Alan Mulally may be ready to leave Ford Motor Company (NYSE:F), but that doesn’t mean the executive is headed directly for Microsoft Corporation (NASDAQ:MSFT). Mulally appears to be the market favorite to take the position at the head of the company, and his potential seems the biggest driver behind the company’s recent rise in value.

Microsoft shareholders are optimistic for the first time in years. They’re betting on a company willing to transform itself, and they’re putting a lot of money behind that bet. Shares in Microsoft have risen by more than 12 percent in the last three months.

Microsoft Rise Unpredictable

Microsoft Corporation (NASDAQ:MSFT) does appear to have a good strategy for the new realities of the computing market. The company has refocused on enterprise services, and it seems clear that the company’s devices are an attempt to add value, to that enterprise spending rather than an attempt to challenge Apple Inc. ()NASDAQ:AAPL) for the center of the market.

This strategy lead to excellent financial results in the third quarter of the year, and a more than 38 percent rise in the value of the company over the course of the year. Microsoft Corporation (NASDAQ:MSFT) shares are trading where they were in the heady days of the dot com bubble.

Investors have a lot of faith in Microsoft Corporation (NASDAQ:MSFT), but the company’s rise has been based on little more than potential. The firm is performing strongly, but it has done little to prove its worth. Meanwhile risks haunt the company, and its investors.

Danger Haunt Microsoft

Despite the apparent confidence of the market, there are many things that could affect Microsoft Corporation (NASDAQ:MSFT) and drive the value of the firm’s shares down. The company has still not selected a CEO. That search may end with Mulally, or the company may end up with another executive at the helm.

A new leader can lead to a change in culture, and a change in culture an lead to a plethora of effects on a company. Microsoft shareholders need to price that rusk into the shares when they look to buy into the company.

Leadership risk is, of course, not the only problem that Microsoft faces. The software company is facing strong competition, and its moat isn’t as strong as it was in previous years. The performance of the company’s Windows 8 operating system has weakened the Microsoft brand, as has the company’s miserable results form the original Surface tablets.

Microsoft Corporation (NASDAQ:MSFT) has a long way to go before it looks as safe as it did just a few years ago. Alan Mulally may be the man to turn the company around, but if Microsoft decides not to bring in the Ford CEO the market may react badly. Shareholders in the Redmond company should watch the CEO race, and they should decide what they can do to insulate their results from a misstep.

Disclosure: Author represents that he has no position in any stocks mentioned in this article at the time this article was submitted.