No matter which side of the fence you pitch your tent, there's a very real human side to the actions taken yesterday by Microsoft executive management.
Yesterday, the news spread like wildfire that Satya Nadella and his Senior Leadership Team was planning to cut 13,000 jobs immediately, with a total of 18,000 over the next fiscal year. Most of those cuts are coming from among those strung along from the Nokia Services and Devices acquisition. Stephen Elop, Executive Vice President of the unit, took to email to explain where those Nokia cuts would take place, naming reductions and eliminations in manufacturing and engineering.
If you do the math, that means that job cuts in Redmond would need to be made to hit the initial target, and an additional 5,000 job cuts left to make in the next year. Sources tell me that those cuts will actually be made in the next 6 months.
Like a Band-Aid – rip it off!
Investors and analysts are praising Satya's actions, stating he's finally putting his stamp on the company. Stock price is rising. In many industry areas where Microsoft has been blasted at every turn for the last decade, it seems the company can no longer do any wrong, despite not providing clear direction on anything other than "Cloud." Yes, Microsoft needed to make cuts, and the company will most likely benefit from it. But, there's another side to this that I believe is getting lost. 18,000 actual people will be affected by the measure, and some severely. I have many good friends in the halls of Redmond, some of which received pink slips yesterday.
Many ex-Microsoft employees saw this coming and left months ago. But, the majority stayed the course, and those that remain in Redmond today after yesterday's substantial cut, are worried. The next 6 months will be tough.
According to the Business Insider, middle management could see the most sweeping cuts over the next few months. According to the article, Satya has put everyone on notice for the next 6 months as leadership determines where the additional 5,000 cuts will come. Satya's recent email shows that he continues to believe that cutting middle management is the best way to flatten a hierarchy that is wrought with inefficiencies.
Here's some things I've heard from sources:
If employed for more than 6 years, layoff victims will received half a year salary and outstanding stock will be immediately vested. Health coverage will continue through the 6 months, and for every 6 months worked at Microsoft, will receive one week's pay.
Redmond has laid off 1,351 employees immediately, with the effective termination date of September 15, 2014. This allows employees time to utilize Microsoft resources to fix up resumes and get interview coaching. However, some employees have been asked to turn in badges and terminate email by 5pm on Sunday. According to sources, these employees received low scores on their last review. The ones with high marks are being given 6 days.
257 of those immediate layoffs are in the Corporate Services and Marketing group.
Jobs in Cloud related areas are most likely safe, but the Windows client areas are on the chopping block. I know some folks in the Windows client area that did receive their walking papers yesterday. Reported number is around 40%.
About 10% of the documentation teams were already let go.
Yesterday's sweeping cuts to OSG are done, meaning the additional cuts will come in other areas. But, this team took the hardest hits.
Program Managers will affected, but only those who are remote employees. Microsoft seems to be headed back to the "must work in Redmond" mentality (thanks to Terry Myerson), despite building software to enable customers to work remotely.
The layoff process is pretty inhuman. A meeting is called, a script is read, and employees are sent packing.
So, as you can see, there's a very human side to the layoff story. Many individuals and families are affected, and many more to come. Employees who made the cut yesterday, are just as sad for their co-workers as the co-workers themselves. And, because of the cuts, those that remain will be required to take on added responsibilities. Those that were given 6 months will be frantically looking for employment in a job market that is severely sluggish. Redmond and surrounding areas are full of smart start-ups, but there's only so many open jobs to go around.
I really feel for those who have been let go and wish them the best. Many have left the confines of Microsoft and have blossomed. For some, today will be stressful. For others, it will feel liberating. Life does exist after Microsoft.