Microsoft Corporation Makes Room for Elop

As Meg Whitman at Hewlett-Packard and, more recently, John Chen at BlackBerry remind us, corporate turnaround artists are a rare but highly valuable breed. Although perhaps overshadowed of late by either executive, incoming Microsoft (NASDAQ: MSFT  ) executive Stephen Elop himself deserves plenty of credit for pulling Finnish smartphone firm Nokia out of a vicious tailspin that threatened to take Nokia down eventually. And as Microsoft prepares to close its $7.2 billion buyout of Nokia's handset division, new Microsoft CEO Satya Nadella recently reshuffled his management ranks to prepare to welcome Elop back under Microsoft's corporate umbrella.

However, this move isn't without its risks for Microsoft and its investors.

The good and bad of Elop's return
Before Nadella's tenure began atop Microsoft, longtime CEO Steve Ballmer reshuffled Microsoft's corporate structure. And in keeping with this new structure, Nadella recently made room for Elop to run Microsoft's Devices and Studios segment. Appointing Elop to this position is something of a no-brainer, as the division will house Microsoft's hardware businesses, including Nokia's incoming handset division.

However, the role will also put Elop in charge of reviving two of Microsoft's more challenged products of late -- its Surface line of tablets and its Xbox division. Thus far in its several years of existence, the Surface has yet to become more than a niche player in the tablet market, despite plenty of support on Microsoft's part. Similarly, Microsoft launched its Xbox One in time for the holiday season, but it has steadily lost ground to Sony's PlayStation 4 in the past several months. And it's Elop who will need to right the ship for both of these headache-inducing products as he returns to Microsoft in the coming months.

In the following video, tech and telecom analyst Andrew Tonner looks at Microsoft's recent management moves and why they matter for investors.

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Read/Post Comments (5) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 01, 2014, at 7:03 PM, jscilla wrote:

    The Surface came out about 1 yr. 5 mths. ago not several years.

  • Report this Comment On March 01, 2014, at 8:40 PM, symbolset wrote:

    If Elop was a success at Nokia, what might a failure look like?

  • Report this Comment On March 01, 2014, at 10:09 PM, stockanal45 wrote:

    "The Surface came out about 1 yr. 5 mths. ago not several years."

    What do you expect? Just a typical Motley Fool article with false information.

  • Report this Comment On March 13, 2014, at 3:25 PM, themover wrote:

    The only reason they bought them is the media and investment groups were crying and crying how they are not following the trend to movies on 1x1 inch screen. Its so cool to watch movies on a screen you cant see.

    NO mention the fact that cell phone use damages eyes in children/teens making them BLIND!

    Good job to all those people who work on devices that made people partially blind.

    Your support of the common man should win them a noble prize.

    Microsoft destroyed America while remaining profitable and made dirty money good. People who worship false idols is the biggest sin of all. Move Redmond to INDIA! PLEASE!


  • Report this Comment On March 20, 2014, at 12:50 PM, jackfleming wrote:

    Gives the company a new direction and makes it a more accessible for all users

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Andrew Tonner

Andrew Tonner is a tech specialist for The Motley Fool. He is a graduate of The University of Arizona with a degree in Finance.

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