Microsoft Corporation is a corporate behemoth in the real sense of the word. In 2015, the firm had 118,000 employees, up from 61,000 employees in 2005. In July 2015, the firm revealed that it planned to lay off about 7.400 people from its workforce as part of a broad restructuring effort. In May, the firm revealed that it was ready to lay off 1,850 workers. Two months ago, Microsoft announced that would ax about 2,850 jobs as part of its cost-cutting strategies. The firm hopes that the job cuts will help it stay lean, nimble, and adaptable to change.
The ax has swung down again and this time hundreds of Microsoft workers in the firm’s London and Redmond offices have lost their jobs. This piece examines the rationale behind the job costs. It would also be nice to see how the job cuts could affect the firm’s bottom line and innovative edge.
Hundreds of Microsoft employees lost their jobs last week
News broke last week that Microsoft was working towards shutting down its Skype offices in London. Redmond is reportedly closing down the Skype unit in London in response to some redundancy engineering positions in Skype and Yammer. The firm says it “made the decision to unify some engineering positions, potentially putting at risk a number of globally focused Skype and Yammer roles.”
Microsoft reportedly axed some 220 jobs in closing the London Skype office and the firm reportedly axed some other 300 jobs in different locations including Redmond in the last week. Of course, the firm provided the usual balderdash on how it would help the workers affected by the job cuts. The firm says, “We are deeply committed to doing everything we can to help those impacted through the process”.
Microsoft’s veteran employees are leaving at an alarming rate
A number of veteran Microsoft employees have started leaving the firm in recent weeks. Some workers are leaving because they don’t feel at home and others are leaving because they figured it was better to leave voluntarily than to get the pink slip. The firm tends to complete its annual review at this time of the year and it normal that some workers will leave after the review. Nonetheless, the fact that veteran workers are leaving in droves raises some red flag.
For instance, Chuck Thacker, who joined the firm in 1998, announced his retirement last week. Thacker was on the founding team of Microsoft’s Surface Pro, he was part of the Xbox/Kinect team; hence, it is strange that he is living at a time when the Surface line is getting the attention it deserves.
Another employee, Bob Kelly has reportedly left the firm that he has called home since 1996. Kelly says he “Can’t wait to finalize my next Phase” and it appears that there is more to his departure. During his time at the firm, Kelly was involved in Security and Private Cloud and he rose to become Corporate VP of Azure Marketing.
Microsoft is a relic of an era long gone and the firm would have gradually faded into oblivion if not for the laser focus of Satya Nadella. The firm might want to do a better job at retaining its top talent in order to avoid a brain drain that could kill its newfound innovative edge.