Data is a precious resource, and as a company we need to make fewer decisions on intuition and more based on market and other data. In a post last month, Satya discussed the need for companies to create a data-driven culture, and we want to be leaders as we explore creative, diverse strategies to create greater value for our customers and greater value from our product/service data exhaust.
One demonstration of our intent to lead is the hiring of Preston McAfee (pictured below and right) as chief economist, reporting to me. Preston, most recently director of Google strategic technologies, will be responsible for leading a team of economists who will work closely with Amy Hood, our chief financial officer, and business and engineering groups across the company on developing new business models and metrics, designing marketplaces for advertising and apps, assisting with government relations and policy, and developing an economic strategy for the company.
This isn’t the first time Preston will be a chief economist. For five years, from 2007 to 2012, Preston was chief economist and research fellow for our search partner, Yahoo!, where he captured our attention by building a great team that became well known for doing interesting research while ensuring it was impacting current products.
Preston’s other current professional activities include advisor to Rand Education; council member, Game Theory Society; founding co-editor ACM Transactions on Economics and Computation; and member of the Board of Governors, Pardee Rand Graduate School.
Preston has impressive academic credentials, including most recently from 2004–2009 as the J. Stanley Johnson Professor, California Institute of Technology. He has been awarded several patents; published two economics textbooks, Introduction to Economic Analysis, a free, open sourced, creative-commons-licensed textbook spanning introductory and intermediate microeconomics; and Competitive Solutions: The Strategist’s Toolkit; and published extensively. In 2011, Preston was named a distinguished fellow of the Industrial Organization Society and in 2009 a Sparc Innovator. In 2008, he received an Honorary Doctorate in Economics from Purdue University; in 2006 an ASCIT Teaching Award for Mentoring; in 1997 the John S. Day Distinguished Alumni Award, Purdue’s Krannert School of Management; and in 1995 he was named a Fellow of the Econometric Society.
Susan Athey (pictured left), the Economics of Technology Professor at the Stanford Graduate School of Business, and a long-time advisor to Microsoft who participated in our selection process, has deep respect for Preston’s work and accomplishments.
“Preston is a world-class researcher in micro-economics and marketplace design who brings to Microsoft a unique blend of research depth combined with real-world applicability. His past work has brought together economics, computer science, and engineering to create innovative solutions for problems such as the design of efficient auctions for telecommunications spectrum and display advertising. He’s also interested in applying economics and machine learning to inventing and building new tools that improve business operations and create value customers, so he brings a great skill set for the breadth of Microsoft’s products.”
Our industry is barely a hundred years old, and we’re certainly entering a new, more human era of computing where our technology and the companies that provide it will work more under the user’s control and at the user’s command. Our economic models are evolving, too. In the Ford economy, you got what was available: one car, one color; in the Starbucks economy you got what you ordered, no matter how complicated; and now in the Pandora economy, you get what you like because the service keeps learning about you, tuning itself to your needs and desires.
We are incredibly optimistic about the path forward for the IT industry and for Microsoft, and we’re excited for the role Preston will play in working directly with our senior leadership team and product/service groups across the company in leading Microsoft on this customer-centric path.