Typically,
when you're a top executive at a major corporation that is laying off more than
10 percent of your workforce, you say a few things to the newly jobless. Like
"sorry." Or "thank you for your many years of service." Or
even "we hate doing this, but it's necessary to help the company
survive."
How bad was
Microsoft honcho Stephen Elop's memo for announcing to his employees that 18,000
are being laid off companywide.
Really,
really bad. It's so bad that I can't even really convey its badness. I just
have to show you.
Here's how
it starts:
Hello there,
Hello
there? Hello there? "Hello there" isn't how you announce
layoffs. Anyway,
carry on. Let's hear the bad news:
Microsoft’s
strategy is focused on productivity and our desire to help people “do more.” As
the Microsoft Devices Group, our role is to light up this strategy for people.
We are the team creating the hardware that showcases the finest of Microsoft’s
digital work and digital life experiences, and we will be the confluence of the
best of Microsoft’s applications, operating systems and cloud services.
Wait, what
does this have to do with layoffs?
To align
with Microsoft’s strategy, we plan to focus our efforts. Given the wide range
of device experiences, we must concentrate on the areas where we can add the
most value. The roots of this company and our future are in productivity and
helping people get things done. Our fundamental focus – for phones, Surface,
for meetings with devices like PPI, Xbox hardware and new areas of innovation
-- is to build on that strength. While our direction in the majority of our
teams is largely unchanging, we have had an opportunity to plan carefully about
the alignment of phones within Microsoft as the transferring Nokia team
continues with its integration process.
Oh, I get
it. This is the warm-up. You're giving me a few minutes to sit down, compose
myself, grab the Kleenex. Now you're going to drop the hammer.
It is
particularly important to recognize that the role of phones within Microsoft is
different than it was within Nokia. Whereas the hardware business of phones
within Nokia was an end unto itself, within Microsoft all our devices are
intended to embody the finest of Microsoft’s digital work and digital life
experiences, while accruing value to Microsoft’s overall strategy. Our device
strategy must reflect Microsoft’s strategy and must be accomplished within an
appropriate financial envelope. Therefore, we plan to make some changes.
"Financial
envelope"? You don't literally keep all of Microsoft's cash in a big
envelope, do you? Anyway, "changes." I know what that's supposed to
mean. Now, please, give it to me straight: tell me I'm fired.
We will
be particularly focused on making the market for Windows Phone. In the near
term, we plan to drive Windows Phone volume by targeting the more affordable
smartphone segments, which are the fastest growing segments of the market, with
Lumia. In addition to the portfolio already planned, we plan to deliver
additional lower-cost Lumia devices by shifting select future Nokia X designs
and products to Windows Phone devices. We expect to make this shift immediately
while continuing to sell and support existing Nokia X products.
To win
in the higher price segments, we will focus on delivering great breakthrough
products in alignment with major milestones ahead from both the Windows team
and the Applications and Services Group. We will ensure that the very best
experiences and scenarios from across the company will be showcased on our
products. We plan to take advantage of innovation from the Windows team, like
Universal Windows Apps, to continue to enrich the Windows application
ecosystem. And in the very lowest price ranges, we plan to run our first phones
business for maximum efficiency with a smaller team.
WTF. Is
this some kind of joke? DO I HAVE A JOB OR NOT?
We
expect these changes to have an impact to our team structure. With our focus,
we plan to consolidate the former Smart Devices and Mobile Phones business
units into one phone business unit that is responsible for all of our phone
efforts. Under the plan, the phone business unit will be led by Jo Harlow with
key members from both the Smart Devices and Mobile Phones teams in the
management team. This team will be responsible for the success of our Lumia
products, the transition of select future Nokia X products to Lumia and for the
ongoing operation of the first phone business
I AM
GNAWING ON MY MOUSE PAD IN ANGER. ALL I WANT TO KNOW IS WHETHER I NEED TO START
SELLING MY PLASMA TO MAKE RENT NEXT MONTH. PLEASE TELL ME THIS BIT OF
INFORMATION.
As part
of the effort, we plan to select the appropriate business model approach for
our sales markets while continuing to offer our products in all markets with a
strong focus on maintaining business continuity. We will determine each market
approach based on local market dynamics, our ability to profitably deliver
local variants, current Lumia momentum and the strategic importance of the
market to Microsoft. This will all be balanced with our overall capability to
invest.
Our
phone engineering efforts are expected to be concentrated in Salo, Finland (for
future, high-end Lumia products) and Tampere, Finland (for more affordable
devices). We plan to develop the supporting technologies in both locations. We
plan to ramp down engineering work in Oulu. While we plan to reduce the
engineering in Beijing and San Diego, both sites will continue to have
supporting roles, including affordable devices in Beijing and supporting
specific US requirements in San Diego. Espoo and Lund are planned to continue
to be focused on application software development.
Blah blah
blah I don't even care anymore. You have numbed me to the afflictions of
mankind with phrases like "business continuity" and "market
dynamics." And now you're probably going to use some crazy euphemism, like
"streamline," to tell me I'm fired. Go ahead.
We plan
to right-size our manufacturing operations to align to the new strategy and
take advantage of integration opportunities. We expect to focus phone
production mainly in Hanoi, with some production to continue in Beijing and
Dongguan. We plan to shift other Microsoft manufacturing and repair operations
to Manaus and Reynosa respectively, and start a phased exit from Komaron,
Hungary.
"Right-size"!
"Phased exit"! Oh, you are so killing this.
In
short, we will focus on driving Lumia volume in the areas where we are already
successful today in order to make the market for Windows Phone. With more
speed, we will build on our success in the affordable smartphone space with new
products offering more differentiation. We’ll focus on acquiring new customers
in the markets where Microsoft’s services and products are most concentrated.
And, we’ll continue building momentum around applications.
Life is
empty. All that remains is dust.
We plan
that this would result in an estimated reduction of 12,500 factory direct and
professional employees over the next year. These decisions are difficult for
the team, and we plan to support departing team members’ with severance
benefits.
There it
is, finally. In paragraph 11. I would react more strongly to the news that I'm
laid off, but my synapses are no longer firing properly. The badness of this
email has rewired my brain's circuitry. All I understand now is business-school
jargon. And death. Sweet death.
More
broadly across the Devices team, we will continue our efforts to bring iconic
tablets to market in ways that complement our OEM partners, power the next
generation of meetings & collaboration devices and thoughtfully expand
Windows with new interaction models. With a set of changes already implemented
earlier this year in these teams, this means there will be limited change for
the Surface, Xbox hardware, PPI/meetings or next generation teams.
We
recognize these planned changes are broad and have very difficult implications
for many of our team members. We will work to provide as much clarity and
information as possible. Today and over the coming weeks leaders across the
organization will hold town halls, host information sharing sessions and
provide more details on the intranet.
Oh, good.
Because if it's one thing I need right now, it's more details.
The team
transferring from Nokia and the teams that have been part of Microsoft have
each experienced a number of remarkable changes these last few years. We operate
in a competitive industry that moves rapidly, and change is necessary. As
difficult as some of our changes are today, this direction deliberately aligns
our work with the cross company efforts that Satya has described in his recent
emails. Collectively, the clarity, focus and alignment across the company, and
the opportunity to deliver the results of that work into the hands of people,
will allow us to increase our success in the future.
Regards,
Stephen
