Grant: Then-CEO Steve Ballmer stepped down. You were not on the short list for CEO. How did you prove you were the guy?
Nadella: I was not sitting around in my office waiting for Steve to retire! (Laughter) I was asked to raise my hand and the board did what it should do -- I talk about this in the book. I was asked by the board "Do you want to be the CEO?" and I said, "Well, only if you want me to be." That's just who I am. I remember recounting that to Steve (Ballmer) and he said, "Well, it's too late to change."
Grant: Every year in leadership class, we show Ballmer doing his monkey dance. But that's not you.
Nadella: I grew up in the company that Paul Allen and Bill Gates founded, and that Bill and Steve built. The best advice Steve gave me was, "Don't fill my shoes. Be your own person." I did the best to learn from them.
Grant: You organized a major culture change. One of your first quotes: "We're known as the know-it-all company. We need to become the learn-it-all company." What led you to that?
Nadella: The product was a hit. Microsoft had grand success. In the late '90s and 2000s, there was daylight between us and the competition. Now it's a cluster of six or seven of us. The inspiration for that quote came from reading Carol Dweck's work, around mind-set, I borrowed it completely.
Grant: You're candid in the book "Hit Refresh" about challenges in your family and how you developed empathy.
Nadella: Most people think empathy is a soft skill, not relevant to the hard work of business. If you look at innovation, it's your ability to grasp the unmet, unarticulated needs of customers. It comes from empathy. It's not a button you switch on.
Life teaches you that. The birth of my son, Zain, changed that. That night everything changed. Because of complications, he was born with cerebral palsy. For years, I struggled with it. Why did this happen to me? My plans are out the window.
Then, I watched my wife driving him to appointments and doctors, trying to give him the best shot, the best chances. Over the years, I realized nothing happened to me; something happened to Zain (now in his 20s). I had to step up and be the parent and the father. See life through others' eyes, even someone as close as your own son. (The Nadellas got married in 1992. Besides Zain, they have two daughters, Tara and Divya.) People talk about compartmentalizing work life and private life. The reality is, how does one do it?