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Microsoft’s Chris Liddell hands CFO post to upstart Peter Klein

Chris Liddell

Peter Klein was previously corporate vice president and CFO
of Microsoft’s business division overseeing the financial performance of major
products, including the Microsoft Office System and its Business Solutions
suite, and was responsible for all of the division’s strategic planning,
financial reporting and analysis and communicating with its investors.

Before that he spent four years as CFO for the company’s server and tools
business – all of which make him a sensible and not surprising choice for the
group role.

He now takes responsibility for the company’s global finance function,
overseeing any acquisitions, corporate strategy, treasury, tax planning,
accounting and reporting, internal audit and investor relations at the $18.9bn
business.

He’ll need to continue Liddell’s work to bring costs in – the company says it
reduced those by $3bn in the past fiscal year – but Klein says he is confident
about taking on the job amid the worst economic crisis in memory. “We have an
incredible pipeline of products, strong financial and operational capability,
and we are well-positioned for growth as the economy recovers,” he said.

Microsoft ensured a smooth handover announcing Liddell’s departure and
Klein’s succession at the same time, while Liddell stayed on until 31 December
to complete the change.

There was some speculation that Liddell may have been forced out given that
most believed his relations with the board, CEO Steve Ballmer and the business
were good and that he had little reason to move on. That gave way to talk that
New Zealand-born Liddell had left to pursue a non-financial role, such as a CEO
seat, or would seek to join a private equity company having ‘done’ listed
business. Liddell himself isn’t saying either way, but the odds are good that he
will resurface in a prominent, strategic role which may go beyond finance and
even beyond technology.

The Associated Press reported that Katherine Egbert, an analyst at Jefferies
& Co, said she did not believe he “was forced out, nor do [we] think he is
leaving under untoward circumstances”, while it added that Credit Suisse analyst
Philip Winslow was “encouraged by Microsoft’s selection” of Klein to replace
Liddell and believed that his track record “suggests he will continue the focus
on cost efficiency championed by Liddell.”

Klein, 47 to Liddell’s 51, is a relative unknown. His promotion represents a
serious opportunity for one of Liddell’s understudies to make his mark on the
business at a time of great economic change. He added that he had “learned a lot
working with Chris.”

In an exclusive interview with Financial Director in 2007, Liddell
revealed what it was like working with and reporting to CEO Ballmer. “The great
thing about Steve is, externally and internally, he’s exactly the same person,”
Liddell told us. “So what you see on the outside is also what you see on the
inside.”

What might it be like for Klein working under Ballmer? “If you like people
who are energetic and enthusiastic and are always sort of ‘go, go, go’ then
you’ll love working with Steve,” Liddell told us in 2007. “If you find that
tough, then he’s a tough person to work for. He’s very open with his opinions
and he’s just emotionally charged: meetings are very challenging because he gets
to the point very quickly. You don’t go into meetings with Steve
under-prepared.”

And on the financial views from the top brass, he told us, “These are people
who created a $300bn company. They didn’t create it by being financially lax.
These are two guys who are more focused on the bottom line and expense and
spending than any people I’ve ever worked for.”

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