Salesforce.com's Marc Benioff: Microsoft's Next CEO?

NEW YORK (TheStreet) -- Two months ago I wrote an article about the type of CEO Microsoft (MSFT) may be seeking to replace outgoing CEO Steve Ballmer.

The tech giant might seek someone who will cut costs and personnel, among other moves, while improving efficiency to increase profits and margins. That's fine but eventually it will be a losing strategy.

That's because complacency is the centerpiece of this strategy, one that BlackBerry (BBRY) used very well just several years ago -- but look at where it is now.

There's nothing wrong with increasing margins and becoming a more efficient company -- but by sitting back and playing defense, someone's going to eat MSFT's lunch eventually.  That someone will probably be Google (GOOG) or Apple (AAPL) or both. 

MSFT should worry about growing revenue and the person who will be at the helm to grow them. 

To do that, I think Microsoft should buy Salesforce.com (CRM). 

Madness, perhaps. But consider the acquisition would bring Marc Benioff, the CEO of Salesforce.com.

This man is on a mission to end software as we know it and his company sits atop the rapidly growing cloud industry. MSFT could use CRM to drive the top line while perfectly integrating it into its own enterprise business, which is something end-users would love to see. 

It could also provide a boost to MSFT's tablet and smartphone products, especially for the type of people who want them for work, not play. 

Microsoft has tons of business segments -- Xbox, Bing, Skype, software. But Bing has remained a loser behind Google search and, unfortunately, Xbox has not been exploited for its true potential. Skype is okay for some people, but Facetime and other similar services are rendering it less relevant. 

Regardless, there are plenty of PC-ers out there and Microsoft is a huge name in the business landscape. So it has its purpose in the world. 

One could make the case that some of its businesses should be spun off to unlock shareholder value. I'm not going to get into that. I'm focused on who will do that, should it come to pass. 

Benioff would be a good fit to run the Microsoft empire. The question is whether Microsoft will open its wallet and buy the company, which wouldn't come cheap. The valuation is obviously a big part of any CRM acquisition, and has been for years. Yet, Salesforce continues to grow revenue -- increasing 84% from fiscal 2011 sales of $1.65 billion to $3.05 billion in fiscal 2013 -- while reinvesting in itself and doing its own M&A activity. 

Microsoft could do a cloud overhaul in-house for less but my point is it needs someone who can find a way to grow the company and to think outside the box, rather than just trying protect what it has already built. Complacency is never good. 

Microsoft will likely stick with the safe pick and choose someone who can boost efficiency and push around decimals to improve margins. That's a solid game plan over the next year or two.

But Microsoft needs to do something different. It has built this magnificent garden that continues to produce acceptable fruit. But as time goes on, its competors continue to invade its space, stealing acreage and lowering the crop output. 

It's time Microsoft brought in a new farmer and extended that garden, giving its shareholders some delicious new fruit.

-- Written by Bret Kenwell in Petoskey, Mich.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

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