Microsoft Looks to Cut Up to 18,000 Jobs

MSFT pre-market at $45 at the moment -- higher than anytime in the last decade. There are big expectations towards Nadella -- we need to see groundbreaking strategy changes to justify this. Exciting times.

I'm not sure how this fits into a big strategy change. It mostly seems like really eliminating redundancy, that's why most of the firings are in the Nokia department. They've recently acquired that, so there are bound to be lots of people there that do jobs that were already filled at Microsoft. That would be more than enough to justify it, at least to stockholders.

Ouch...

It's actually an attempt to try to be smart about letting people go.

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.

I'm not very impressed with the choice of Nadella so far, he seems too deep into MS culture to be able to see clearly. But only time will tell, it's still to early to give a verdict.