Microsoft names new leadership for small-business software group

Satya Nadella will succeed Doug Burgum as head of Microsoft Business Solutions, the company said Tuesday. Burgum will leave Microsoft in June 2007, the end of the company's fiscal year.

Nadella, a corporate vice president, immediately takes charge of the group, which develops and sells software aimed at small and midsize businesses to handle business-process management, customer relations and other functions.

Previously, he led development of the group's main product line, Dynamics.

Nadella will report to Jeff Raikes, president of the Microsoft Business Division.

The Microsoft Business Solutions (MBS) group was essentially created through two major acquisitions. In April 2001, Microsoft bought Great Plains Software, based in Fargo, N.D.

Burgum, founder and chief executive of Great Plains, joined Microsoft but remained based in Fargo, where the company maintains a large operation.

In July 2002, Burgum led Microsoft's acquisition of Danish business-software company Navision.

Last November, Microsoft announced a search for Burgum's replacement. At the time, he was to assume the title of chairman of MBS, responsible for driving greater awareness and adoption of MBS products.

Burgum did not intend to leave the company completely at that time, he said in a conference call Tuesday.

However, with the state of the group — it turned its first annual profit, $24 million, in the fiscal year ended June 30 — and the appointment of an internal replacement, he said he felt comfortable leaving.

"I feel I'm being very true to my original intentions, which was my commitment to Jeff [Raikes] and [CEO] Steve [Ballmer] to make sure that we help drive the business forward and ensure that we had a smooth and transparent and effective leadership transition," Burgum said. "I believe that will certainly have been accomplished by the end of next June."

MBS is not without its challenges, however.

Burgum said the company needs to work on building its low market share, entering more markets around the world.

Competitors include Intuit, Sage, SAP and Oracle, as well as online providers such as

Burgum said he made the decision to leave last Friday afternoon after discussing the matter with Raikes and Ballmer over the course of last week.

He said he has spent little time thinking about his plans after Microsoft.

Benjamin J. Romano: 206-464-2149 or

Satya Nadella will head MBS.