Steve Ballmer spent more than two decades at Microsoft, leading the company from 2000 to 2014 as its CEO. But some of his most important business-related lessons have come from his role as chairman of the Los Angeles Clippers, the NBA franchise he bought for $2 billion in 2014.
Ballmer was the debut speaker at the GeekWire Summit in Seattle, where he touched on various topics including USAFacts, the nonprofit civic data initiative that he founded in 2015, his ownership of the Clippers, his views on Microsoft, and more. Here’s a rundown of his comments.
Hiring lessons from this summer’s blockbuster trade: The Clippers landed NBA Finals MVP Kawhi Leonard and All-Star Paul George this summer in what Ballmer called “an amazing coup.” He said the “sales process” of convincing Leonard to come to Los Angeles was “much more disciplined and exhaustive than anything I ever did at Microsoft.” The team spent a year trying to understand how to get Leonard and even spent $500,000 on a video as part of the recruiting process.
“I learned a lot about hiring that I had no sense of at Microsoft,” Ballmer said. “I recommend to people — if you set your mind on someone who works some place else, you don’t have to hire them immediately. You can really put energy and effort into that process.”
Leadership lessons from owning the Clippers: “The balance of long-term strategy and product development, and how it fits with short-term accountability,” Ballmer said. “You always have to have a long term plan. I probably got longer presentations about long-term plans from our Clippers staff than I ever did at Microsoft. Maybe too much, but 50-to-60 PowerPoints on what-if scenarios … very detailed, thoughtful planning. More so, in fact, than we do in some businesses.”
But Ballmer said the flip side is that there is much more short-term accountability in sports. If a company misses earnings expectations, it can tell investors they’ll fix the errors and come back next quarter. In sports, “you get a grade every 24 seconds,” and it’s simply about whether you win or lose the game.
“At the end of the game, you won or you lost,” Ballmer explained. “There’s no blah blah blah, we’re going to fix it in the future — no, we lost the freakin’ game! That’s it. Over, end of story.
“So the level of accountability is higher in sports despite the way people think about business. And the ability and need for long-term planning is high and complicated.”
On the NBA’s recent dilemma with China: “It’s a reminder, more than the specifics around the China issue, that there are government, regulatory, and policy issues around which people need to be very sensitive and try to handle them in a very careful, important way. Particularly sometimes as we’ve seen here in the U.S., there’s a balance between the interest of companies and their employees here in the U.S. versus China. More thought, more care, more attention needs to be put in. Sometimes you’ll make a trade-off as a company that causes you to either do things in China that make problems in the U.S., or vice versa.”
Ballmer said he doesn’t know where the issue will end up. But he said, unrelated to the China dilemma, the NBA encourages players to speak out on social issues.
On Microsoft’s new Surface device lineup: Ballmer was pumped about Microsoft’s latest Surface hardware reveal event.
Ballmer has just jumped out of his seat and squealed that the “new Surface line up is amazing! Go, Microsoft Go!”
— Dina Bass (@dinabass) October 8, 2019
Ballmer said Microsoft is on an “extremely good path as a company” and doing “an amazing job of execution,” pointing to its cloud business in particular. He said there is much profit to be made with its hardware business. And Ballmer said the “most exciting thing, in a certain sense, is the strength of the Windows business.”
“I read all kinds of rhetoric about Windows not being important to Microsoft — Windows makes billions and billions and billions per year,” he said. “This investor wants to see that profit stream stay around for a very, very long time. There aren’t a lot of new profit streams you can invent that generate the kind of profit that Windows does.”
Microsoft stock is up nearly 25 percent this year and the company has a market value of more than $1 trillion.
Ballmer is the 17th-richest person in the world, with a net worth of $51 billion, according to Bloomberg.
On what he learned from Bill Gates: Ballmer met the Microsoft co-founder when the pair were in college at Harvard. They’ve known each other for more than four decades, a large part of that time together as executives at Microsoft. Ballmer said Gates is both the smartest and most competitive person he’s met. “I primarily learned … just how competitive one can really be,” Ballmer said. “The learning I got from Bill is really about competition — understanding competition, working on competition, what does it take to succeed [in terms of] competition.”