As the coverage from The Seattle Times indicates, the layoffs began last Thursday after being leaked a week prior. The leak didn't specifically mention layoffs, but it did talk of simplifying the sales teams. The majority of the layoffs will hit Microsoft's sales teams outside of the United States, although some U.S.-based employees will be getting the axe as well. Employees in Legal, I.T., and Finance operating in a support capacity for the sales team are among the likely U.S.-based candidates for this upcoming round of layoffs. Thousands of workers worldwide (out of over 120,000 employees across the globe) are expected to be laid off in the near future.
The sales group for Microsoft was put together in response to increasing sales of software licenses in the last decade. It was led by Chief Operating Officer Kevin Turner who departed the company last year to take a position at Citadel, an investment company based in Chicago. Turner was a part of the Microsoft team for over a decade and was seen as a likely candidate for replacing retiring CEO Steve Ballmer, a position that was eventually filled by CEO Satya Nadella.
Microsoft's fiscal year ends in July and layoffs typically happen around this time along with reorganization of the company's practices or shifting of priorities. At the moment, it seems that efficiency will be the overall goal as the way Microsoft has been conducting business has shifted from selling software licenses to on-demand services based on cloud computing. Prior to last week's memo, approximately 40% of the company's staff worked in sales.
What do you think of Microsoft laying off thousands of employees outside of the United States? Do you think that this is an indication that the company is in some sort of financial difficulty or are they simply trimming the fat? Let us know in the comments below!