Lu, who reports directly to CEO Steve Ballmer, will be the highest-ranking Chinese American in the history of the 95,000-employee company when he begins Jan. 5. He will presumably join the company's 18-person senior leadership team, 17 of whom are white.

Nelson Dong, partner at law firm Dorsey & Whitney in Seattle, said Lu's appointment is significant for several reasons.

"More and more Chinese Americans are moving through the historic 'glass ceiling' that held them to purely technical positions in the past," said Dong, who focuses on technology and Asian law, in an e-mail.

"Like Dr. Lu, they are moving up in more corporations today to take major leadership roles across all parts of companies, using and relying on their technical skills but no longer being limited to purely technical roles. Dr. Lu is assuming a position of major strategic and business importance to Microsoft."

As president of the Online Services Group, Lu will head Microsoft's Internet search and advertising efforts -- the critical fronts in the company's battle with Google. He led search and advertising engineering at Yahoo until August.

Dong, who is on the board of the Washington State China Relations Council in Seattle and the National Committee on U.S.-China Relations in New York, said Lu's selection has broader implications for corporations seeking talented engineers and executives.

"[T]op companies of the world must be prepared to have diverse management if they truly aspire to have a global impact," Dong said. "China is a natural talent pool today, producing some 300,000 new engineers annually, and so it is fitting that Microsoft will now have such a senior leader who is fully representative of that enormous reservoir of technical abilities."

Wang said members of CHIME were buzzing Thursday after an early report named Lu for the job. Ballmer confirmed the news internally later that day.

"Personally I was very excited when I saw Steve's e-mail, and I believe a lot of Chinese and Asian employees here in the company share the same excitement," she said.

I'd be interested to hear other peoples' reactions to Lu's appointment. Feel free to add your comments on this post or on the story itself, here.