The Microsoft CEO succession process appears to be stalled. This is a company with immense human, technical, and financial resources; the tech industry is filled with intelligent, energetic, dedicated candidates. What’s wrong with the matchmaking process?

Blond, Japanese, 25 years old, 15 years experience — and bisexual. This is a caricature, but only barely, of the impossible CEO job specs that executive recruiters circulate when on a mission to replace the head of a large company.

The real list of requirements describes a strategist with a piercing eye for the long term… and daily operational details; a fearless leader of people, willing to inflict pain… but with a warm touch; a strong communicator, a great listener, and an upstanding steward of shareholder interests…and of the environment.

When I gently confront a recruiter friend with the impossibility of finding such a multi-talented android, he gives me the Gallic Shrug: “It’s the client, you know. They’re anxious, they don’t know what they want. So, to tranquilize their Board, we throw everything in.”

I ask the distinguished headhunter what character flaws will be tolerated in a candidate. The query is met with incomprehension: “What? No, no, we can’t have character flaws; this situation requires impeccable credentials.” And perfect teeth, one assumes.

Still in a caustic mood, I prod the gent to picture himself driving to Skyline Boulevard and walking to the top of Borel Hill, a great place to meditate. Turning away from the hills that gently roll down to the Pacific, he faces the Valley. Can he sit, quiet his mind, and visualize the gentle crowd of pristine CEOs down there?

No. He’ll see a herd of flawed men and a few women who regularly exhibit unpleasant character traits; who abuse people, facts, and furniture; and who are yet successful and admired. Some are even liked. There are no Mother Theresas, only Larry Ellisons and Marisa Mayers, to say nothing of our dearly departed Steve Jobs. (Actually, the diminutive Albanian nun was said to have had a fiery temper and, perhaps, wasn’t so saintly after all.)

For a large, established company, having to use an executive recruiter to find its next CEO carries a profoundly bad aroma. It means that the directors failed at one of their most important duties: succession planning. Behind this first failure, a second one lurks: The Board probably gave the previous CEO free rein to promote and fire subordinates in a way that prevented successors from emerging.

Is this the picture at Microsoft? Is the protracted search for Steve Ballmer’s successor yet another sign of the Board’s dysfunction? For years, Microsoft directors watched Ballmer swing and miss at one significant product wave after another. They sat by and did nothing as he lost key executives. Finally, in January of this year, Board member John Thompson broke the bad charm and prodded Ballmer to accelerate the company’s strategic evolution, a conversation that led to the announcement, in August, of Ballmer’s “mutually agreed” departure.

Having badly and repeatedly misjudged the company’s business and its CEO, is the Board looking for an impossibly “well-rounded” candidate: the man or woman who can draw the sword from the stone, someone with a heart and mind pure enough to put the company back on track?

For some time now, we’ve been hearing rumors that Ford’s current CEO, Alan Mulally, could become Microsoft’s new CEO. Mulally is well-respected for his turnaround experience: Since 2006, he’s been busy reviving the family-controlled Ford, the only Detroit automaker that didn’t need (or take) bailout money. Before Ford, Mulally spent 37 years in engineering and executive management positions at Boeing, where he rubbed elbows with Microsoft royalty in Seattle.

As the rumor has it, Mulally would be appointed as a transitional leader whose main charge would be to groom one of Microsoft’s internal candidates and then step aside as he or she assumes the throne. Will it be (the rumor continues) Satya Nadella, Exec VP of Cloud and Enterprise activities? Or former Skype CEO Tony Bates, now a post-acquisition Microsoftian? Both are highly regarded inside and outside the company.

(I’m surprised there aren’t more internal candidates. Tech pilgrim Stephen Elop is sometimes mentioned, but I don’t see him in the running. Elop has served his purpose and is back in Redmond — some say he never really left — after a roundtrip to Finland during which he Osborned Nokia, thus lowering the price of acquisition by his former and again employer.)

On the surface, this sounds like an ideal arrangement.

And yet…

For all his intellectual and political acumen, his people and communication skills, Mulally possesses no domain knowledge. He has none of the bad and good experiences that would help him understand the killer details as well as the strategic insights that are needed to run Microsoft — insights that, in retrospect, Ballmer lacked.

But, you’ll say, this is no problem; he can rely on the CEO-in-waiting to evaluate situations for him and make recommendations. No. Mulally would have no way to really weigh the pros and cons outside of the streamlined charts in a fair and balanced PowerPoint presentation.

In addition, the grooming process would prolong the company’s confusing interregnum. The people who have to perform actual work at Microsoft will continue to wonder what will happen to the party line du jour when the “real” CEO finally assumes power. The uncertainty discourages risk-taking and exacerbates politics — who knows who’ll come in tomorrow and reverse course?

Fortunately, the Mulally proposition no longer seems likely. The latest set of rumors have Mulally staying at Ford until the end of 2014. Let’s hope they’re right. Wall Street seems to think so… and expressed its disappointment: After regularly climbing for weeks, Microsoft shares dropped by 2.4% on Thursday, Dec 5th, after Mulally declared that he wouldn’t jump ship.

So where does Microsoft turn, and why are they taking so long? Once you put aside the Mr./Ms. Perfect fantasy, there’s no dearth of capable executives with the brains and guts to run Microsoft. These are people who already run large corporations, or are next-in-line to do so. Exec recruiters worth the pound of flesh they get for their services have e-Rolodexes full of such people — some inside the company itself.

Now, place yourself inside the heart and mind of this intelligent candidate:

‘Do I want to work with that Board? In particular, do I want Bill Gates and his pal Steve Ballmer hovering over everything I do? I know I’ll have to make unpopular decisions and upset more than a few people. What’s in it for me — and for Microsoft — in a situation where unhappy members of the old guard would be tempted to go over my head and whine to Bill and Steve? How long would I last before I get fired or, worse, neutered and lose my mind?’

Consider it a litmus test: Any candidate willing to accept this road to failure is automatically disqualified as being too weak. A worthy contender makes it clear that he or she needs an unfettered mandate with no Office Of The Second Guessing in the back of the boardroom. Bill and Steve would have to go — but the Old Duo doesn’t want to leave.

It’s a stalemate…and that’s the most likely explanation for the protracted recruitment process.

We’ll soon know where Microsoft’s Board stands. Will it favor a truly independent CEO or will it cling to its past sins — and sinners?

Or, as a Valley wag asks: Which elephantine gestation will end first, that of Microsoft’s new CEO, or Apple’s equally well-rounded Mac Pro?

— JLG@mondaynote.com