Introduction
This book is written by Satya Nadella, President and CEO of Microsoft. He took over as Microsoft’s 3rd President/CEO in 2014, succeeding Steve Ballmer and Bill Gates. Microsoft’s stock price has more than doubled since he took over, and he is generally considered to be a highly successful CEO.
Hit Refresh focuses partly on Nadella’s previous history, partly on his views regarding leadership and partly on his more general outlook and more philosophical views. He comes across as an impressive original thinker, as much as a successful doer. This is indeed an impressive combination!
Nadella had previously been heading up several smaller divisions at Microsoft, including Cloud Computing before he became CEO. Microsoft seems to have put relatively too heavy emphasis on its Windows technology, and had experienced a decline during the last two years of Ballmer’s reign. What had traditionally been the company’s key strength seems to have been held onto too long! Cloud computing in contrast to Windows, called for new capabilities. But Microsoft seemed to have been too complacent, and was thus not allowing for technology shifts in time. It seemed to have a rather self-centered culture, by always knowing best and not cooperating with others.
Actions
When Nadella took over as CEO, he asked all of Microsoft’s 120 T employees what would happen if Microsoft would disappear. Microsoft was very unpopular with many consumers at the time, and out of this came the realization that the company would have to move from making products that people need, to making products that customers want! Customers should be convinced that they truly would appreciate Microsoft products! People should in essence now be empowered to create their own Microsoft products!
As one step in this direction, Microsoft bought LinkedIn for ca. 26 B USD in 2016. Nadella felt that this would allow Microsoft to bring its content technology into LinkedIn’s network, and thus create a better way to serve B2B customers, above all. Ballmer had bought Nokia’s mobile phone division in 2012 for ca. 13 B USD. This was written off. There was no obvious fit with Microsoft’s technology here. In contrast, by 2016, Microsoft’s culture had become more open, thus “allowing” for the LinkedIn acquisition.
Leadership
Parts of the book, Hit Refresh, deals with Nadella’s personal history. We shall not review all of this here, except to note that Nadella’s strong focus on empathy with others may have its roots in his upbringing – Indian culture; Sanskrit; and even Karl Marx..!
Instead, let us focus on what Nadella seems to consider key aspects of good leadership. Let us summarize in key words:
Energy and enthusiasm
Have a supportive style
Being able to have multiple perspectives (i.e. eclecticism) is key
Listen a lot
The culture: should be more open, partnership focused
In a Microsoft/tech-perspective: Success is to combine cloud/quantum computing, mixed realities and Artificial Intelligence (AI)
The bulk of the Hit Refresh thus deals with Nadella’s leadership principles and how these are applied at Microsoft (five out of nine chapters; chapter one deals primarily with his personal history; chapter seven to nine to focus more on Nadella’s philosophy).
In chapter two, he discusses how he learned to lead, above all by seeing the emerging Cloud technology relative to the more established Windows technology. It took leadership to evolve from the latter to the former. A key learning here is to expand fast within the new business area, by adding resources and capacity, and not allowing for slowdowns due to potential over-focus on problems.
The book then evolves into articulating a new mission for Microsoft, with a focus on momentum! And, Nadella stresses that speed, in fact, harks back to the original soul of Microsoft! Nadella had a “full speed ahead” focus from the start of him becoming CEO – driving the new momentum! These areas of focus seemed particularly key:
Reinvent productivity and business processes
Build the intelligent Cloud system
Move Windows users to become creators of own personal computing
This focus was indeed a cultural renaissance: the emerging culture would focus on learning, as opposed to the old “knowing”. Several key points here would be:
Listening
Letting others speak
One company (unity of purpose), but eclectic, with no “silos”
A natural next step in such business transformation is to focus on building partnerships, perhaps even before one might fully need them. Interestingly, there had been a close cooperation between Microsoft and LinkedIn even before the take-over, discussed above. Thus, in advance, a key condition for successful integration had been set.
The Cloud
Chapter six then discusses the Cloud, and how one might evolve here, a favorite topic of Nadella’s. He discusses three major shifts, each likely to impact the evolution of Cloud:
Mixed reality: not only the more obvious virtual reality, but, in addition, various classes of mixed physical and digital “realities”. (Nadella used Microsoft’s HoloLens to be “transported” to the surface of Mars, and he was able to walk on the surface, and to inspect rocks on Mars’ surface. This was based on a feed from NASA’s Mars rover, Curiosity).
AI, or machine´s ability to “learn to learn” will influence the Cloud, and be enabled by the Cloud
Quantum computing. This topic is often overlooked, but recent advances in theoretical physics and materials science will profoundly influence electrical engineering, app-developments and the Cloud
Philosophy
We have perhaps already started on Nadella’s more philosophical journey in this book review. And, both personal and general philosophy are the topics for the final three chapters of the book.
In chapter seven he discusses how we normal citizens might develop trust in this emerging technology. He stresses that key timeless values in the digital age remain focus on privacy, security and free speech – this is particularly relevant today given Facebook´s breach of trust over the Cambridge Analytica scandal. Strong trust, over time, he argues, is perhaps a function of empathy, shared values and a sense of safety/reliability.
In the next chapter (chapter eight) Nadella discusses the future of humans and machines, a very philosophical exposé. Perhaps the most pressing issue discussed is a framework for ethical AI design, based on four issues: empathy (again – this is a recurring theme), education, creativity and judgement/accountability. In this reviewer’s view, there is still a long way to go before we might reach some sort of agreement regarding how to handle this key dilemma, however.
The final chapter, also highly philosophical, discusses how to re-start economic growth in the world. He stresses the key role/responsibility for corporations when it comes to this. In his typical style as an engineer, Nadella offers a formula for economic growth, the sum of education and innovation, multiplied with the intensity of technological use. He is dealing with a difficult cutting-edge dilemma here that, no doubt, might not have a clear answer. It is important, however, that Nadella stresses the key importance of the “tech” side – through innovations, through education and through intensity of technological adaptation.
The book ends with an afterword, which is also very philosophical, even speculative. I shall not review this here.
In conclusion, Hit Refresh is a very important book, with powerful insights regarding what would constitute effective management practices, including:
Strong focus on empathy. It is people who make value, and they must be supported! Eclecticism is key.
Innovations are key! Technology is a vital driver.
The culture must encompass growth and renewal, through open-ness, listening and learning.
Nadella has demonstrated the power of his philosophy. And as he stresses, this requires a long-term commitment, but with action now!
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