Pros

-- One of the few companies who can actually deliver on a 'promise' of opportunities to move around within the broader organization, based on interests, skills, availability, etc.
-- Brand name recognition
-- The opportunity to be involved in products and initiatives seen and used around the world.
-- Working with smart, dedicated people
-- The benefits are, hands-down, the best of any company I've worked for in a 20-year career (as in, no deductible after the initial annual one, pick up your prescription and don't pay a *cent*, chiropractic and therapy sessions all covered, etc., though dental is capped at a relatively low rate)
-- Great for hard-charging people who are adept at managing politics, meeting high (often un-stated) expectations, patient in the need to regularly revisit past decisions, thrive in changing environments and who can prioritize on a dime with little information

Cons

-- Typically, people are brought in to hold responsibilities they had at least one or two jobs ago (as if being a stellar performer elsewhere requires sliding backward when at Microsoft)
-- Resistant, at least in marketing where Microsoft's marketing prowess needs to be updated, to new ideas if nothing appears definitively "broken" about the current way
-- Unless you're in a position deemed as officially "creative", there is little room for bringing creativity to bear
-- Really, really bad people managers are the norm; good managers are extremely hard to find and they (at least in Marketing) are expected to achieve an almost-impossible, and certainly exhausting and unsustainable, level of their own "individual" work in addition to managing a team. This, despite some wide-ranging and high-potential programs put in place as required.
-- Rewards seem out of whack. Really, really, really, really bad people-managers stay employed, get inexplicably promoted if they appear to improve over a few months or get transferred to another group (where they can wreak havoc on someone else's watch). I know of at least three instances of this, where each had numerous complaints to HR, poor marks from direct reports during annual surveys, high rates of team turnover, general unhappiness, etc.
-- Incentives are often misaligned with other teams (or not even considered in line with those teams).
-- The most difficult promotion to achieve (other than to President/CEO, of course) is from senior manager to director. It essentially requires a calculated, two-year campaign of project assignments, awareness-building to potential 'voters' of your personality and accomplishments, the stars to align under a blue moon and not a single detractor among the voters. Can be done, certainly, but it's a brutal, unpredictable, ruthless process.

Advice to Senior Management

Recognize that your actions speak louder than words with employees (particularly when you reward bad behavior and/or don't require managers to cultivate the best from their employees, who likely all have different types of intelligence, communication style and ways of operating).
Recognize that your bad apples become rotten and the rot spreads. Though they may appear to have been integral to a product's or project's success, others will actually step up to fill the void you're fearful of creating by actually finding someone who can lead *and* build a positive work environment.
Align goals across organizations that work together.
Recognize that making everyone fit a certain 'type' doesn't equal success ultimately.
Stop over-analyzing things before trying them, and you might just truly innovate again.