Lesson #2: Develop an A-Team

“At Microsoft, there are lots of brilliant ideas but the image is that they all come from the top,” says Gates. “I’m afraid that’s not quite right.” While Gates has been the famous face of Microsoft for over thirty years, it took the help of numerous other trusted individuals to help realize the company’s success.

When Allen and Gates first met as students at Lakeside, they instantly formed a strong bond over their passion for computers. And, it was a bond that would last for the rest of their lives. Knowing each other’s strengths and weaknesses, interests and passions and having a strong sense of trust enabled these two entrepreneurs to form one of the most successful working relationships of the 20th century.

Gates, recognizing the importance of a solid and trustworthy team, also brought on two former high school friends, Ric Weiland and Marc McDonald, to be part of the core Microsoft group. Gates knew that if Microsoft was going to get its feet off the ground, it was going to take the hard work and sweat that he trusted few others to put in. From day one, he understood the importance of having a small team that could join together each person’s enthusiasm around a common goal.

When Gates moved the operation to Seattle in 1979, he had a staff of 16 people. As Microsoft grew, so too did the number of employees that the company required. Gates continued to bring in trusted friends of his whose characters he understood and who he knew he could trust, including his friend from college, Steve Ballmer, who was thereafter in charge of human resources. “Steve and I were kind of driving the business and Paul and I were driving the technology,” recalls Gates. “Our success has really been based on partnerships from the very beginning.”

The move to Seattle proved to be a boon for Microsoft in that it enabled the company to have a much wider range of skilled candidates to choose from. “In the world of software a lot of the brilliant ideas of Microsoft come from a broad set of great people we've been able to hire,” says Gates. In one particularly key move, Ballmer hired Charles Simonyi, one of the original founders of the Xerox Palo Alto research lab, whose knowledge about graphical interfaces made a significant contribution to Microsoft’s later graphical applications.

As their number of staff began increasing into the thousands, the company typically focused on hiring people right out of school. “Most of our developers, we decided that we wanted them to come with clear minds, not polluted by some other approach, to learn the way that we liked to develop software, and to put the kind of energy into it that we thought was key,” recalls Gates.

Microsoft continues to seek out only the best in order to help it stay ahead of its increasingly fierce competition. “The key for us, number one, has always been hiring very smart people,” says Gates. “There is no way of getting around, that in terms of IQ, you’ve got to be very elitist in picking people who deserve to write software. Ninety-five percent of the people shouldn’t write complex software.”

By hiring the best and the brightest and carrying out work in small teams that stimulate free and creative thinking, Microsoft has managed to retain its competitive edge for over three decades.

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