As it named longtime company insider Satya Nadella its new CEO Tuesday, Microsoft made a second, less-noticed appointment that will also be key to its transition from a world dominated by PCs to one ruled by tablets and smartphones.
To replace the legendary Bill Gates as chairman, the company tapped John Thompson, a seasoned valley executive and former CEO of Symantec, who will become only the second chairman in Microsoft's history.
Thompson's new role, analysts and industry experts said, is a signal that the company hopes to help reinvigorate its sluggish business by injecting some of the valley's cutting-edge innovation.
"Thompson is a very well and deeply respected guy and his experience, plus his connections with the tech ecosystem in the valley and elsewhere, will be invaluable for Satya," said John Connors, Microsoft's chief financial officer from 1999 to 2005, who now is a managing partner with Ignition Ventures.
While a CEO generally handles a corporation's daily operation, a chairman, which is generally not a full-time job, has considerable responsibility because the board he or she heads oversees the top executives, including the CEO, and has ultimate responsibility for the company's performance.
Industry experts view the leadership change as a determined effort by the Redmond, Wash., company's board to move more quickly into mobile devices and other growing markets so the company can regain its former stature. Microsoft has been hard hit by the declining personal computer market, which depends largely on its software.
And for Thompson -- a Microsoft board member who ran Mountain View-based security company Symantec for a decade and is now CEO of San Jose-based software company Virtual Instruments -- being handed the chairmanship represents a crowning achievement in his long and lustrous career.
"This is the capstone, the cherry on top," said technology analyst Charles King. "I don't know where you go after this. He's a good man and a very able leader, and he should be exactly what Microsoft needs at this time."
Other analysts said Microsoft's board is eager to borrow ideas from Silicon Valley and that Thompson is the perfect person to help it do that.
"They are going straight to a core Silicon Valley executive to be chairman, and I think part of that speaks to where the technology trend is going in terms of mobile," said FBR Capital Markets analyst Daniel Ives. Noting that Thompson headed Microsoft's search for a new CEO, Ives added that it's likely Thompson will be heavily involved in making sure the company "is ready for this next phase of growth."
Microsoft officials said Thompson was not available for interviews. But in a video on the company's website, he addressed a stockholder concern that Microsoft hasn't been performing up to expectations.
"As part of my new role," he said, "one of my key contributions, I hope, will be to engage with shareholders and keep focused on how together we can bring great innovation to the market and drive strong, long-term shareholder value."
Thompson, one of the few African-American CEOs in technology, was raised in South Florida by working-class parents, a teacher and a postal worker, where he played clarinet and saxophone in school, earning a band scholarship that sent him to college in Missouri. But he wanted to study business, telling interviewers later that he noticed the most successful adults he knew in the African-American community were small-business owners.
After Thompson transferred to Florida A&M, a professor there steered him to IBM where he took a job in 1971. A charismatic salesman, wine connoisseur and lover of designer suits, he spent nearly 28 years working up the ranks at IBM, eventually becoming head of sales and service for the Americas. But he was looking to do more.
After becoming Symantec's CEO in 1999, Thompson methodically expanded its sales channels around the world, with impressive results. During his tenure, which ended in 2009, the company's revenue grew from $632 million to $6.2 billion, and its workforce from about 2,300 employees to more than 17,500.
But not all of his decisions were cheered. He was especially chided by investors for pursuing a $10 billion deal in 2005 to buy the storage-software company Veritas. Although some analysts endorsed the acquisition, Thompson later acknowledged it didn't go entirely well and Symantec later largely wrote off the purchase.
When Thompson retired from Symantec, he joked to a reporter that his only plans involved "a chaise lounge on the beach and a mai tai." But he was back in business a little more than a year later as CEO of Virtual Instruments, a Scotts Valley firm that makes performance-monitoring tools for data storage networks and big computer systems.
Thompson also has been a busy investor in early-stage tech companies, including San Jose-based PernixData, whose software helps store data on computer servers.
PernixData CEO Poojan Kumar said Thompson has given him helpful business advice and should be able to do the same for Microsoft. Besides running a major tech company, Kumar said, Thompson "has also seen the nimble, startup side of things," which should prove invaluable for the software giant because as its executives struggle to reinvent the company, "they need to be nimble."
Born: Fort Dix, N.J.
Education: Bachelor's degree in business, Florida A&M University; master's in management, MIT's Sloan School of Management
Career: Currently CEO of Virtual Instruments. Was CEO of Symantec from 1999 to 2009; previously worked for 28 years at IBM, rising to become general manager of sales and support for the Americas.
Public service: He has served on a number of government boards and commissions, including the Financial Crisis Inquiry Commission, the National Infrastructure Advisory Committee, and the Silicon Valley Blue Ribbon Task Force on Aviation Security and Technology. He also has served on the national board of Teach for America, an organization dedicated to eliminating educational inequities for all children.
Family: Married; two adult children