Nadella speaks about women and raises, post-Hopper

SAN FRANCISCO — When Microsoft CEO Satya Nadella agreed to meet with USA TODAY a few weeks ago to discuss his cloud-first initiative for the storied tech company, he had yet to appear as a guest at the Grace Hopper Celebration of Women in Computing on Oct. 9 in Phoenix.

When the host of that event asked for Nadella's advice for women who didn't feel comfortable asking for a raise, Nadella responded that they should demur, "knowing and having faith that the system will give you the right raise."

The reaction from a variety of quarters was quick and condemning, noting that advising women not to speak up for themselves as they struggle for pay equity was tone deaf at the very least. Nadella immediately tweeted an apology saying: "Was inarticulate re how women should ask for a raise. Our industry must close gender pay gap so raise is not needed because of bias."

Telle Whitney, CEO of the Anita Borg Institute and sponsor of the Grace Hopper event, says Nadella's comments "demonstrated a cluelessness about women and salaries, but I've been impressed with his apology and more so by the fact that he heard that this is important to women and he's taking it up at Microsoft."

In a recent address to employees, Nadella again lamented his comments and said Microsoft would step up its efforts to recruit more women and minorities.

The transcript of what Nadella told USA TODAY on the topic follows:

USA TODAY: I'd love to just start with perhaps the obvious, which is the Grace Hopper situation, which is to me so fascinating because you almost stumbled into something that has started a really important dialogue. And I'd love to get a sense from your perspective of have you gone through a cycle of feeling, wow, what did I say, to I'm actually glad I said it?

SATYA NADELLA: Yeah, I mean, it's a humbling and a learning experience. In fact, I just had my (employee call) and I talked about this. One of the best pieces of advice I got when I became CEO was be bold and be right. You know, it's one of those things which is what each of us has to ultimately do, which is if you don't take risk, you're not going to accomplish much. And if you're not right, you're not going to be accomplishing much.

And in this case I took the bold step of going to Grace Hopper as the first male CEO to go talk about it. And I really wanted to go there to engage, understand, learn, because I wanted to understand what are the sensitive issues, what are the things that I can now have better empathy for so that we can go work them in our culture.

But my answer to that one question, which I interpreted super narrowly, was just wrong, you know, because I answered basically by my own experience of how I managed my career through all the mentors I've had and in the belief that if you do your work passionately, you will always see the rewards, even if there is some amount of delay.

But the mistake is to take your own personal experience and project it on half the humanity. It's just insensitive, because, you know, it's over-fitting.

And that I think is the real reflection, I had, which is — and I've said this before — it's generic, gender-neutral advice I've given many times. But what struck me most even since then, to your point about reflection, is as I talk to other senior women and generally anyone, and their stories of how, for example, quote unquote, the system has actually not worked for them. And when you hear that and you sort of really recognize what a raw nerve my comments, especially around being passive, makes no sense. I mean, I don't believe in it at all, which is if you see bias you want to aggressively take action against it. Both me as a leader has to act to make sure that we are correcting for it, we're enabling and creating a culture where people are not facing bias, and as an individual I won't stand for it. I would call — you know, I would advocate for myself.

I was asked — I interpreted the question very narrowly. I was, in fact, trying to bolster the confidence of those women who feel that they don't want to ask. And I was saying, hey, it will work out OK because it worked out OK for me. But that is not what was really the answer that they were looking for. They were looking for, hey, what are you as a leader going to do to change the bias, what practical advice do you have, which Maria (Klawe) gave, which was good practical advice, which is lean in and advocate for yourself. So, good learning.

USA TODAY:Did you get a response from within the company, especially from female employees at Microsoft saying, well, hang on a second, does that mean I shouldn't ask or should I ask or what should I do?

NADELLA: No, I was very clear that if you feel any — I mean, basically the thing that as I reflect on it is if somebody asked the question to me, should I passively accept if I'm faced with bias, I would say absolutely no. You should absolutely not passively accept any such thing and you should advocate for yourself, find the mentors, find the sponsors and go make the case. And I as a leader will make sure that it's a safe environment for you to be able to not be passive. That's the spirit and that's the culture.

USA TODAY:And I have to ask you this because it's such a hot topic in Silicon Valley right now, which is diversity in the tech world broadly speaking. What are your thoughts on that or how can companies improve on that front?

NADELLA: I mean, you just have to go work on it. In fact, the way I even said this at Grace Hopper is I don't even want to fall on the crutch of the supply issue. I've got to tackle it really internally even. Let's take women, although after all this applies not just to women, it applies to quite frankly all underrepresented minorities, even African-Americans, Native Americans. We have an issue broadly, which is the data every one of us is sharing. In the case of women we have 29%, but it drops to 17% when it comes to engineering.

Obviously, that's not the case in the real world of the customers that we are trying to serve. It's not even like, oh, let's do this because this is something that we want to do in addition to our innovation. No, this is necessary if you want to build successful products, especially in our case where we're very global, we sell across all economic strata, we sell obviously to all genders, all ethnic groups. And so therefore having a diverse workforce is a necessity to do innovation that's going to be relevant in the world.

And you're going to have to go tackle it one step at a time. Like any other thing where you're trying to make progress in business, what do you do? You set goals, you achieve them, you set higher goals, you achieve them, and keep it front and center.

And quite honestly, we've been working on this. I wish we had made more progress but we have made some progress.

One of the pieces of data that we even talked about today, because after coming back from here, the conference, I just asked our HR department to just go look at pay equity, right, just per similar, same level and same title, what is the compensation? And it turns out we don't have disparity. In our case it's always in a tight band of 0.5%.

And so I feel good about that, but that doesn't still answer all the questions of velocity, of promotions, are there enough women and other minorities in senior ranks, not enough. Those are the things that we've got to go work on.