Microsoft Staff Braced For Headcount Cull – Report

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Microsoft reportedly prepares to reduce its workforce following its acquisition of Nokia’s handset unit

Staff at Microsoft face an uncertain couple of weeks, as yet another report claims that the software giant is preparing to make a large number of redundancies.

The report comes a week after CEO Satya Nadella outlined his vision for the company going forward. In his memo to Redmond staff, Nadella warned that “job responsibilities will evolve.”

Job Cuts?

But now it is reported that Microsoft is planning its largest round of job cuts in five years. The last significant round of job cuts was back in 2009 (just as the global recession was getting into its stride), when Microsoft trimmed 5,000 staff.

But the company’s headcount has swollen dramatically since then, not least because of its acquisition of Nokia’s handset business, which added a further 30,000 staff to Redmond’s workforce. Indeed, Microsoft now has 127,104 employees worldwide, much more than rivals such as Apple and Google. And Microsoft promised at the time it would make $600m (£350m) cost savings in the 18 months after the deal.

Now according to Bloomberg, which cited people with knowledge of the company’s plans, Microsoft intends to imminently wield the headcount axe.

The source indicated that the bulk of the job cuts will be in areas where the Nokia and Microsoft staff overlap, such as marketing and engineering. The report suggests that the Microsoft restructuring may end up being the biggest in company’s history, topping the jobs cuts made in 2009. Some details are still being worked out, two of the people told Bloomberg.

satya nadella microsoft memo square ishCompany Transformation

Last week Nadella outlined his plans to transform Microsoft into a company equipped to deal with a “mobile-first and cloud-first world.”

“Our ambitions are bold and so must be our desire to change and evolve our culture,” he wrote. “Nothing is off the table in how we think about shifting our culture to deliver on this core strategy. Organisations will change. Mergers and acquisitions will occur. Job responsibilities will evolve. New partnerships will be formed. Tired traditions will be questioned. Our priorities will be adjusted. New skills will be built. New ideas will be heard. New hires will be made.”

Nadella promised to reveal more information later this month, when Microsoft pubishes its fiscal fourth-quarter earnings on 22 July.

“I’ve asked each member of the Senior Leadership Team to evaluate opportunities to advance their innovation processes and simplify their operations and how they work,” he wrote. “We will share more on this throughout July.”

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Author: Tom Jowitt
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