Posted by Tom Foremski - April 25, 2006
Scott McNealy's departure from Sun Microsystems has been on the cards for more than a year. It will likely be just one of many departures by veteran Silicon Valley and other captains of the tech industry over the next year or two, as that generation moves into the grey zone of life.
Mr McNealy has a superb track record, and his executive team over the years has gone on to lead many other companies. But it is hard to preside over a company that is not growing as Sun used to grow: explosively.
I remember chatting with Ed Zander, about a year after he left Sun and he spoke about how tough it was to downsize a workforce, and the many difficult decisions that Sun would have to make to survive the longest downturn in Silicon Valley's history. When you've spent most of your time hiring like mad, and focused on staff loyalty, downsizing is an anathema.
Managing a company that is growing very quickly is a very different challenge from managing a company in today's very tough markets. It is a very different culture and it requires a cultural change that not every company can manage well.
Sun has a huge market and has large opportunities, it won't go away anytime soon, but it does need a boost in the arm. I've often said that a Sun and Hewlett-Packard merger looks good to me, with some very good synergies. And it would be an interesting play against IBM, a West Coast v East Coast rivalry that could play well.
Is Mr McNealy's departure and the subsequent head count reduction, estimated at 5,000 by financial analysts, a way to dress up Sun for an acquisition or merger?
And who else will depart for the green pastures of the golf course? Steve Ballmer over at MSFT has been a bit quiet, Ray Ozzie is on the ascendent, there might need to be some room made at the top...
Who will be next to go is less interesting than who will be in the ranks of the new leaders of Silicon Valley and the tech industry. To be honest, I don't see much of a leadership emerging yet; maybe it is under the radar, maybe the new leadership will be apparent when the new upstart companies emerge?
But will we have new upstart companies that can survive beyond five years before they are acquired? Is the game these days a case of scale? In which case, the giant sucking sound of GOOG, YHOO, ORCL, SAP, INTC, EBAY, etc will dominate the technology/media world. And thousands of startups will compete to get sucked into those gargantuan organisations and we won't get the same crop of dynamic and colorful business leaders that used to characterize Silicon Valley.
That is one, very obvious scenario. However, the expected scenarios often don't come through quite as expected so I'm looking forward to picking out the new leaders. Let me know if you have any suggestions on who might be in the ranks of the new Silicon Valley/tech leadership.Tweet this story Follow @tomforemski