10/24/2013 02:33 pm ET Updated Dec 24, 2013

Is There a Jacqueline Welch at Microsoft?

Now that Uncle Fester has announced his long-awaited retirement, the business media is left guessing about his successor. With its recent purchase of Nokia's handset business (and possibly its next CEO), the chattering masses have quieted down on speculation about Microsoft's next CEO. But whether that title will go to Nokia's Stephen Elop (a former Microsoftie) or not, it's still worth considering what, exactly, Microsoft needs in a CEO at this point in time.

Compare Microsoft to two other behemoths that were left floundering around when the world changed: IBM and General Electric. In the early 1990s, IBM was on the brink of going out of business, thanks to the likes of Microsoft, Intel, Motorola and Compaq. Plans were in the works to sell off chunks of the company and turn IBM into a shadow of its former self -- I've Been Mangled? Louis Gerstner, an industry outsider, was brought in to turn IBM around. As a prior customer of IBM (he was CEO of Nabisco, and before that of American Express' travel related services group), he knew a thing or two about IBM's failings. He famously declared after he took over as CEO, "The last thing IBM needs now is a vision."

General Electric was in a similar situation in 1981 when Jack Welch took the helm. It was a bloated conglomerate with many sub-par businesses in a world that increasingly demanded more focus. During Welch's 20-year stint as CEO and Chairman, GE shed its massive bureaucracy, closed factories, sold businesses and reduced its payroll by 112,000 employees. But GE also bought more than 100 businesses. Welch increased GE's market value by 4,000 percent, in part, due to his insistence that the company be either #1 or #2 in each industry it competed or else exit the business. Trained as a chemical engineer, Jack Welch was a left-of-center insider who bristled at big corporate rules. It's somewhat miraculous that he kept his early job at GE after an explosion at the factory he managed blew the roof off the building.

So what does Microsoft need? Probably not a vision. It needs a strong manager, who is slightly left-of-center and willing to break the rules, but has credibility with important constituents (i.e., software engineers). Microsoft made its money by being the 800-pound gorilla in the software business. Ninety percent of its profits come from Windows and Office.

Should Microsoft's Next CEO Be A Woman?

Given that the board members are all handpicked by Microsoftie-in-Chief, Bill Gates, I predict that they will install a man with all the proper business and financial credentials. That poor guy will be forced to manage under Microsoft's stated strategy (flog sales of Windows and Office on everything mobile), which the board has said is set in stone. A step in the right direction would be a left-of-center insider -- male or female.

What Microsoft really needs is a smart and tech savvy manager with the backbone to stand up to the board and reign in the dominant software culture. Despite the fact that Microsoft spends 13 percent of its sales on R+D, the company continually "creates" products that are follow-ons from its competitors' hits (Azure, Bing, the Surface, a mobile operating system, Zune, the list goes on and on). Microsoft's reorganization earlier this year was designed to enable its transformation to a "devices and services company." In other words, it is trying to become more IBM-like and offer a range of "solutions," rather than a bunch of disparate software and hardware products. But to sell solutions, you need to break the rules in order to be effective. And you need to be good at communicating and integrating various stakeholders who often hold opposing views. Another "yes man" is not going to succeed at that. So how about a clever woman with demonstrated success at managing in a male-dominant culture? Bring on a current (or former) Microsoft maverick woman! There's got to be a Jacqueline Welch or Louise Gerstner out there who can turn this beast around.

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