Microsoft CEO Satya Nadella has ordered a radical AI transformation, telling leaders to rethink every part of the business. Internal documents and interviews show he is consolidating power around AI teams, speeding product cycles, and demanding leaner execution. He promoted longtime sales chief Judson Althoff to run the commercial business so he can focus on technical work, and launched a weekly AI accelerator meeting where frontline engineers—not executives—present. Nadella also opened exclusive Teams channels for senior leaders, directing them to act like individual contributors and learn from early-career talent. The shake-up is pressuring veterans such as Rajesh Jha and Charlie Bell to consider retirement, signaling possible turnover at the top. Insiders say the new structure gives Nadella “extra bandwidth” to lead what he calls a “tectonic AI platform shift,” a moment he ranks alongside Microsoft’s move to cloud.