Microsoft's Satya Nadella takes big leadership swings in race to catch up to AI leaders

Microsoft’s leader Satya Nadella has been busy shifting roles and responsibilities at the tech company this year, bringing in new talent and moving people around as the firm tries to stay on top in the artificial intelligence race.

The head of the 50-year-old company has brought in big names like Jay Parikh, who led the engineering at Meta, and given bigger jobs to people already working there, including Judson Althoff who handles business sales and Ryan Roslansky who is chief executive officer of LinkedIn, the professional networking site Microsoft bought years ago.

The changes come as other tech companies are catching up in AI, and Nadella wants Microsoft to move faster on making its own AI systems, improving tools for programmers, and building better software programs, according to some current and former employees at Microsoft.

“Satya is in ‘founder mode’,” said Dee Templeton, who holds a senior technology role at Microsoft. The phrase comes from Paul Graham, a well-known Silicon Valley investor, and means running a company with a hands-on style like someone who started it from scratch.

Growing competition and shifting partnerships

Sources close to Nadella say he’s watching Amazon and Google more closely now. Both companies were once behind in AI, but have made big strides in building the computer systems and developing the models that power AI tools.

Microsoft jumped ahead in AI with a $14 billion investment in OpenAI, gaining early access to its technology and priority on data center contracts. In October, the partnership changed: Microsoft will lose exclusive rights to OpenAI’s data centers and, by the early 2030s, will no longer have exclusive access to its research and models.

Microsoft’s AI helper called Copilot, which works with Microsoft 365, has passed 150 million users each month, the company told investors in October. But that number falls short compared to Google’s Gemini chatbot, which has about 650 million users, and OpenAI’s ChatGPT, which has 800 million users.

Newer companies like Anthropic, Anysphere, and Replit are luring customers away from Microsoft’s AI coding tools.

Weekly meetings to break down barriers

In response, Nadella has reorganized leadership and started weekly meetings where employees discuss competitive challenges, allowing him to connect with staff beyond his top team and gather fresh ideas.

“Satya is trying to demonstrate a sense of urgency,” one Microsoft worker said. “The goal is to get out of some of the structures that exist and make the route to him easier.”

Templeton, who runs these weekly meetings, said the point is to get different teams working together better so the $3.5 trillion company can move at a faster speed than it normally does, cutting through all the management layers in between.

Nadella has also been spending more time talking to startup companies. He’s met with Applied Compute, a firm making specialized AI “agents” that can do different jobs on their own, started by people who used to work at OpenAI. He’s also talked to Mercor, a hiring platform, to better understand what companies actually want from AI tools.

Outside talent sparks internal jealousy

The leadership shake-up has brought in outsiders, stirring some discontent internally. Parikh, formerly Meta’s engineering lead, now heads Microsoft’s CoreAI unit, overseeing developer tools. This follows last year’s hire of Mustafa Suleyman, a Google DeepMind co-founder, to lead Microsoft AI with his own budget and pay authority to attract top talent.

“Satya is determined to support new recruits against Microsoft’s own culture,” one Microsoft worker said. “There is some jealousy internally. People are making more money in his unit, but that is a risk worth taking.”

Microsoft said in a statement that all senior leaders have the same ability to hire people and run their teams in whatever way works best for their business and workers.

Soma Somasegar, who works at Madrona, a venture capital firm, said Nadella’s changes to top leadership would help reduce “red tape” as Microsoft builds up its own AI plans separate from its OpenAI investment. “He wants to keep experimenting and see what’s going to deliver,” Somasegar said.

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