaboration witnessed after implementing these structures may go a long way in enhancing Microsoft’s performance and productivity.

Microsoft’s Culture

An organization’s culture refers to its unique manner of conducting business. The organizational culture adopted by a company needs to take into account factors such as internal business processes, labor market conditions, the respective industry’s situation, and the nature of its operations (Robbins and Judge 520). In particular, Microsoft organizational culture is characterized by accountability, innovativeness, responsiveness to customers, diversity and inclusion, and a growth mindset. In this respect, this culture is compatible with the company’s current structure because it encourages workers to embrace resilience while at the same time addressing dynamic needs that emerge in the computer software and hardware sector.

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The organizational culture adopted by Microsoft depicts a significant degree of compatibility with the company’s new organizational structure. Microsoft’s new organizational arrangement enhances business growth, regardless of executive management changes experienced in the company after Bill Gates’ exit (Eichenwald). Accountability as one of the leading attributes of organizational culture is compatible with Microsoft’s new structure since it emphasizes the need for employees at all levels to execute their tasks and duties in the most productive way possible.

Microsoft’s current culture is well suited to enhancing remarkable performance and innovation. For instance, this company expects its employees to uphold quality standards as well as innovativeness. As a result, this organization has managed to attain high levels of competitiveness in the computer software and hardware sector. Microsoft regards the aspect of responsiveness to customers as an important part of its culture. To achieve its goal of remaining receptive to its clients’ demands, it has integrated systems that value customers’ feedback (Clydesdale 5). The new structure at Microsoft is comprised of units headed by professionals from different backgrounds. This configuration enhances the compatibility of the company’s corporate culture, which upholds the essence of diversity and inclusion.

However, I would change the current culture by emphasizing the need for close employee-employee and worker-employer interactions and shared forums whereby various performance issues can be addressed (Gunner 28). Although the company has created room for this interaction, some pertinent matters raised by clients remain unaddressed. For instance, through such forums, problems raised by SkyDrive Pro customers may be addressed. According to Robbins and Judge, such a teamwork strategy can enhance Microsoft’s competitive edge against rivals such as Apple, Google, and IBM, especially when this organization’s employees come up with ideas that effectively address customers’ demands (308). To achieve this goal, Microsoft’s employees may need to be trained further on the issue of paying closer attention to the feedback provided by customers who are the most valuable assets for renowned businesses (Clydesdale 2). Introducing this culture of responding to clients’ demands promptly may enhance the aspect of service excellence and, consequently, productivity. Integrating this strategy into the company’s corporate culture further fosters the realization of a growth mindset that is vital to the company’s long-term success.

Microsoft’s Power Distribution

Organizations are made up of individuals and groups that hold varying degrees of power. In this view, job titles or specialized knowledge and expertise determine the power and authority of different stakeholders and coalitions within an organization (92). Some partnerships may have a greater authority and powers compared to others. As such, issues regarding the supremacy of various alliances influence relationship levels among different departments within a particular company (Clydesdale 7). Senior job titles in Microsoft Company hold the greatest power in comparison to others. In particular, the notable coalitions that hold the greatest level of power within Microsoft include the office of the CEO and the Board of Directors.

Microsoft has global corporate groups that constitute the company’s business structure. However, Microsoft Company’s current CEO, Satya Nadella, is the most powerful leader in this organization. This official sources his power from the Board of Directors. Microsoft’s Board of Directors is the most powerful coalition in this corporation. Members who serve in the Board of Directors team get authority from their respective governments. Microsoft’s team of directors has its powers stipulated in the U.S. Constitution.

These most powerful coalitions have played a huge role in helping Microsoft to meet its goals regarding collaboration, innovation, performance, and productivity. For instance, the Board of Directors has worked closely with the current boss to initiate strategies that seek to enhance the company’s competitive edge in the computer business industry. For example, the need to enhance Microsoft’s mobile management strategy rests upon the powers of the CEO. Furthermore, the CEO is responsible for the way Microsoft conducts its daily operations. As such, Nadella reports to Microsoft’s Board of Directors regarding the progress of this globally renowned organization. In addition, the CEO job title is powerful since Nadella has the power to appoint managers, including the President and the Vice President.

The current team of directors constitutes 10 members headed by Nadella. This group has informed the decision for Microsoft to appoint experienced individuals whose input has been significant toward enhancing the organization’s profitability. For instance, Bill Gates, the company’s co-founder and advisor, is an influential director who facilitates the company’s transition process. The Board of Directors also constitutes Steve Ballmer, the organization’s former business leader whose experience in the company’s operations cannot be overlooked. The coalition of vice presidents has been given authority to oversee the operations of various units within this organization. Therefore, the office of the CEO and the Board of Directors influence the majority of Microsoft’s day-to-day operations.

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Microsoft Corporation is a giant in the computer software and hardware sector, despite the turmoil that dented the reputation of this company in the recent past. Its organizational structure adopts product-type divisions guided by the Windows Server System Reference Architecture. The prevailing corporate structure seeks to streamline the operations of this organization to achieve collective success amid the existence of independent departments. Microsoft’s organizational culture also plays an essential role in fostering its current performance and levels of innovation. This company has strived to demonstrate elements such as accountability and responsiveness to customers through its quality products and innovativeness. Moreover, the Board of Directors and the leadership team constitute the most powerful coalitions within Microsoft.

Works Cited

Clydesdale, Greg. Human Nature: A Guide to Managing Workplace Relations. Routledge, 2013.

Eichenwald, Kurt. “Microsoft’s Lost Decade.” Vanity Fair, Web.

Gunner, Dave. “Complexity and Turbulence as Triggers for Change.” How Successful Organizations Implement Change: Integrating Organizational Change Management and Project Management to Deliver Strategic Value, edited by Emad Aziz, and Wanda Curlee, Project Management Institute, 2017, pp. 23-44.

Jacek, Doktor, and Pawel Jarosz. Deploying Microsoft System Center Configuration Manager. Packt Publishing Limited, 2017.

Kavoura, Androniki, et al., editors. Strategic Innovative Marketing: 4th IC-SIM, Mykonos, Greece 2015. Springer International Publishing, 2016.

Robbins, Stephen, and Timothy Judge. Organizational Behavior. 15th ed., Pearson, 2013.

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