Photo by David Ryder/Bloomberg

Photo by David Ryder/Bloomberg

A recent Bloomberg profile of Microsoft CFO Amy Hood (MBA 1999) offers an inside look at how the 16-year company veteran has worked to redefine the tech giant.

Hood’s tenure as CFO began with an immediate challenge, as detailed in the Bloomberg piece:

Once Nadella took over as CEO in February 2014, Hood needed to correct missteps made on Ballmer’s watch. First up: the $9.5 billion Nokia deal. Less than a year after closing, it was foundering and had missed Hood’s initial forecast for sales and savings. “Once the forecast failed to pan out, Amy was extremely rigorous on first calling attention to the failing performance and then encouraging everyone to focus on making hard decisions quickly," says Microsoft President and Chief Legal Officer Brad Smith, whose office shares a small hallway with Hood’s.

So what was the plan to return Microsoft to relevancy—and mend it’s rocky relationship with investors?

After Ballmer left, the relationship with Wall Street needed tending to. The shares had given up a third of their value during his tenure, even though sales almost quadrupled. Fritz Foley, who attended Harvard Business School with Hood and went on to become a professor there, recalls her frustration during an interview for a case study. “We had consistent performance, but generated no confidence,” Hood told him. “People did not believe we were relevant.” Foley says some value investors even wanted Microsoft to quit pushing into new businesses and simply milk Windows and Office.

At an executive retreat in 2015, Hood lectured senior leaders on the need for more internal and external metrics to keep employees on a measurable path and communicate better to investors. Nadella and Hood hatched a plan to refocus investors on the smaller but growing cloud business, pledging in April of that year to reach $20 billion in annualized revenue from the commercial cloud business by fiscal 2018, a goal they passed in the first quarter. It was a “look over here” move that took investors’ eyes off the waning PC business.

The piece goes on to discuss Hood’s management style, which is described as giving her team “room to run,” and offering the following anecdote:

Bridgette Link runs Modern Finance and has broad discretion to determine what kinds of tools will make the most positive impact on her staff. Link says her boss had one request: “flawless execution.” When Link was asked to take an ax to corporate policies governing things like travel and purchasing, Brad Smith suggested she trim about 20 percent of the 1,800 policies. Hood told Smith he was letting the team off easy. She asked for 50 percent. Link delivered a 92 percent cut.

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