Gates Easing Out of Daily Functions at Microsoft

Microsoft Corp.’s Bill Gates will cede his day-to-day role with the software giant in two years to spend more time on the philanthropic health and education initiatives of the Bill & Melinda Gates Foundation, a company statement said last week.

Gates will work full time at the Redmond, WA-based company through June 2008, after which he will continue his role as the company’s chairman and advisor on key development projects, the company said.

Microsoft announced that Chief Technical Officer Ray Ozzie would immediately assume the title of chief software architect and begin working side-by-side with Gates on all technical architecture and product oversight responsibilities, to ensure a smooth transition. Similarly, Chief Technical Officer Craig Mundie will immediately take the new title of chief research and strategy officer and will work closely with Gates to assume his responsibility for the company’s research and incubation efforts; Mundie also will partner with general counsel Brad Smith to guide Microsoft’s intellectual property and technology policy efforts.

“Our business and technical leadership has never been stronger, and Microsoft is well-positioned for success in the years ahead,” Gates said in a statement. “I feel very fortunate to have such great technical leaders like Ray and Craig at the company. I remain fully committed and full time at Microsoft through June 2008 and will be working side by side with Ray and Craig to ensure that a smooth transition occurs.”

“This was a hard decision for me,” Gates added. “I’m very lucky to have two passions that I feel are so important and so challenging. As I prepare for this change, I firmly believe the road ahead for Microsoft is as bright as ever.”

In August 2005, Microsoft appointed Kevin Turner as COO. A month later, the company’s CEO Steve Ballmer organized Microsoft into three divisions under presidents Jim Allchin, Kevin Johnson, Robbie Bach and Jeff Raikes, who were given much greater responsibility for product development and strategy decisions within their respective businesses.

“Bill and I are confident we’ve got a great team that can step up to fill his shoes and drive Microsoft innovation forward without missing a beat,” Ballmer said in a statement. “We will continue to hire the world’s best technical talent and give them the tools to do their best work, and we will continue to tackle the biggest challenges and opportunities for our customers by investing for the long term.”

Ballmer and Gates noted that Microsoft has been steadily expanding its senior leadership in recent years, and that the announcement continues a transition process that has been underway for several years. In January 2000, for instance, Gates assumed the role of chief software architect and Ballmer assumed the role of CEO, responsible for all day-to-day operations and company business strategy.

“This is a very sensible and thorough approach,” said Dr. James I. Cash, member of the Microsoft board of directors in a statement. “A two-year transition will ensure that the company has a smooth transfer of strategy and knowledge from Bill to the next generation of leaders. Steve and his management team are very impressive, and I’m confident the company will not miss a step.”

Founded in 1975, Microsoft has 63,000 employees in more than 100 countries and generates annual sales of more than $40 billion.