3 Leadership Lessons From Microsoft, the Drucker Institute's Best-Managed Company - Deepstash

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Microsoft Is Doing It Best

Microsoft Is Doing It Best

Values drive corporate performance. My research concludes that a specific set of values drives sustained success. As I wrote in Value Leadership, these values are embodied in seven principles such as fulfilling your commitments, valuing human relationships, fostering teamwork, winning through multiple means and fighting complacency.

The Drucker Institute has its own ideas of what makes for a successful organization and it has concluded that 2021's best-managed company is Microsoft.

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Leadership Lessons

Microsoft -- whose stock price has soared 681 percent since Satya Nadella took over as CEO in June, 2014 -- has increased its overall score more than any other company tracked by the Drucker Institute since it began publishing this ranking in 2017.

Here are three things that contributed to Nadella's success and how business leaders can use them to benefit their organizations.

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Create a culture of customer value creation

Most new leaders change the culture as the first order of business. Nadella changed Microsoft from a company that pushed its products on customers -- without regard for whether they were best for the customer -- to one that put customers first.

Follow Nadella's approach to cultural change so your company can attract and motivate the best employees -- and they will help you win and keep more customers.

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Innovate by fostering employee learning

Nadella fostered innovation by encouraging people to adopt a new approach to product development. "We had to introduce and to promote new products and business models ([software as a service] vs. perpetual [licenses]). We had to drive our employees to interact with new corporate decision-makers - business vs. the original technical ones. We had to scale our employees to master new advanced products," Tenzer told me.

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Hold people accountable for results

When you change your company's culture and approach to innovation, your top executives will complain because you are forcing them to adjust how they think and act.

Nadella issues an ultimatum to his 150 top executives: "Once you become a vice president, a partner in this endeavour, the whining is over. You can't say the coffee around here is bad, or there aren't enough good people, or I didn't get the bonus. To be a leader in this company, your job is to find the rose petals in a pile of shit. You are the champions of overcoming constraints."

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