Microsoft says it is reshuffling its business to promote faster innovation and a sharper focus on devices and services. The move by the world's largest software maker comes amid a steady decline in demand for PCs as people turn to tablets and other mobile devices.
Microsoft Corp. CEO Steve Ballmer said in a memo to employees Thursday titled "One Microsoft," that the changes mean the company is "rallying behind a single strategy" and organizing by function.
Microsoft's new divisions include engineering, marketing and business development.
The company named veteran executive Julie Larson-Green head of its devices and studios engineering group, overseeing hardware development, games, music and entertainment. She had been promoted in November to lead all Windows software and hardware engineering after Steven Sinofsky, the president of its Windows and Windows Live operations, left the company shortly after the launch of Windows 8.
Terry Myerson will lead Microsoft's operating systems and engineering group, namely Windows. Qi Lu will head applications and services.
GeekWire's Todd Bishop acknowledged that many of the leaders at Microsoft are simply "retiring" under the restructuring plan.
Ballmer stressed the company's focus on "one Microsoft" in his memo. He said Microsoft will move forward operating as a cohesive company rather than a "collection of divisional strategies."
"Any change like this is just super complicated," said Bishop. "It's a company of more than 100,000 people and it's hard to move that quickly."
With the retirement of some of Microsoft's top leaders, once again, there is no "heir apparent" to become the next CEO of the company, when it's time for Ballmer to step down.
"We've actually seen the departure of a number of potential heirs to the CEO position in the years leading up to this massive change," said Bishop. "For one reason or another - those people leave regularly. And here we're seeing something that where there is not an heir apparent among these executives."
Microsoft shares rose 50 cents to $35.20 in Thursday morning trading. The Redmond-based company's stock is up 32 percent since the start of the year, compared with a 17 percent increase of the Standard & Poor's 500 index.
An Associated Press report with contributions from MyNorthwest.com's Alyssa Kleven.
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