Microsoft Pledges Not To Miss Out On The Next Big Tech Product

According to a CNBC report, Nadella already acknowledged that Microsoft "clearly missed the mobile phone" opportunity. However, the rise of the smartphone has to peak at some point and there will be a new tech product to take its place.

Nadella said that a top priority at Microsoft is to create a culture of pushing boundaries as one "concept needs to be replaced by a new idea."

"In order to build a new concept, you need to build a new capability and that's where your culture can get in the way," Nadella said.

Nadella cited a little-known technology it has been working on called HoloLens, a headset that combines Microsoft's gaming expertise from its Xbox unit along with workplace productivity applications. The technology has various uses in areas including healthcare and architecture.

Nadella recalled years ago when he hired top engineers to "dream the dream" and create a technology that is capable of holographic computing.

"That is capability building: having that foresight, forcing yourself to do things that are not the easy to do," Nadella said. "It's not about the next day, the next quarter, next year. It's one of the fundamental challenges of leadership and you got to get it right: you can't be too far ahead, you can't be too far behind."