'Got something wrong? Just make sure you get it right next time': Steve Ballmer's top business tips

'Got something wrong? Just make sure you get it right next time': Steve Ballmer's top business tips

Summary: The former Microsoft CEO has been handing out advice to would-be company founders at an address in Oxford today.

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TOPICS: CXO, Microsoft, Start-Ups
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Steve Ballmer onstage today at the Saïd Business School. Screenshot: YouTube

Succeed quickly, fail fast may be the mantra on the lips of every Silicon Valley startup, but Steve Ballmer's not buying the celebration of failure.

Former Microsoft CEO Ballmer was sharing his business tips with would-be CEOs of tomorrow at the University of Oxford's Saïd Business School.

The rhetoric around startups is that they succeed quickly and fail fast and that, believes the former chief exec, is just wrong.

"Sometimes you run out of money, fine, you fail, you move on. That happens," he said.

"What really great companies do, and great startups, is they don't fail fast," Ballmer added. "They modify ideas, they may see their core proposition needs to change, but it's a great team of people that's fired up, that's found a fertile area, and you just keep working it to be successful."

Those who want to set up their own businesses should prioritise tenacity and patience, and always take the long-term view, Ballmer advised.

He's certainly doing that when it comes to Microsoft's own challenges in recent years, particularly around mobile.

"If look at things in last 10 years, it's probably fair to say there are things that did not go as well as we intended them to. We would have a stronger position in the phone market today, for example, if I could redo last ten years. One of things you have to say to yourself is, do you give up?" he asked.

"I believe Microsoft is well enough capitalised that if we don't succeed, our job isn't to give up and go home, it's try to continue the initiative, but catch the next wave of rapid innovation."

The CEO is expecting a whole different set of hardware — potentially wearable — to be defining the next wave of mobility.

"Take the world 10 years from now, do you think we're going to use devices that look like any of the devices we have today? They will change. Whether they will be things we wear on our eyes or in our ears, devices will continue to change. Do you give up if you miss something, or keep investing for next wave?"

Over the course of the Q&A with the business school's students and dean, Ballmer also shared the best and worst pieces of advice he'd received in his career, and handed out his own tips for those looking to found their own companies.

The worst advice he got, said Ballmer, was to not to drop out of college to join Microsoft, given to him by fellow students and Stanford University.

The best was an aphorism from his father: "If you're going to do a job, do a job. If you're not going to do a job, don't do a job. And that is the key of everything."

"If you're going to do something, get it, heart, body and soul. Do it, and really care. Have the sort of brain where you're always thinking about it and worrying about it and caring about it...  Be all in or be all out."

Ballmer again counselled against the short-termist view that can sometimes characterise startup culture, saying that being "all in" is only useful if it comes without an expiry date – business founders can't just expect their big idea to start paying off within six months or a year, he added, citing the examples of Microsoft, Google, Oracle and SAP each taking over a decade to hit the big time.

Ballmer's basics

The former Microsoft boss advised students hoping to found their own company to concentrate on the most basic element of business: finding a price and business model that works.  

"Understand price. Think about price. Don't ignore price," he told them. Rather than going for the approach beloved by startups and Google alike – make something cool, worry about how to make money off of it later – Ballmer said fledgling businesses must put their bottom line front and centre.

"You take all these fancy classes – people want to teach about marketing, want to teach about finance, now there's a whole craze – teaching about product development, scrum, rapid, innovate and blah de blah. I got to tell you this thing called price is really important – price/business model. I still think people underthink it through.

"You get a lot of companies start that have no business model, you have a lot that start where the only difference between the ones that succeed and the ones that fail is one figured out how to make money because they were deep in thinking through the revenue, price, and business model. I think that's under attended-to generally, there's probably more that can be done outside the school of hard knocks to learn that."

Ballmer also suggested the students turn their attention to learning all types of accounting, joking that had he not dropped out of Stanford, he'd have taken more courses on the subject.

"Pay attention to accounting. I don't just mean in a financial accounting sense... management accounting even more important than financial accounting - really deciding and thinking about what are you measuring, how do you account for revenue, how do you think about cost. It's fundamental."

Knowing how to recruit is also a top skill, according to Ballmer – for small companies hoping to grow, recruitment becomes the responsibility of all staff who are hunting for the most talented people to join their team.

"It turned out the most valuable thing I added to Microsoft was I got the hiring machine going because I had interview for a lot of jobs in college in business school.

"It's life blood, even to my last minute at Microsoft. The last thing I did was a recruiting call," he said.

Those calls are now the responsibility of Satya Nadella, Microsoft's new CEO, appointed last month.

While Ballmer may have given up the top job, he revealed today that he still sees Microsoft as one of his children.

"And what's the greatest joy a parent can get? To see their child flourish when they go away."

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Topics: CXO, Microsoft, Start-Ups

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21 comments
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  • Advice

    It’s very hard to give advice to people in order to lead them to success. One thing I have noticed is that most people hear the advice that you tell them, but don’t really listen. Another thing I have noticed is that successful people follow their own unique path. There is no way to account for and duplicate accidental connections, personality traits, and life experiences. Rarely is advice given to accommodate the exact scenario to which it is needed. For example; you can follow advice from Ballmer, but it doesn’t mean you will have the exact some outcome. Ballmer made $120 billion in Profit for Microsoft, it would be easy to do worse.
    Sean Foley
    • You are quite right

      "people hear the advice that you tell them, but don’t really listen."

      Every day you get told to go elsewhere to shill and troll for MS, but you are still here.
      1,2,3
  • 'Got something wrong? Just make sure you get it right next time': Steve Bal

    Great advice from a very smart business man. You can't be the CEO of Microsoft for years and not know what you are doing. Steve Ballmer knows what he speaks of. Modify the business plan which is what Microsoft has done on a number of occasions. Hope he does just as well on his next adventure.
    Loverock.Davidson
    • Doesn't seem very deep

      ... at all, really.

      More like he's quoting a Gerry Rafferty tune from the 1970s.
      dilettante
    • Hmmm, I don't know about that

      One wonders what another CEO might have done and where MS would be today with different leadership.

      How do we judge if his tenure was a success? Was he just riding the wave and momentum of Gates' work on Windows, or the success of Office? His attempt at redefining MS has so far failed, as has efforts in Mobile, and his trust in Sinofsky appears to have been a mistake.

      It seems as though the work to get to the CEO suite is tough, but once there, you are protected by a golden parachute. If your bets pay off, you claim that it was all you, that you had "vision". If your bets fail, you blame others for not having enough "buy in". If all else fails, you load the bags of money on to your helicopter and fly away.

      Im not saying I dislike Ballmer, I just wonder how to fairly evaluate a CEO's performance.
      otaddy
      • "Was he just riding the wave and momentum of Gates' work on Windows, or ...

        ... the success of Office?

        I assume this is just a rhetorical question given it is a perfect description of his tenure.
        dfolk2
        • Let's continue this train of thought

          If Nadella fails, is it because of him or is it because of all of the existing problems he inherited? Is MS too far gone to be saved at this point?

          Look at Mayer at Yahoo. Is she a success or is she just benefiting from the previous administration's investment in Alibaba?

          What criteria can we use to fairly evaluate a CEO's performance?
          otaddy
    • Being CEO of Microsoft no barometer of knowing what you are doing

      Seeing as how Steve Ballmer was mostly babysitting the cash cows of Windows and Office and failing at almost everything else shows that anyone could have done his job. In fact Windows Me, Vista and Windows 8 showed all he was doing was damaging what cash platform they had. And many Office users don't want to use anything past Office 2003, the so-called "improved" versions. Clearly Steve Ballmer as CEO of Microsoft had no idea what he was doing. The only people who look more foolish than Ballmer T. Clown is Bill Gates and the MS Board allowing this buffoon to continue long enough to cause irreparable damage to the brand. Microsoft has betrayed its customers and partners too many times.
      PaulG53
  • So let's see how HE has done.

    In 2000, Ballmer becomes CEO.

    In 2001 we have Windows XP...good operating system.

    Next came the bow-wow that was Vista. That went over well.

    So next we have Windows 7. Another good operating system. Good recovery Steverino.

    In 2013...we get Windows 8. Another Vista moment perhaps? Deja vu all over again?

    Also in 2013...Ballmer announces his retirement. Not wanting to stay around and "...make sure you get it right next time" is he?

    Could the two events be connected by any chance? One wonders.
    IT_Fella
    • You left out

      Surface, Surface RT, Kin, Zune. Windows Phone . . .
      1,2,3
      • In fairness

        there has been some success for MS in varying areas such as servers. The real question is whether those happened because of Ballmer or despite him.
        1,2,3
      • OneLeftFoot, what about...

        ...Xbox, Windows Server, SQL Server, SharePoint, Office 365, Outlook.com (or Hotmail)?
        jaykayess
  • "Just make sure you get it right next time"

    So we can expect Windows 8 to be dropped, buried and replaced with an appropriate OS for desktop use?
    dfolk2
  • blah de blah.

    sums it up nicely. time to shut up steve.
    DontUseMicrosoftAtAll
  • I sure wish he took his own advice!

    Yes, Price is the key. Two types of analysis: a) will what I SPEND provide BENEFITS which more than outweigh the added cost? b) Can I afford it?

    For most of business, the answer to b) for MS stuff, has been NO, because MS didn't perform a) properly. The cost of RETRAINING for their stupid interface changes and incompatible drivers, other problems too numerous to mention -- were way to high. It wasn't the cost of the license; it was the cost of RETOOLING machines and people for the new stupid changes they made. A sane CEO would have seen all that immediately, and kept the end user experience the same. Ballmer didn't.

    So now billions of dollars and hours of lost time later, he retires. With us left with dysfunctional OSes, despite him lucking out with XP, which after all was already in the hopper before he became CEO. Why didn't he learn from XP's success?

    This is the last guy I'd let lecture my students. He clearly FAILED to obey the very advice, he gives.
    brainout
    • More...

      Typo correction: "way to high" should read "way too high". Next, Nadella can still rescue the mess he inherited, if:

      1. He offers an ANNUAL FEE SUBSCRIPTION for support to plug leaks, maybe bug enhancements, maybe pass on the improvements in Vista et seq. OSes, to XP users. Count the 'leaks' as a basic subscription, 'bug enhancements' (like making XP able to read/write data DVDS' as 'premium' subscription, then for the passing on of the improvements, 'platinum'. INTERFACE DOESN'T CHANGE. That's the key. Priced properly, MS will make profit bigtime, and we the end users will be in love with MS all over again.

      2. Change the motto, for crying out loud, to 'YOUR Microsoft', instead of 'One Microsoft'. Show that you actually care the way Ballmer claims he did. Then make it so.

      3. One way to make it so, is to DIVORCE THE DESKTOP from the OS, and from MS Office, so users can CUSTOMIZE them fully again, like they could in MS Office 2003 and prior, and in XP. Make that EASY to do. Charge for it as an extra add-on, that way you can track popularity.

      4. RESTORE BACKWARDS COMPATIBILITY so that we can still read our old records from 30 years ago. Again, since MS has already proven it can do this by its UnblockExcel.reg and UnblockWord.reg patches, do it for anyone -- and CHARGE for that. This helps track popularity, too.

      There's more I want to say, but the post is long already. If you've read my many posts before, I herewith incorporate them all by reference.
      brainout
  • Price is important, BUT...

    ...for startups, cash flow is even more important. One of the factors why so many startups fail is that they are funded by "OPM" (other people's money), so nobody's watching the cash flow or profits. When the funding runs out, that's the end of the road.
    jaykayess
  • Same old...

    Without getting embroiled in the love/hate drama of Microsoft specifically, does anybody really get anything unique out of these ex-CEO "how I did it" interviews? They are all pretty much generic chestnuts from the management books, along with a few specific incidents highlighting what in retrospect worked out. I'm still waiting for the breathless interview with the failed/fired CEO where he says, "Wow, I really botched THAT one..."
    Biotechguy
  • Absolute...

    Rubbish on so many levels Ballmer....

    1..Your "beloved" company already had the capital to keep afloat before you took over and made so many wrong decisions you could keep afloat
    2..It's ok to have a belief in a product and tell it to the younger generation..>AS LONG AS IT DOESNT INTERFERE WITH MICROSOFT'S PRODUCTS, as they would just extinguish your product
    3..It would be a pleasure for a startup to make such catastrophic mistakes like you have and still be in a position to rectify them the next time. Windows 8 being a prime example.
    4...Your best OS (XP) was mainly desinged before you got to the helm and you have followed it up with constant drivel up until Windows 7 and now continue to ignore your install base repeatedly
    5..And a big Number 5...Not many CEO's can announce retirement and the companies shares go higher and still have tenacity to show their face in public and tell our kids how to run a business

    Ballmer, good riddance you added ZERO to IT over the last 14 years
    Bladeforce
  • Ballmer

    Translated to English....'when your gut tells you not to listen to lower management [Win 8], do it'
    electric800