In Conversation With Satya Nadella

When young Satya Nadella was being considered for his first role in Microsoft in 1992, his hiring manager Richard Tait gave him a problem to solve. "Imagine you see a baby lying in the street. The baby is crying. What do you do?""You call 911," Nadella responded.

 "You need some empathy, man. Just pick up the baby," Tait gently put his arm around Nadella and said. Little did young Satya know he was to learn empathy in "a deeply personal way". His only son Zain, now 21, was born with severe cerebral palsy and one of his two daughters also has special needs.

This incident has remained with him to this day, defined him in many ways and features in the opening chapter of his new book, Hit Refresh. Of course, Nadella got the job, being "incredibly smart" and the rest is history. Today, empathy is shaping the culture within Microsoft and ushering in a revival of the global tech giant with a current market value of $593.15 billion. Nadella took over as CEO in February 2014 at a critical time in Microsoft's 39-year-old history. Bill Gates and Paul Allen's company drove the PC revolution, but after years of success, it had fallen into decline. The world had changed -- smartphones had arrived along with new operating systems and other tech majors -- Google, Facebook, Amazon and Apple -- had overtaken Microsoft. Nadella inherited a great legacy that was also beset with bureaucracy, internal politics and low employee morale.

Stepping in, Nadella made renewing Microsoft's culture his top priority. The company had always prized innovation. A consummate insider, Nadella set out on a quest for resurgence: To "re-energize, renew, reframe and rethink" the purpose of the company -- along with each individual within -- while retaining its soul. As Bill Gates explains in his foreword to the book, "... when you hit refresh on your browser, some of what's on the page stays the same". But as the CEO of a company of over 1,24,000 employees across 190 locations, Nadella, says Gates, has "led the adoption of a bold new mission."

The results were striking: The company has generated $290 billion in market value since he took over, doubling its share prices, with profits crossing $21 billion this year. It is back on the forefront of innovation, shaping the future around artificial intelligence (AI), mixed reality and quantum computing. What's more, it is seen as a cool place to work -- no longer an old company, set in its ways. The energy and excitement within seem unmistakable.

Meeting Satya Nadella at his corner office in the 500-acre campus in Redmond, Washington, we are immediately struck by his serenity and absolute lack of flamboyance, a hallmark of his predecessor Steve Ballmer. Wearing a black T-shirt, jeans and sports shoes, he looks lean and fit (he is a runner). Contemplative and almost monk-like in his focus and mindfulness, he has harnessed his entire being towards Microsoft's transformation. His ambition is big and bold, evident in Microsoft's new mission: "To empower every person and every organization on the planet to achieve more."

Within Microsoft, Nadella was seen as a leader who could span technologies and businesses, was a top performer and their "secret weapon", but for outsiders he was an unlikely choice in a blatantly combative company culture. How did a scrawny, soft-spoken, slightly awkward lad from Hyderabad get here? What exactly makes him stand out? When Nadella started out, he seemed quite unremarkable, without a specific plan, much like the average young techie looking for a decent life in the United States. What enabled his evolution? What did it take to connect with so many employees across the world and inspire a transformation? 

Solid Foundation

Satya had a happy, protected childhood in a middle-class Andhra family, raised on a bedrock of ethics and values. He grew up admiring his father Bukkapuram Nadella Yugandhar, an idealistic, left-leaning IAS officer, and anchored by his mother, Prabhavati, a Sanskrit scholar who gave up teaching after she tragically lost her baby girl. While his father, who now leads a retired life in Hyderabad, taught him the importance of ambition in the most altruistic sense; his mother, who is no more, helped him find a sense of contentment and meaning in all he did. She also kept him grounded, created a deep emotional well within, which he was later able to draw upon. "She always believed in doing your own thing, and at your own pace … So long as you enjoy it, do it mindfully and well, and have an honest purpose behind it, life won't fail you. That has stood me in good stead all my life," writes Satya. It is widely believed Nadella has an intuitive feel for working with governments, thanks to his father.

He fell in love with Anupama, an architect who he knew all his life, and married her. She anchored him further and helped him grow. Today he has immense gratitude for Anu for taking on the responsibility of their special needs kids, opting to give up her bright career and paving the way for his success.

As an obsessed cricket fan since his boyhood, he drew several lessons around teamwork and to "compete vigorously and with passion". Cricket was his first love, but computers became a close second after his father got him a PC in high school. Yugandhar also nudged him to get out of Hyderabad and not be "provincial" with his ambitions. 

A Learning Mindset

Thanks to his father's postings, Satya attended different schools across India -- which helped him adjust to new situations -- but by 15 he had settled into Hyderabad Public School, a multicultural institution. In high school, he wanted to play cricket for Hyderabad and be a banker. But by the time he passed out, he was thinking software and engineering, thanks to his PC. However, he did not make it to Indian Institute of Technology (IIT), "the holy grail of all things academic for middle-class kids growing up in India at that time", according to Nadella.

Enrolling for electrical engineering at Manipal Institute of Technology put him on a pathway that would ultimately lead to Redmond. Like his peers, he applied for a master's abroad and got accepted at University of Wisconsin-Milwaukee. "If someone had asked me to point Milwaukee on a map I could not have done it," he jokes.

On his 21st birthday in 1988 he flew from Delhi to Chicago, landing in an alien land, starting life as a young immigrant, getting used to the bitter cold and fighting homesickness. After his master's, his first job was with Sun Microsystems, but the big break came with Microsoft, which he took up along with a part-time MBA course at the University of Chicago.

The stereotype of a studious south Indian boy with an engineering degree immigrating to the US and making it in tech is too obvious to ignore. "But it wasn't that simple … I wasn't academically that great … Only in America would someone like me get the chance to prove himself rather than be typecast based on the school I attended," he writes.

Nadella was determined to grab every opportunity (see interview, below) that came his way and run with it. Finding his mojo in computing, he developed an appetite for hard work. He also read voraciously, and loves poetry, especially Rilke.

But he was not bookish, and never gave up an opportunity to learn from people, almost anyone who he thought could contribute to his growth. Driven and ambitious friends and colleagues like Sanjay Parthasarathy taught him that he "must work hard -- not to climb the ladder, but to do important work", and Dr Qi Lu, whose hiring would stall his promotion, shaped him further. He found mentors like Doug Burgum, who inspired him to think about work not in isolation but as "a core part of one's life". Of course, there was Ballmer who urged him to "throw dogma out the window" and "be bold, be right".

Nadella also learnt from every project he worked on. Bing turned out to be a powerful training ground for the cloud-first services that pervade Microsoft today. After taking over as CEO, he asked a ton of questions and listened intently, learning from juniors, competitors and customers. He even reached out and collaborated with "frenemies" -- Facebook, Amazon and Apple -- and steered Microsoft away from being "a know-it-all" organization, to a learning organization. 

Right Place, Right Time

Perhaps it was also synchronicity that pushed him on a trajectory of growth. Nadella admits to benefitting from the convergence of several tectonic movements: India's independence, the American civil rights movement, which changed immigration policy in the US, and the global tech boom.

He started his tech career at an enormously exciting time: Windows 3.1 had been released, the first website and CD-ROM was launched, and the internet was within touching distance. It was also fortuitous that he joined the Windows NT team -- as new technologies (NT) became the backbone of future Windows versions -- and Bing, which is a big area of focus today. 

Personal Challenges

His wife Anu has been both the love of his life and a comrade in the trenches. When his son Zain's condition was revealed, Nadella was shattered. Anu made him see that it was about Zain and not them. As a father he was called upon to dip into his emotional reserves and understand the pain of his children. "I discovered that recognition of these universal predicaments leads to universal empathy."

Anu also gave him Mindset: The New Psychology of Success by Dr Carol Dweck, a book about "overcoming failures, by believing you can". One message in the book made a strong impression on Nadella: "The hand you are dealt with is just the starting point. Passion, toil and training can help you to soar."

The permanence of Zain's condition pained Nadella in the early years of his son's life, but through the teachings of the Buddha, he learnt to understand impermanence deeply, achieved equanimity and developed a "deeper sense of empathy and compassion" for everything around him.

A World of Empathy

Even as a busy CEO, Nadella is always searching to understand people's thoughts, feelings and ideas. Being an empathetic father, he says, makes him a better leader. The medical technology around Zain's room was "a reminder that our work in Microsoft transcended business, that it made life itself possible for a fragile young boy", he says.

At a company hackathon, empathy, coupled with new ideas, helped create technology that assists people with ALS and cerebral palsy to have greater independence. At home Zain, the music fan, has a Windows app that allows him to control his music. With Nadella at Microsoft's helm, there's been a groundswell of innovations globally where computing can be used in improving lives. He believes empathy will become even more valuable in the world "where the torrent of technology will disrupt status quo like never before". His passion is to put empathy at the centre of everything he pursues -- products and new markets, to employees, customers and partners.

Nadella now travels the world, meeting people where they live, seeing how the technology Microsoft creates affects their daily lives. In the past few years he has visited and supported institutions and projects that rely on "public cloud" technologies on multiple occasions.

In Andhra Pradesh, for instance, schools are using cloud computing for insights to improve dropout rates. A start-up in Kenya has built a solar grid for low-cost lighting and stoves. A university in Greece is working with firefighters to prevent massive wildfires. Researchers in Sweden are helping screen children for dyslexia. Crowdsourced data is helping monitor radiation from the Fukushima nuclear plan in Japan. A public cloud in Nepal used data on schools, hospitals and homes to speed up access to assistance and relief packages during a devastating earthquake.

Eric Horvitz, a member of Microsoft's senior leadership team (SLT), MD and head of Microsoft Research, admires Nadella's intuitive style in running the company and says it is special to work with someone whose approach is "humanistic, compassionate, empathetic and insightful". Another SLT member, Kathleen Hogan, chief people officer, sees him as a leader with "real humility".Nadella offered a clear, tangible, inspiring vision shining a light on ethical technology to make sure machine learning and AI can be harnessed for the good of humanity and supporting data privacy protection to put the user back in control. 

Seeing The Big Picture

Nadella's key ability is to connect the dots and see the big picture -- as well as the future -- while standing up for timeless values. From the start, he has "wanted to work on a software that would change the world".

Coupled with that came the courage to believe and invest in big innovations. It was clear to him that "the world had changed, and it was time for us to change our view of the world". Like most corporations, engaged in the technology race, he is betting on a "mobile-first, cloud-first" future, giving a big push to AI and the astonishing augmented-reality tool HoloLens. Add to that quick, smart acquisitions like LinkedIn and Minecraft. Clearly, he is able to look at a bunch of things and pick out two or three that will move the needle.

Padmasree Warrior, board member, Microsoft, remembers a video conference call between the two teams when she was CTO at Cisco Systems and Nadella headed Microsoft's cloud and enterprise business. There was a tense moment during the meeting that could have harmed the partnership, but she describes how Nadella intervened, urged everyone to look at the big picture, to save the day. "In the middle of the conflict he has the ability to step back and has a calming down effect," says Warrior.

As CEO, Nadella started out asking big, existential questions -- Why were we here? What do we do next? -- redefining mission, outlining ambitions. His message to his SLT was that Microsoft should not just chase competitors' tail lights, but chart its own course. He believed in leadership "with a sense of purpose and pride", not envy or combativeness. 

Team First

Meeting Nadella you can see that inside him there is a sportsman with a winning attitude, tempered by a healthy dose of aggression. Like a good cricket captain, Nadella has believed in leading from the front, putting the team ahead of himself and drawing the best out of people. No one leader, no one group and no one CEO could be the hero of Microsoft's renewal -- "it would be all of us and all parts of each of us".

He started out by going after the best talent and building a strong SLT -- he sees them as a league of superheroes with unique superpowers -- and building consensus that it was time to rediscover their soul. He encouraged them to delve into what made them tick and connect their personal philosophies to their jobs as leaders. The SLT then launched on a mission to motivate their teams. Realizing the importance of building a shared context, trust and credibility, Nadella worked closely with everyone, inviting diverse perspectives, engaging in dialogue within (and with customers and partners). Culture change was not a top-down affair, but initiated through conversations with people down the line, leveraging technology.

Then in July 2015 during a company annual summit at Orlando, Florida, where some 15,000 Microsoft employees gathered, Nadella addressed them. He spoke from the heart, touching upon the themes of rediscovering the soul of Microsoft, redefining the mission and surging ahead with a growth mindset. "We will grow as a company if everyone, individually, grows in their roles and in their lives. I had essentially asked employees to identify their innermost passions and to connect them in some way to our new mission and culture. In so doing we would transform our company and change the world." Overcome by emotion, Nadella stepped out before his time was up. As a video started presenting the year's progress and the opportunities ahead, Nadella slipped back into the auditorium through a side entrance. "Every eye was glued to the screen, but I was watching them, gauging the emotion in the room. Everyone was locked in and some were softly wiping away tears. I knew then that we were on to something." 

The Trusted Guy

To rise through the ranks and become the CEO of a large corporation, you've got to be tough and politically astute. The journey to the top would have involved managing the environment, dealing with warring factions, taking cold, ruthless decisions, balancing business imperatives with personal values and priorities. Meeting Nadella, you want to believe he is not the smooth, cynical company guy, who will do anything to get ahead, but a man you can trust. He makes an impression immediately.

A high emotional intelligence helps him deal with problems and people and to connect with them easily. He comes across as a well-meaning guy -- speaking directly and simply. He is aggressive in business, but not brash in person. Certainly not the PowerPoint guy you would expect, he is spontaneous, authentic and relatable. His ability to say sorry (he once blundered on stage when asked a question about gender pay gap) perhaps also makes him immensely likeable.

He is fiercely protective about his family, and his loyalty to them, as a father, husband and son, shines through in every interaction. When Anu wanted to move to the US after their marriage, her visa application was rejected as she was married to a permanent resident. Nadella went back to a H1B visa, so she would be allowed to join him, and became famous on the Microsoft campus as "the guy who gave up his green card". That's Nadella, a man who will go all the way for what is important. 

Engine of Transformation

Nadella's father taught him the value of building lasting institutions that "comes from having a clear vision and culture that works to motivate progress both top-down and bottom-up". Nadella has shown the way for insiders to obsess about customers, actively seek diversity and inclusion and act as "one company", stepping out of silos. Everyone today supports the mantra of business for social transformation and impact. And he has made sure that the message goes out that it is: "Not Satya's thing, but Microsoft's thing."

When asked about how well it's going, his response is Eastern: "We are making great progress, but we should never be done. It's not a programme with a start and end date. It's a way of being." Also he does not claim that the journey is over, the transformation is complete or any successes have been achieved.

There was a time when Indian engineers at Microsoft were aware that despite their contributions, they could get only up to a certain level but not beyond. Someone once told a colleague of his that it was because of their accents -- "an idea as derogatory as it is outdated", says Nadella. Today diversity -- of race, gender, colour -- is a big pillar in the new culture.

While you can see Nadella's imprint on the new Microsoft, how has all of this changed him? Says Warrior: "When you are leading a complex global business power can go to your head. But he has remained down to earth, and is totally grounded. And I don't see power going to his head ever. He is that kind of a person, which is very special."

In the end, the possibility that an ordinary guy like Satya can rise through the ranks and stand among the top leaders in tech has perhaps inspired thousands to step up and be part of his dream.

"LIVE MINDFULLY IN THE MOMENT"

The India Today Group -- Group editorial director, Raj Chengappa, Prosenjit Datta, editor, Business Today, Bandeep Singh, group photo editor and Sanghamitra Chakraborty, editor, Reader's Digest met Satya Nadella at his office in Building 34, Redmond, Washington. Bathed in sunlight, it is stacked with books and has a standing desk in one corner. This is Nadella's temple of worship. Excerpts from the conversation with RD:

RD: When you started out did you think you'd really be part of a bunch of people who would change the world?

Satya Nadella: What I think was ingrained into me was a sense of curiosity. That ability to look at opportunities given, and to assume that's amazing. I never remember a job at Microsoft I had and feel, "Oh, god, this job is less important than the one I had." I always felt that this is the greatest job, it's the greatest opportunity, I'm so thrilled to have it. It's some combination of my father, my mother and their influence on me. There was never this thing about, "Oh, look for something next." As opposed to, "Take what you've got and really, really exploit it to its fullest, to have the deepest impact." That, perhaps more than anything else, has defined who I am.

And if you were to speak to your younger self with what you know today, what would you say?

I would reinforce that, now that I have a better understanding of it. Because so much of life is lived in anticipation of something. It's a cliché, but it's the most powerful one, which is that you've got to be able to mindfully live in the moment because that's all you've got. That, I think, is what has made the most difference for me.

Is it possible for individuals and organizations to learn empathy?

I fundamentally believe so. Empathy for me is not abstract. It is a concrete and important need for us at a human level: one of the things that's helped me grow as a human being. Would I have had as much empathy for people with disabilities if it were not for what happened to me with my children? No. But now that I have had that experience, and with the job I have at Microsoft, it is amazing to see new innovation in AI where you can literally take eye gaze and turn it into input. So, somebody who has ALS and is quadriplegic, with no movement other than just their eyes, can now type. And so I feel like, wow, I've gotten all of it. Everything, my meaning in my job, what Microsoft as a platform has allowed me to do, how it's connected to my own life's experience and so on. That is, I think, a bit of a summary of at least what gives me energy.

Like banks protect our money, companies like yours with cloud-based solutions protect our data, our identity and much more. So how daunting is this responsibility?

Privacy, security, being compliant with the laws of the land are key for us. When we think about our cloud infrastructure, I think about all of those. So first is to be able to actually have state-of-the-art security. On privacy the key is to be very, very transparent in terms of what is the data, what is it being collected for, what is it being used for. This is to completely put the user back in control, whether it's an organizational user or an end user. The European regulation around GDPR (general data protection regulation) is clearly going to define the world's standard on what that means for every individual user. So that's another huge element of what we invest in and what we are working towards. The third aspect is our India data centres, created with huge investments. And it is so that Indian data can remain within India's digital sovereignty, so that the public sector can trust it, and then have compliance to any regulatory audits and so on, that the government of India or other agencies want to run.

What is tougher, staying principled or making an exception?

In a slightly immature state of global legislation, and a global equilibrium around privacy and security, it's super important for tech companies like ours to be very principled, recognizing ultimately that we operate within the context of the various countries and their frame-works of law. I feel what is most important is for the world not to be dependent on the morals of any single CEO, or any set of principles of any single company. But we must recognize the urgent need for the world to achieve equilibrium on the most important issues of our times  -- the balance between privacy and security, to cite an example. It's not just important in India, it is for all countries, and they have to come together and say that we have a joint understanding, like we have with human rights, or climate change, or many other issues. We've got to achieve a global consensus on this. And if we don't, we are going to pay for it.

How does your Marxist father look at your job today and the phenomenal salary that everybody talks about?

He's not only a Marxist economist, but he's actually a big critic of Marx. There was one problem with Marx. He was very deterministic, right? He sort of thought that he can do what Einstein did for physics with history. And that is one of the greatest lessons learnt. You've got to create these systems -- it's not just the self-interest of individuals, but it's the ability to turn that self-interest into more social good for the entire society and create a virtuous cycle. Most people say, "Business is all about exploitation." It's not. If anything, liberal democracies and capitalism can only survive if they create increasing surplus for more people. And so, I, in some neo-Marxist way, think about a way for our capitalism to thrive or our liberal democracies to thrive going forward. That's sort of how I reconcile whatever was the influence that he had on me, at least in today's context. The equation between technology, productivity and growth leads to economic growth that leads to more wage growth and jobs.

Who are your heroes?

I have been blessed with people in my own life, and in the 25 years in Microsoft, with people who have had a profound impact, whether it's Bill, Steve, Doug Burgum or Jeff Raikes and so many others who I've had a chance to work with, who have not just helped me bring out my best at work, but more as a human being. To draw out all of me to be able to have the impact that every one of us aspires to. I'm a big, big fan of Nelson Mandela -- among the global leaders who have had a great impact. He has been able to show us what great leadership is all about. The ability to have the kind of impact that he had in South Africa, but create a blueprint, a template, for every one of us in any sphere of life, in any part of the world is most inspirational.  

Tell us about three tasks you ask Cortana to help you with.

I ask Cortana [Microsoft's smart digital personal assistant] to wake me up, I ask what my day looks like and there is a super feature in it called Commitments. If I make a commitment, it is smart enough to come back and tell me, "Make sure you follow through!"

*US$1 was Rs 65.06 at the time of going to press.