The balmy days of August were livened up, corporately speaking, with Steve Ballmer’s 
announcement that he would step down as CEO of Microsoft sometime in 2014. The race begins to find the individual who will take on this epic leadership challenge. Given Microsoft’s position as a leading global technology business, the person specification attached to this Executive Search brief will be bursting with superlatives.
Media commentary on the announcement has inevitably focused on his tenure as CEO. If you Bing (I would normally have said “if you Google”, but that would have been a cheap shot) “Steve Ballmer” you have to dig deep before you find anything positive written about him. Once you get past the announcement, the viral videos of “crazy Steve” on stage you are presented with articles such as:
Steve Ballmer’s Mixed Legacy (WSJ)
Steve Ballmer – Six big misses at Microsoft (Economic Times)
Why Steve Ballmer failed (New Yorker)
Steve Ballmer failed to take Microsoft beyond the PC (Bloomberg)
Steve Ballmer: The. Worst. CEO. Ever. (Pando Daily)
Is this all one can expect as an outgoing CEO after devoting a lifetime to building a world beating business? Do the facts stack up to this mainly negative narrative?
Microsoft. Where it all began.
Steve Ballmer was Microsoft’s 30th employee back in June 1980 (when it had revenues of only $7.5m!) when he joined the (as yet) unincorporated Microsoft as its first business manager. After holding several leadership roles, he was appointed CEO in January 2000 when Bill Gates moved to the role of Chief Software Architect. Mr Gates relinquished this role in 2006 when he moved to his current role of Chairman.
What kind of business did Steve Ballmer inherit?
Revenue $19.7bn, operating income $9.93bn and net income $7.78bn.
Cash reserves $17.2bn, R&D spend $2.97bn. (Full year 1999)
How are things now, after 13 Ballmer years?
Revenue $77.8bn, operating income $26.7bn and net income $21.8bn
Cash reserves $77bn, R&D spend $10.4bn
His operational scorecard includes: 
1. Quadrupled revenues (x 3.95)
2. Quadrupled cash (x 4.4)
3. Trebled operating profits (x 2.7)
4. Reduced profitability (net income/revenues declined, 39.5% to 28%)
5. Acquired 110 businesses (that’s one every 6 weeks!) including the likes of Visio, Great Plains, Navision, Skype and Yammer as well as taking multiple minority stakes and making several divestments.
6. Led an Executive team with almost 100,000 employees in over 100 countries
That’s some scorecard! One of which, I suspect, the majority of business executives and CEOs would be extremely proud.
You might have thought that delivering these results would secure his place among the leviathans of corporate America. You’d be wrong. The fundamental responsibility of a listed company CEO role can, it appears, be distilled down to a single indicator.
In 1999 Microsoft’s market capitalisation was $400bn. It was THE most valuable company in the world. It’s market cap is currently around $285bn. 
That’s a 28.7% decline in value, the equivalent of almost $9bn each year. Steve failed to move the value creation needle and so it’s game, set and match to his critics.
It’s difficult to disagree that value creation is not the domain of the CEO but let’s dig a little deeper. When he inherited the world’s most valuable and (probably) profitable company, there was really only one direction to go, especially as Microsoft’s P/E ratio in the first quarter 2000 was a sizzling 58. Its PE today is a more modest 13.2, or 77% lower. (Apply the earlier PE today and he’d be handing over a $trillion business).
Jeffrey Immelt CEO GE
If CEOs are also responsible for the froth of a bull market, then it’s fair to say Mr Ballmer gets an “F” for his tenure. He’ll be in good company, Jeffrey Immelt, CEO of GE, inherited a business in September 2001 valued at $415bn which today is worth $240bn. Timing, as they say, is everything!
In the meantime, while the jury continues to pontificate on your legacy, Mr Ballmer, there’s still time for one more of your crazy dances.
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