Microsoft sheds thousands of employees

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This was published 6 years ago

Microsoft sheds thousands of employees

By Matt Day
Updated

Microsoft has started the process of laying off thousands of employees, cuts that fall largely on the technology giant's sales force.

The layoffs, anticipated widely since word of the plans leaked last week, come as Microsoft reconfigures its massive sales organisation to focus on its cloud-computing products and sales to specific industries.

Microsoft is dropping many sales people as it pushes further into cloud services.

Microsoft is dropping many sales people as it pushes further into cloud services.Credit: AP

The cuts are expected to total thousands of workers, the company said, without giving specifics. The vast majority of the affected employees are located outside the United States.

Layoffs will also fall on some groups that had supported sales staff, including Microsoft's IT department, finance, and the corporate, external, and legal affairs department, according to a person briefed on the cuts.

Reorganisations, often including layoffs, are an annual occurrence as Microsoft's fiscal calendar flips to a new year at the beginning of July. Microsoft started its new fiscal year on Monday with a 1500-word memo that business sales chief Judson Althoff sent to Microsoft's sales and marketing employees.

Layoffs weren't mentioned, but the memo — also signed by global sales subsidiary chief Jean-Philippe Courtois and chief marketing officer Chris Capossela — said sales employees will be required to "operate in new ways." The email detailed a range of changes to the organisation of Microsoft's sales groups aimed at simplifying the company's sales teams. Before the cuts, about 50,000 — or 40 percent — of Microsoft's approximately 121,500 employees worked in sales.

That sales group was cobbled together during the decade in which Microsoft grew into a dominant player in business software by selling out-of-the-box software licenses and was led by former longtime chief operating officer Kevin Turner, who left the company last year.

As the company in recent years has pushed to sell more of its on-demand computing power, data storage and software services, Microsoft has tried to boost the technical expertise of its sales staff as it cut roles seen as redundant or no longer necessary. That has led to some hiring even as Microsoft shed jobs.

The Seattle Times

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