Clad in jeans and a gray sweatshirt,Amy Hood stands before a room of 140 Microsoft recruits. Thefeeling in the air is a bit like the first day of school,and new hires are taking selfies outside in front of a bigMicrosoft logo.Hood tells the crowd that her job as CFO is notsimply to balance the books and plan spending, although she'spretty good at that. Her main role is to make sure every one ofthem is glad they chose Microsoft. “My kids will tell you Ipractice counting, but my job is really a little different thanthat,” she tells the crowd, grouped at round tables by thebusiness unit they're joining. “I may have thought about it thatway when I took the job almost five years ago. But now it's aboutcreating an environment in which you all remember that you stillwant to pick us every day. That's my job as a CFO.”It's not howmost people think of the role of finance chief. But since takingthe gig in 2013—making Hood Microsoft Corp.'s longest-tenuredCFO since the mid-1990s in a company that wears down financeprofessionals—a more expansive view of the job is what keeps her init. Along with CEO Satya Nadella, Hood, 46, has played a key rolein winning people—employees, customers, investors—back to Microsoftafter the company spent more than a decade losing its way.Theworld's largest software maker, once undisputed ruler of thePC desktop, has remade itself into a cloud behemoth. This secondcoming looked highly unlikely when Hood took on the CFOjob. But since then she has partnered with Nadella to turn thecompany around, becoming more influential than previous MicrosoftCFOs and translating her boss's strategy and product prioritiesinto precise spending plans and forecasts. She hasrefocused Wall Street on cloud computing metrics and handilybeat them.“She was able to change everybody's perspective on acompany where everyone thought their best days were behind them,”says Heather Bellini, a Goldman Sachs analyst who has coveredMicrosoft for more than 15 years. “People view her as being veryinstrumental to the change in strategy at Microsoft. Satya has donean excellent job but people think of them as a packagetogether.”The shares have been hitting record highs throughoutthe winter and spring, though that may be hard to sustain.Microsoft is battling tough competition from rival cloudproviders including Amazon.com Inc., which got a head start on thepack, and Alphabet Inc.'s Google, which is rapidly building datacenters. Those and other companies are also spending heavily onartificial intelligence, an area Nadella has committedconsiderable resources to. Microsoft has made big strides inhardware, and its tablets and notebooks are well-reviewed. But nonehas become a runaway hit. Finally, like theircounterparts, Nadella and Hood must contend witha brewing trade war between the U.S. and China, which couldhave an outsize impact on the tech industry.As Nadella plotsstrategy to cope with these challenges, Hood manages spending tosupport it. Microsoft is sitting on one of the biggest cash pilesin tech—$132.3 billion—and Hood is extremely judicious indeploying it. Acquisitions are carefully vetted, and she has shownherself willing to take money away from legacy divisions such asWindows that are used to getting what they want and giving itto more promising businesses like the cloud group. When challenged,she always has the data to make her case. Between pieces of herkids' artwork on a wall in her office hangs an award for“Excellence in Forecasting.” It's a finance geek's gag,bestowed on Hood by her team when they were badly wrong about aprediction and she was right.“She's not combative but she'sdetermined,” says former board member Maria Klawe. “She's reallygood at what she does. She's persistent, but she's not obnoxiousever.”Hood joined Microsoft in 2002 and expected to stay only a fewyears before decamping to a startup; she even timed her start dateto get the maximum access to the employee stock purchase plan. Butover time, she fell in love with the place and has emerged as oneof Microsoft's most passionate cheerleaders. In arare interview, she explains why she loves her gig. “Why doesanybody do a job?” she asks. “Because they think they can makea positive difference and feel like you want to be a part ofsomething. Those things are really true for me.”Hood was namedCFO during one of the bleakest periods in Microsoft history. Alast-ditch effort to drag Windows into the mobile era had largelyfailed, the PC market was sliding; investors, the board, and evensome of then-CEO Steve Ballmer's own executives didn'tbelieve he had the answers. Ballmer had begun moving intothe promising area of cloud computing, but the business was stillsmall. Frustrated shareholders—at least those whom alreadyhadn't given up and sold their shares—were starting to revoltagainst what they deemed insufficient focus and profligatespending.Hood was a few months back from maternity leave after thebirth of her second daughter when Ballmer offered her the job.Despite graduating from Harvard Business School and holding severalroles including Office group CFO, Hood hadn'tstudied finance in school and recalls feeling shewasn't ready for the job. A few years later, in 2016, Hoodtold a conference she always takes stretch jobs that are alittle uncomfortable and then grows in the role.Year One is tryingfor most new CFOs, but Hood couldn't have anticipatedthe chaos. Weeks into the job, she flew to Europe tonegotiate the purchase of Nokia assets; shortly after thatBallmer shook up the C-suite, giving Hood more power over thefinances of each product. A month later he announced hisdeparture.Microsoft gave a board seat to an activist investor,announced a narrower and cheaper Nokia deal, and started lookingfor a new CEO—all within two weeks. It took almost six months toreplace Ballmer with Nadella, who Hood knew well becausehe'd overseen small business accounting and customer software whileshe ran strategy for the larger Office group that included hisbusiness. At Hood's one-year anniversary as CFO, the legaldepartment gave her a plaque congratulating her for making itthrough the first 12 months.Once Nadella took over as CEO inFebruary 2014, Hood needed to correct missteps made on Ballmer'swatch. First up: the $9.5 billion Nokia deal. Less than a yearafter closing, it was foundering and had missed Hood'sinitial forecast for sales and savings. “Once theforecast failed to pan out, Amy was extremely rigorous on firstcalling attention to the failing performance and then encouragingeveryone to focus on making hard decisions quickly," says MicrosoftPresident and Chief Legal Officer Brad Smith, whose office shares asmall hallway with Hood's.During the interview in May atMicrosoft's Redmond, Washington, headquarters, Hoodacknowledges she will make mistakes and says she's comfortablemaking tough decisions once she has the right data. She doesn'tbelieve in continuing a strategy or an investment just because thecompany has already spent a lot or put in a lot of work. “You can'tchange anything,” she says. “[A] time machine doesn'texist. So reflect, learn, and move on. I just don't dwellmuch on those things. Otherwise you get too fearful. You loseyour bravery.”Nadella and Hood are trying to fix Microsoft's spottytrack record on big deals. Rather than buying shrinkingbusinesses such as Nokia to prop up ailing ones likeMicrosoft's mobile software unit, they look for strong companies ingrowing sectors. Where appropriate, they provide financial metricsthen let acquisitions run on theirown. LinkedIn, acquired in 2016, must meettargets for revenue, profit margins, and user engagement. Eighteenmonths after the deal closed, LinkedIn's results have been“materially better than our expectations,” says CEO Jeff Weiner.“We haven't seen this degree of sequential acceleration of thismany quarters since 2011. Independence has worked well for us.”GitHub, the software development platform, will be treated much thesame way once the deal closes this year.Microsoft execs, whopreviously had a tendency to meddle with new acquisitions, aredissuaded from making demands of them. “A lot of times we'd do anacquisition and it was sort of like turning a puppy loose in a roomfull of kindergartners,” says Dave O'Hara, a 17-year Microsoftveteran who oversees finance for cloud, Office, andartificial intelligence.It will take several years to tellwhether the $26 billion LinkedIn acquisition and integration havebeen a success. Other Microsoft deals, including some that Hoodworked on when she oversaw Office group finances, lookedbetter shortly after they closed than they do now. Forexample, since acquiring Skype, Microsoft has alienated consumersby refocusing the online calling service on corporate customers,prompting many long-time users to defect to services operated byApple, Google, Facebook, and Snap.Hood came to the CFO jobwell-equipped to handle balky shareholders. Her first job atMicrosoft after joining from Goldman Sachs was investor relations.She got Ballmer's attention by vigorously disagreeing with hisreluctance to woo Wall Street. “My first impression was this ladyis smart and she's willing to push back, she's got an edge, she hasher own point of view and is not just going to parrot whatmanagement thinks,” Ballmer recalls. “She didn't makeheadway with me at the time, but she didn't sit there like adoormat and say 'yeah, yeah, yeah, whatever.'” He says Hood isthe best CFO Microsoft has ever had.After Ballmer left, therelationship with Wall Street needed tending to. The shares hadgiven up a third of their value during his tenure, even thoughsales almost quadrupled. Fritz Foley, who attendedHarvard Business School with Hood and went on to become a professorthere, recalls her frustration during an interview for a casestudy. “We had consistent performance but generated no confidence,”Hood told him. “People did not believe we were relevant.”Foley says some value investors even wanted Microsoft to quitpushing into new businesses and simply milk Windows andOffice.At an executive retreat in 2015, Hood lectured seniorleaders on the need for more internal and external metrics to keepemployees on a measurable path and communicate better to investors.Nadella and Hood hatched a plan to refocus investors on the smallerbut growing cloud business, pledging in April of thatyear to reach $20 billion in annualized revenue from thecommercial cloud business by fiscal 2018, a goal they passed in thefirst quarter. It was a “look over here” move that tookinvestors' eyes off the waning PC business.“The negatives werewell understood by Wall Street,” says Sid Parakh, a portfoliomanager at Becker Capital Management, which owns Microsoftshares. “The positives around 'here's all the great things wecan do in the cloud' were not as well understood becauseinvestors were like 'show me the growth.' It needed to becarved out so investors could tangibly feel the potential.”Hoodunderstood, however, that to sell investors on a host ofnew predictions, she needed to be sure she was right. So sheturned to Microsoft's machine-learning software. Her team plugshundreds of thousands of data points into the algorithms,which learn and make predictions on futurerevenue, costs, headcount, even contracts at risk. Thesoftware can tell Hood what types of job Microsoft should hire forand how adding people in those roles correlates to sales increases,which has helped the company do a better job hiring theright kind of salespeople.The machine-learning tools are part of abroader overhaul Hood calls “Modern Finance,” whichincludes updating 20-year-old software. Hood's fiefdom is aradically different place from most corporate finance departments,which are rarely at the vanguard of experimentation. In fact,the machine-learning finance tools are working sowell Hood's team is trying to sell them to their counterpartsat other companies.Hood tries to give her people room to run.Bridgette Link runs Modern Finance and has broad discretion todetermine what kinds of tools will make the most positive impact onher staff. Link says her boss had one request: “flawlessexecution.” When Link was asked to take an ax tocorporate policies governing things like travel andpurchasing, Brad Smith suggested she trim about 20 percent ofthe 1,800 policies. Hood told Smith he was letting the team offeasy. She asked for 50 percent. Link delivered a 92 percentcut.When the urge to meddle becomes too strong, Hood bakes.She's obsessed with creating structurally complex pastry,complete with working parts. A rocket resulted in many“#PinterestFails” she says. Recently she built a Paw Patrolcake for her daughter, complete with a large tower. She remembersthat her mother's homemade cakes made her feel cared for, and soshe does the same for her two daughters. Her youngergirl's birthday happens to coincide with the end ofMicrosoft's fiscal year. Hood lets her team close the books andthrows herself into baking the best birthday cake ever.A reticentinterview subject who typically confines her public comments toearnings and investor calls, Hood brings the cake anecdote to aclose. She's done talking about herself: “That's probably asinteresting as I'll ever be.”

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