The writing is on the wall: People are buying tablets and smartphones. The PC will never go away, but there's no growth left in those markets. Under Ballmer, Microsoft tried and failed over and over again to make an impact in the mobile space.
Say you have 100 people in your division and five of them really aren't much good. Too bad. As a boss, you still must label five otherwise OK employees as failures. At the same time, you have to fight to make sure your department doesn't fall into the 10 percent pit or you're likely to be in the unemployment line soon too.
Combine this draconian system with Microsoft's annual attempts to reorganize itself. After years of minor shakeups, Microsoft decided to really and truly reorganize itself to focus on shifting the company from a software company to a devices and services one; to make it "One Microsoft," a more agile and responsive tech company.
It was a nice idea. Microsoft divisions had fought like cats and dogs in a sack thrown into the river. There was no "One Microsoft." There were divisions fighting among themselves for the top and some that were clawing for simple survival.
Microsoft's board didn't think Ballmer could do it either. They appear to think that Ballmer couldn't change a toxic corporate culture into one capable of dealing with a far more competitive business landscape than the one Gates faced as a start-up in the 1970s.
5) The market didn't believe in Ballmer
Ballmer was never really a good CEO choice. He was always first and foremost a salesman . But, when year after year all he could had to sell was sizzle instead of steak, the market turned against him.
In January 2000, Ballmer became CEO. On August 22, 2000, Microsoft's stock closed at $35.62. On August 22, 2013, it closed at $32.39. If you look at Gates' last days in 2000, when the stock was around $55 a share, it's decline is even worse.
For over a decade Microsoft has largely declined in real value. Its rivals? Apple's currently at $501.42 and Google's at a mind-bending $871.29 a share.
Is it any wonder that for years analysts have been screaming for Ballmer to be shown the door. Unsurprisingly, now that the market knows Ballmer is leaving, Microsoft's stock has bounced up about 6-percent.
Where does Microsoft go from here? That's a good question and I don't have a good answer.
What I do know is that it needs radical change. Yes, it still make billions, but in 2013 it's still a PC operating system and business PC software company in a world that's turned from PCs to smartphones, tablets, and the cloud. To remake Microsoft, even with all its riches, into a true 21st century technology company is going to take radical change.
It can be done. IBM did it. General Motors and Ford did it. Until we know who will take over Microsoft's reins we can't even really guess if Microsoft will be able to do it.