Microsoft's board of directors has officially appointed Satya Nadella as its new CEO and board member. Nadella was previously the executive VP of Microsoft's Cloud and Enterprise group, and has been with the company since 1992. The company also announced that former CEO Bill Gates is taking a new role within the company as well.

Gates' new title will be founder and technology advisor, and he will devote more time to the company supporting Nadella and shaping its direction. John Thompson, previously an independent director, will take over Gates' roll as chairman of the board. This follows outgoing CEO Steve Ballmer's announcement in August that he would retire within 12 months.

"During this time of transformation, there is no better person to lead Microsoft than Satya Nadella," Gates said in the announcement. "Satya is a proven leader with hard-core engineering skills, business vision and the ability to bring people together. His vision for how technology will be used and experienced around the world is exactly what Microsoft needs as the company enters its next chapter of expanded product innovation and growth."

In a letter sent to employees, Nadella praised the previous CEOs and signaled his own plans.

"While we have seen great success, we are hungry to do more," he wrote. "Our industry does not respect tradition--it only respects innovation. This is a critical time for the industry and for Microsoft. Make no mistake, we are headed for greater places--as technology evolves and we evolve with and ahead of it. Our job is to ensure that Microsoft thrives in a mobile and cloud-first world."

Gates' new role as an advisor is telling, given that Ballmer was widely criticized for the slow speed with which the company adapted to new technologies with the Windows Phone and Surface. Nadella is the new CEO, but the company's structure seems to indicate that Gates will help steer the ship.