3 months later, MS may now be firing ~half of the Nokia group. The executives who drove that catastrophic deal stay.
What a testament to how disastrous big M&A really is. Is there any large acquisition that succeeded in the last 10 years? I'd feel sorry if I was a Nokia guy there, they pulled out the best non-Apple phone hardware in the last years.
Probably also a good reminder for Blackberry - dont sell yourself and die trying, it actually can't get worse.
My understanding, primarily from friends at Cisco which has its own history of acquisitions and layoffs is that this is roughly standard procedure, catastrophe or not.
Basically, there's always going to be a lot of overlap when acquiring another large company. Loads of people are made completely redundant and things that didn't come out via diligence are discovered.
There's a wait and see period where some people leave, followed by jockeying for position and finally layoffs of people who remain redundant and/or lacked the awareness to pursue either of the former two options.
Obviously, a merger which doesn't pan out would amplify the effect.
What I wonder is how much such a process actually affects the success of these mergers? Do the consultants and banks who assist in these sort of things have a variable to account the back-biting scramble that will take place in each first year?
'Cisco figured out that mergers between similar sized companies rarely work, as there are frequently struggles about which team will control the combined entity.'
I recall asking people there about why they didn't acquire certain companies that I thought would make a lot of sense from a technical / product perspective.
The typical answer was right in line with that quote - that Cisco stays away bigger companies that others might try to swallow at high cost.
That they look for logical acquisitions of specific products in the few hundred million dollar range, not billions.
Sure it is, there just happen to be exceptions.
Of the 21 years and 136 Cisco acquisitions with prices on Wikipedia, 14 come in over $1B. The average price overall is $530M, and the average price excluding >$1B deals with $178M.
I would be very surprised to discover that Google has acquired close to as many headcount as Cisco has. But I don't want to do the research work either. :)
In 2012 Google acquired Motorola Mobility with it's 20,000 employees.
Google just bought out the patents of Motorola and dumped the company away to Lenovo afterwards. There was no merging, no redundant employee elimination process, like in other mergers.
Plus, this number is obviously a large outlier. An actual stats person would just go calculate the figures with the outlier removed- Cisco probably made much larger acquisitions, employee count-wise, than Google in that case.
Given the context, I guess it's some kind of product development order?
It's a document that's usually produced by a product management group in a company that outlines (very vague, almost laughably so) the "market requirements" - what users will want/need - for a given feature or set of features.
This is usually handed to developers/designers to come up with a "High Level Design" (HLD) that gives the "how" to the MRD's "what".
It's usually only seen in larger software companies.
Cisco is an engine for buying up small companies, digesting them, and extracting value from their products. It does not really do engineering or create its own product lines. As a result, it has polished the process of buying up companies, and progressively shutting them down while extracting the maximum sales value from the products that company has developed.
The key thing is that this is the core model of Cisco's entire business. It's actually not too rough on the people involved - the profits of the milking machine are shared fairly generously with the people being milked - but it is all about purchasing products with "potential future value" and converting it into cash, not creating new value.
Even if you are a high performer, being part of the now-controlled interest deals you something of the short stick, as they say.
If your company is acquired, be prepared to move on. Regardless of personal performance, they may give you no choice.
You might have the wrong criteria for acquisition success. I'm sure both Nokia and MS knew these layoffs would come before they agreed to the purchase.
I would think if I worked at Nokia and we were acquired by Microsoft, I'd probably be looking for another job fairly quickly. Considering the writing was on the wall for a while even before they were acquired by MS.
Those who stuck around through the merger and take take the first-round cuts offer will likely make out pretty well. Unfortunately for Microsoft, this means that they're largely paying for people with good strategic skills and a high capacity to find work elsewhere to leave.
It's the ones who stay put, largely out of lack of strategic skills and/or alternative options, who are going to be less valuable to the company. There may be further incentives but they're likely to not be as generous.
Or so say the rational expectations theorists.
It may be successful on a tax/accounting perspective since the purchase was made in € with cash that couldn't be brought to the US.
Yet this does look like a gigantic waste of assets. Warren Buffett says that a successful business is all about mindfully allocating its resources. This looks like the oppsite - no wonder that Nadella has a hard time explaining what happens in simple words.
Yes, many. Think of the Lenovo-IBM deal -- massive success. The Facebook-Whatsapp deal is 2.5x bigger than this acquisition, we'll see how that works out (financially).
Google-Youtube is a big one that can be considered as a big success as well. Ebay-Paypal. FB-Instagram.
The last three you mentioned are all tiny companies acquired for huge amounts of money.
YouTube had something like 60 people at acquisition -- definitely under 100. Instgram had under 20 I believe. Not sure about Paypal but I'm sure it was dwarfed by Ebay.
There is something to that. I think a smaller number of people can be integrated into a larger one, but when two massive companies like Microsoft and Nokia come together, there is bound to be friction.
Not sure what happened with Google and Motorola, but the companies were I think wisely kept separate, whereas it sounds like Nadella wants more "integration synergies".
These Uber mergers never seem to create any lasting value
I think you're overstating things tremendously here. ThinkPad is alive, and from the reviews I've seen, doing well. http://www.engadget.com/2014/03/28/lenovo-thinkpad-x1-carbon.... Many buyouts end with entire products being canned.
I still have an IBM ThinkPad. They were good quality back then, but I really think the standard-bearer today is MacBook.
New thinkpads are just like every other manufacturer's laptops, even the X line.
Lots. Of course, success is relative to for whom -- many of them work out well for shareholders of the acquired firm, many work out okay for shareholders of the acquiring firm, and the executives on both sides usually do well.
Of course, part of how it works out for those groups is that it, by design, doesn't work out well for the "human resources" that are production inputs.
You buy ailing companies and then cut fat. That's the plan, not evidence of a bad decision.
What was happening to Nokia WITHOUT getting bought and gutted? They were in a tailspin and had major internal friction issues getting good tech to the top of the consumer heap. They would be another Blackberry...
Oh wait, you also suggest Blackberry fight it out with their wet noodle of a product line?
As an employee, when you are acquired, you either are indispensable (and will not be made redundant) or you should probably head for the door so you aren't competing with your coworkers for spots when a flood of you are dumped into the market.
Microsoft got the products, IP, licensing deals and will be keeping a block of very productive employees. This is an obvious move and good for MS, MS shareholders, and, indirectly, consumers.
It should instead be "Microsoft saves half of Nokia's employees jobs."
Unfortunately, some acquisitions are for talent, others for revenue, others for customers, others for technology, or a mix, and the talent here may be a mix bag.
So if you're the selling CEO / board, you get to claim you sold the company whole, and if you're the buyer, you just blame the cuts on the increased efficiencies to be gained from combining the companies - it's a sign that the deal is "successful" and you're achieving the synergies you modeled before the purchase.
Businesses are never unprofitable because they have too many employees.
Businesses are unprofitable when management lacks the skills, the foresight, or the vision to make those employees profitable.
Edit: If this isn't obvious consider what a world-class entrepreneur could do with 12,000 experienced employees, a couple of billion in severance savings, and a kick-ass idea.
This is not a random question; this company exists.
Actually, I would say that by the time the deal rolled around the catastrophe had already played itself out at Nokia. It's sad what happened to Nokia, but the acquisition is the least of it.
edit: clarifying language
They have almost no marketshare in the US. So is it really the best non-Apple hardware, or does being the best not really even matter?
Subject: Starting to Evolve Our Organization and Culture
Body: Last week in my email to you I synthesized our strategic direction ...
I'd be curious to see other people's management style from their armchair.
I used to believe that if one were selective, he could find discerning groups of people where political shenanigans were of minimal effect. I've since learned that no matter what, politics is a matter of survival in any group of 5+ people, especially in cultural circumstances that emphasize individual independence and freedom.
We can't fault a corporate CEO for donning highly-sanitized corporate political speech. Like it or not, executives would be dead meat without it.
Heck, Cheney all but quoted Reagan's "I don't recall"-defense as a 20th anniversary tribute and that had been lampooned specifically.
Lies don't have to "sound political" to be untrue.
For our business to continue running, we must reduce the number of staff. This is an unfortunate but also inevitable reality.
[insert details of layoff here]
[insert honest platitudes]
Senior management wishes all of you the best of luck, and has every confidence that you will be even more successful at your next job.
Last year, Microsoft made over $20 billion profit on almost $80 billion in revenue. The truth is that Microsoft has accumulated many useless employees over the years, and they could be even more profitable by laying off those people.
Pruning all the carefully hidden useless employees is a massive effort, getting rid of a department that is longer relevant is a minor effort. Expecting them to undertake the massive effort for the appearance of fairness is unrealistic.
it seems fine to me?
Subject: good news and bad news
Hey team, got some good news and bad news. The bad news is not everyone can be part of some of the current transitions, you're more than welcome to re-apply to new positions that will be evolving in the future, for those of you who are still relevant. The good news is that for those of you who are staying - Microsoft is now a mobile-first company! We're making the productivity equivalent of Angry Birds. Also, we're keeping xbox, you guys are cool.
This is a notification that it's happening, that you're not going to be affected, and that they're doing it because they think it will help the company grow and adapt.
Though it's advice aimed at much much smaller companies than Microsoft it still resonates. Also I bet HN readers are much more likely to have to one day lay off 18 people than 18,000.
For starters, I would not use the word "synthesized" in my email.
Last week in my email to you I outlined our direction as a productivity and platform company. On July 22, during our public earnings call, I’ll share further specifics on where we are focusing our innovation investments. The first step to building the right organization is to make changes to our workforce. With this in mind, we will begin to reduce the size of our overall workforce by up to 18,000 jobs in the next year. Of that total, Nokia Devices and Services is expected to account for about 12,500 jobs, comprising both professional and factory workers. We are moving now to start reducing the first 13,000 positions, and the vast majority of employees whose jobs will be eliminated will be notified over the next six months.
It’s important to note that while we are eliminating roles in some areas, we are adding roles in certain other strategic areas. My promise to you is that we will go through this process in the most thoughtful and transparent way possible. We will offer severance to all employees impacted by these changes, as well as job transition help in many locations, and everyone can expect to be treated with the respect they deserve for their contributions to this company.
Later today your Senior Leadership Team member will share more on what to expect in your organization. Our workforce reductions are mainly driven by two outcomes: work simplification as well as Nokia Devices and Services integration.
First, we will simplify the way we work to drive greater accountability and move faster. We plan to have fewer layers of management, both top down and sideways, to accelerate the flow of information and decision making. This includes flattening organizations and increasing the span of control of people managers. Our business processes and support models will be more lean and efficient with greater trust between teams. These changes will affect both the Microsoft workforce and our vendor staff.
Second, we are working to integrate the Nokia Devices and Services teams into Microsoft, completing the acquisition announced last September. To win in the higher price tiers with our first-party phone portfolio, we will focus on design and technical innovation. In addition, we plan to shift select Nokia X product designs to become Lumia products running Windows. This builds on our success in the affordable smartphone space and aligns with our focus on Windows Universal Apps.
Making these decisions to change are difficult, but necessary. I want to invite you to my monthly Q&A event tomorrow. I hope you can join, and I hope you will ask any question that’s on your mind.
I do like the line about "the respect they deserve" without qualifier. It adds a bit of humanity to the whole thing.
But not enough overall IMO. It really leaves me with the impression that this is just typical corporate speak trying to put the stock price ahead of the mentions of "design and technical innovation".
With an acquisition of this size there are going to be redundant people, and as Nokia was headed towards going out of business, everyone would have lost their job instead of just half.
I think it's pretty tone deaf in a letter to employees. But tomato/tomato I guess.
I didn't say anything about keeping redundant positions, just that he wants to raise the bar for results, and I feel like this release only hurts that effort.
I'm not aware of any great turnarounds that began with "look, we're here for the share-holders". (I'm sure for good or ill they're out there, but they haven't come to my attention for whatever reason).
It's just about the exact opposite of other famous turnarounds based on the "it's the product stupid".
I don't know... I just feel like there's a lost opportunity here. Morale is going to suffer regardless. That doesn't mean you have to make it worse by being tone-deaf.
It can be a disgusting read, but everybody does that in a situation like this -- with a reason.
This guy is trying too hard to sound smart. Everything that's written by him reads like a try-hard freshman English major.
Its a way of softening the blow for the people being laid off. I mean, sure, you are losing your job, on the other hand, do you really want to work for someone whose brain works in a way that would let them write "Last week in my email to you I synthesized our strategic direction"?
It's much easier to retreat behind MBA speak, especially when you don't have a clear grasp of what you're trying to communicate or are saying things you don't want to be heard saying. "If you can't dazzle them with brilliance, baffle them with bullshit".
It CAN be a useful tool to deflect and confuse, but sadly I think 99% of the time it's not used intentionally. It's simply much, much harder to communicate complex ideas in a simple and clear way - it takes a lot more effort and deeper understanding, and many people are simply incapable.
I know an MBA right now who is pursuing a business wherein he offers wifi hotspots to small businesses. His literature claims that renting one of his hotspots will make the business "PCI compliant". I've personally advised him on multiple occasions (gently at first, growing more stern over time) that this claim is patently ridiculous and only displays his incompetence to anyone knowledgeable in IT, but he refuses to amend his materials or statements. Just the tip of the iceberg with him.
Granted these are anecdotes, but I think they embody the anti-MBA ethos. Qualified persons strongly dislike MBAs because MBAs often feel their MBA grants them immunity from doing things incorrectly, and that they are instantly authorities on everything without requiring any experience or research.
I swear they have to explicitly teach that in business school, like: "Now, this degree grants you the magic power of never needing advice, information, or training, and you will always be right, and normal people won't understand that because they didn't go to business school... but remember, business school is the only school that matters. No one would have money without us! Just tell the nerds to shove it if they try to tell you anything else." It's far too universal a feeling among MBAs to be coincidental.
Fully agree that YMMV, but generalizations are useful tools as long as we don't take them as absolutes.
Uhh... who said that MBAs didn't "get it"? The original accusation was that MBAs sometimes employed a particularly objectionable type of vapid and duplicitous speech, not that MBAs were lacking in any particular mental department.
I see several people trying to extend an olive branch ("my personal experience coincides with the stereotype BUT I know my experience is limited, please fill in the gaps"). Instead of filling in the gaps, which you are presumably able to do
> I've just worked with people who were both gifted and in possession of an MBA.
, you insult the people asking you for information and you ignore their polite request. WTF, mate?
In any case, MBAs can help start-up focused entrepreneurs. They can be start-up focused entrepreneurs. Your perception that it can't be so is exactly what I'm talking about.
One of the most obvious indicators of this is people who retreat behind the bulshit bingo, which is why it is so rightfully disparaged. Seriously, 'synthesized'?? That word doesn't mean what he thinks it does, unless he literally made up their strategic direction on the spot, in that email.
CEOs and other leaders need to consider their audience. Anyone who casts a company-wide memo to a technical audience in such terms comes off as hopelessly out-of-touch, and deserving of scorn.
As soon as the majority of MBAs start displaying a moderate amount of domain specific knowledge that makes them look less like complete fools to the petty peasants that work for them, I'm sure the hate will fade.
I could see him being Graded cat 4 "in need of improvement" and put on a PIP in one company for that less than stellar performance.
Even CEOs need to feel like a cog in a machine sometimes...
At the very least he could've added a thankyou for your hard work, or an apology to those that no longer have a job.
Innovation investments? That's a new one! Made me laugh, but not for the right reason!
Why can't they wait and make the announcement once they know who they will eliminate and do it in one swift action? Why put people in limbo for a year?
My only gripe is that the layoffs are not larger - we need about 20% of the marketing folks and 20% of the program managers that we currently have. I would cut deeply in those disciplines as well and then Page-style cut all of the deadwood non-strategic low-revenue projects (and there are a lot of them).
Laying off Terry Myerson (Windows) and Kevin Turner (chief hacker culture killer) would be a great improvement as well - they are both cancers.
For example. We got acquired. New companies decides we need to cut some of our staff. They get rid of a co-worker who is solely responsible for training companies to work with our product. His pay was way under market anyway so they didn't save much letting him go. Then he goes and gets a job making double with better benefits doing training. Then a few weeks later our group is scrambling to find someone, anyone, capable of delivering customer training....
Was Terry responsible for the compartmentalisation of Exchange to permit it to spread across different machines, each with different roles? Good idea but I found 2010 bloated compared to 2003, I skipped 2008 (and NOBODY tested 2010 SP2 did they???? That bust everything for me, and on an Exchange instance on one machine only; I can only imagine how it was for spread installations).
Are there really that many little projects? How big is the Office team?
Kevin's management style is to give everyone a scorecard, Walmart Style, on metrics like "top apps achieved" or "total apps achieved" that drives all sorts of terrible behaviors in our field organizations working with developers. This is why we have a Kindle application on Windows Phone that is terrible quality. Nobody has any incentive to help Amazon make it great because its not on the scorecard.
The rest we should release.
Or am I wrong? Has that changed?
I used to work in a larger team in a different company but we only had 1 PM who frustrated us all, sadly. How do they balance 3 PMs? Do they argue between themselves?
Actually, I'll be shocked if 10% of Marketing go.
What you're forgetting is those are the people that are best at justifying their own existence.
Sure, yes, they could come up with a master list and just pull the trigger today. But the odds of sweeping up a huge number of "false positives" grow considerably.
The idea behind waiting is that along with these layoffs are a lot of restructuring work - teams get moved around, some people actually get promoted, newly manager-less teams are absorbed by another team, etc.
When that happens, there will be a certain number of people who might have been underperforming that start to thrive, possibly because of having a better manager, or because they're more interested in their new group, etc. Other people who might have been coasting by and taking up space but getting decent reviews might suddenly be under a better manager and have no where to hide.
But basically, you can do layoffs, restructure, and then in 6 months time re-evaluate.
Typically, barring one-off events, they'll do several rounds here, a few months apart. Done properly, it won't be an every day worry, it'll be a concern 2-3 times over the next year.
It's easy to say from the outside that the layoffs will hit underperformers and people who are just coasting, but the fact is that layoffs of this scale inevitably involve politics. We're talking about an organization that had so much trouble getting the Office people on the same page as the Mobile people that they launched a make-or-break product (Surface) with a buggy beta version of its killer feature (Office). You think that organizational dysfunction won't extend to the restructuring process itself?
At least if you do them and get them done quickly, the people you want to keep know where they stand.
No -- most people who work at a big company know _exactly_ whether they're in danger or not. We're speaking about 5% of the original (pre-Nokia acquisition) workforce. You must know whether you're in the bottom 5%, or if your product is in the least critical 5%. Of course there are surprises and some good/productive guys will be laid off because of politics (as the process is not completely effective), but in general that's not the case.
I've seen similar things happening inside the financial industry around 2008. Many people left (sometimes much more than 5%), but we could usually guess who's going to be affected (with really high accuracy).
Sometimes. I used to work at RIM (BlackBerry) and they announced huge layoffs for August 2012. I knew at that time that my whole team was gone. The rest of the team just talked about how valuable they were and how no one could do the job we were doing. I think they honestly thought that. A lot of people have a tendency to over-value their work and roles.
I think most people are shitty at it on either side. You can be great at your work and role and still get the axe. Management doesn't often take that into consideration.
When it's not whole teams, it's generally managers being told they're losing N reports but they can choose which N. Then, effectiveness at one's role is at least part of the equation.
Generally a company making big layoffs is a sign of a sinking ship. If you are a hot programmer you aren't going to want to hang around waiting for doom. Much better to move to an expanding and thriving company.
In the brave new world of "mobile first, cloud first" what's the least critical 5%? In a "mobile first, cloud first" world, somehow the newly-acquired mobile division is getting the brunt of the cuts.
I was a Zynga until last June, when the shut down their whole Shared Tech Group (basically the core Tech Support for all Teams / Server Management, Engine Development etc.) overnight, the whole group always had the feeling they would not be in danger because after all, pretty much everyone was dependent upon them. Until management thought otherwise, they announced "some cuts" at the Company Meeting, which was on Friday the next Monday we held the severance agreements in our hands and were instructed to leave the office.
You never really know what management is planning unless you know someone up their or are part of it.
Also, I disagree with your assumption that it's easy to know if you're in the bottom 5% of performers. Of course you will have a general idea of where you stand, but in a company the size of Microsoft with considerable organization dysfunction I really doubt anybody can judge themselves with that sort of granularity.
It's even less true when you are talking about merger layoffs. Even if you are good, the Nokia guy might be better.
or people can get re-hired on as v- contractors or moved to other parts within the company.
It's not like other MS employees haven't left and started their own firms using MS technologies.
Besides, I fail to the see the logic that advance warning isn't objectively good. If you're going to be laid off it's better to have some additional time on the job before your severance, even if there's uncertainty. And besides, how much peace of mind did employees at Microsoft have anyway? If they were paying any attention at all to how the company is doing everyone at the company had to see that layoffs and restructuring were inevitable sooner or later anyway.
Yep, I'm sure they'll save a lot in severance when their best people quit.
Look into co-determination in Finland for an example. Finland of course is also a big part of the news from Microsoft today.
Getting rid of dead wood is a great idea. Tons of middle management there, just sitting for years and causing obstructive damage.
He explained that any company who could shed a massive amount of its workforce within a year, or all at once, is a red flag for massive internal problems. At the time we had this discussion, he was the CFO of a company that had over 30,000 employees globally.
His thinking was that the same principals that small companies use (not hiring too quickly, etc.) should be scaled up regardless of the company size. You either need people or you don't. You don't hire too fast simply because you are experiencing rapid revenue growth, because revenues do not grow unabated. You hire as slowly as you can, so that when recessions hit or market forces change, you don't suddenly have 3 or 4 times the staff you need. His thinking (which I agree with) is that since those people worked extra hard to cover the work when times were booming, you don't turn around and lay them off just because things slow for a couple of years.
Those people worked hard for the company because they are good employees; he saw it as more important to have good employees on hand when things ramped up again rather than just cut them loose and hope he could get more good employees later.
Since that discussion, he's gone on to two more companies, leading one through an IPO as the CEO. All of his companies have operated like gangbusters - he comes in, revenues go through the roof, debt gets paid down and he's NEVER LAID ANYONE OFF. In the meantime, in his work history, he's been through 3 IPOS (two as CFO, one as CEO) and I don't know how much he made personally on each I do know that he cleared $41 million in a single day on one of them.
This is in complete opposition to what I've heard from several other CEOs, who tell me 'labor is your most controllable expense'. Yet, none of their companies (some also on the NYSE or NASDAQ) have performed anywhere near what my friend's has.
I think he's right. Wall Street is full of guys who have no actual experience running a business. They see layoffs as 'cleaning house' and 'cutting expenses' but the reality is that while that can be true, it more often is a harbinger that the company is not well run.
While it sounds like your friend definitely knows how to run a real business, he/you may want to re-asses Wall Street's real business: it isn't "running companies", it isn't "building value" and it sure isn't "giving away solid analysis for free".
They make money off trade-activity that generates short-term returns.
The sell trades, not stocks. Not unlike eBay. They can and do profit from irrational/emotional behavior and they have no qualms about designing their business to fuel and leverage those behaviors for increased returns.
If 2007 taught us anything, it should be that Wall Street is more than happy to tell you whatever you need to hear to generate predictable trades -- more than happy to tell business news channels whatever will generate predictable trades -- even those they know those trades to be bad and foolish to the extent that they personally bet against them.
Counter Nadella's communications over the last few weeks with what Larry Page said/wrote when he took over from Eric Schmidt. Even though Google pursues hundreds of interesting initiatives of varying revenue importance, it appears they have a coherent strategy (internally, at least) and have been making appropriate decisions to further it, even when those decisions are sometimes indecipherable to external viewers.
Regarding the "tons of middle managers" (another dehumanizing expression imo.) - I haven't met anyone just "sitting for years" and happily "causing obstructive damage" yet. I have however met quite a few where it took me some time to appreciate their work (looked like nothing/trivial from the outside) and realize their failed struggle with organizatorial constraints on their work.
Apologies if I am reading too much into your post. However, there seems to be pervasive contempt for the people affected by layoffs in threads like these that's unnecessary and unwarranted.
- There is dead wood. People who do negative work, or who do not add value, only process, to shipping products
- There are toxic middle-to-upper level managers. These people exist; I have personal experience with one who I believe is an actual psychopath
- There are many partner-level people who have essentially reduced their careers to manipulation of other people's careers, by canceling products, or getting people canned or quashing promotions, or backing poor promotions.
I don't think it's hyperbole to say that middle management at Microsoft is riddled with "dead wood".
I had a guy under me laid off, and I resigned on the spot -- because his being laid off meant the company was giving up on a core capability that was the main reason I wanted to be at the company. A friend of mine was working at a large software company that laid off "dead wood" (according to management) including key engineers, which literally led to all the other experienced engineers on his team leaving.
how do you know it's middle management?
> Getting rid of dead wood
That's such a despicable way to talk about human beings,but not surprising here,unfortunatly.
Nobody is implying the people who hold those jobs have any personal failings or aren't capable of doing productive work, but the jobs themselves are not helping the business.
"We need to cascade memos about our holistic logistical matrix approaches."
In every post about this story, right near the top have been dreamy posts about "dead weight" and "middle management" being cut, as if all of Microsoft's prior executive bungles are suddenly being resolved (with most of the same executives, as an aside). Yet the bulk of the layoffs come from Nokia (man, Finland is going to be pissed), people whose only mistake was following a leader who was widely considered a trojan horse.
Elop keeps his job. Those people lose theirs.
And how ridiculous prejudicial for all of these people whose only mistake was being in a company that main horrendous strategy decisions time and time again -- having people title you "dead wood".
I often hear 1-3 months of employment and or pay over the time, giving hopefully adequate time to prepare.
Keeping it secret is a lost cause. There would be rumors and theories and half truths flying around.
>focusing our innovation investments
>our work toward synergies and strategic alignment
>Nokia Devices and Services integration synergies and strategic alignment
>simplify the way we work to drive greater accountability, become more agile and move faster
>Thank you for your support as we start to take steps forward in evolving our organization and culture
You can't make this shit up. It's straight out of Dilbert.
Unbelievable how "We have decided our business requires 18000 less employees than there are now" can be strategically and synergetically rephrased and aligned.
Culture, ah, culture.
> The first step to building the right organization for our ambitions is to realign our workforce. With this in mind, we will begin to reduce the size of our overall workforce by up to 18,000 jobs in the next year. Of that total, our work toward synergies and strategic alignment on Nokia Devices and Services is expected to account for about 12,500 jobs, comprising both professional and factory workers. We are moving now to start reducing the first 13,000 positions, and the vast majority of employees whose jobs will be eliminated will be notified over the next six months.
That says '18000 job cuts' pretty clearly to me.
The rest is general high-level direction because 1. that's probably the only thing they have right now, it takes time to work out detailed restructuring, 2. that's the level at which high level managers operate - fuzzy strategic directives, up to lower-level management to implement them in specific ways.
- Nokia X is dead
- other Devices departments are not affected/the effect is limited
This is the THIRD round of major layoffs Nokia has gone through since 2011. I feel bad for my former colleagues.
All an academic point since now they're just going to be "the phones division"
In that particular case, which may or may not have any similarity to this incident, layoffs were determined in 2 ways
A) if you had 2 redundant or similar operational centers you got rid of the most expensive one unless there was some compelling reason not to (huge client demanded they stay, or they were more expensive but dramatically more efficient)
B) technology centers the goal was to integrate what had to be integrated as fast as possible. 80% of the time this meant literally telling people they wouldn't have the same functionality after the acquisition and getting rid of the entire support team. Occasionally, you would find some piece of technology that was great and easily integrated into the rest of the systems and that support team would be given good terms to stay until that was done. Very rarely you would find some piece of technology that was newly vital and hard to integrate, in that case you'd keep a skeleton crew to keep it operational, but you knew that it wasn't going to get any new resources and if it ever become non-vital that team was gone as well.
For point A) above, I've literally seen the decision come down to the cost per square foot of the office space. I've never been in a situation where they had a predetermined number they had to get to though. The number was a natural calculation based on the above.
How much PHP do they need to write each?
Good old corporatespeak. Anaesthetize them with tedious bullshit so you never have to say "You're fired."
This created a lot of redundant people and groups.
Uh, no, being capable of designing things cooperatively rather than playing political games and supporting status-quo is what makes you agile. Products that sell are the effect, not the cause.
It's much easier with a smaller company, though I doubt that's the primary motivation for the layoffs. More likely, they want to re-evaluate their internal culture, fire people most out of sync with what they'd like the culture to be and hire people that are more similar.
you can't tell me there are not some seriously good staff among that 18,000. Microsoft are a huge company, and very few are more successful than them. Microsoft have the environment to allow things to flourish. IMHO Microsoft are still ahead of the curve and agile, especially with Azure. Microsoft are massive ultimately because what they have done to date has been hugely successful. So its really a case of consuming Nokia.
I think that's why "agile development" involves the use of small teams instead of giant departments.
In large company, you can be gone at any time.
So, the lesson here is: prepare to be gone, and be gone before you are gone.
This has to be part of a multi-year effort to reformat the company. I would expect that there are going to be soft costs that have multi-year impacts. People left behind having to take on more work without necessarily any incentive.
With numbers this high, there will be some degree of randomness in the people selected for the layoff. This will have long-term impacts on morale.
Microsoft has a ton of cash, right? Wouldn't it be smart for them to, once the layoffs are over, incent people to perform in the "new culture"? Give their key people more $, more responsibility, etc.?
At least on concrete and positive note in his email. Wondering if that tripled the initial estimate of 6k cuts.
I dont wish it to happen to anyone. Being laid off is never "good news".