Microsoft looks set to lay off a significant number of employees across the world, in a bid to reorganise its sales force. An anonymous source told TechCrunch that Microsoft is poised to cut “thousands” of staff across the globe. These changes are expected to be announced later this week.
These restructuring efforts are reported to include an organisational merger involving the company’s enterprise customer unit and its SME-focused divisions. Bloomberg and the Seattle Times suggest that Microsoft’s restructuring is a bid to increase the emphasis on cloud services within the sales teams across the world.
Bloomberg has stated that the redundancies will be “some of the most significant in the sales force in years”.
In June 2015, Microsoft announced it would be cutting 7,400 people in 2016, mainly in the company’s phone hardware business. Furthermore, a filing from July 28 2016 stated that: “In addition to the elimination of 1,850 positions that were announced in May 2016, approximately 2,850 roles globally will be reduced during the year as an extension of the earlier plan, and these actions are expected to be completed by the end of fiscal year 2017.”
The timing of these restructuring changes falling in July is in line with Microsoft’s history of announcing employee reductions during the end of the fiscal year.
Microsoft executives Judson Althoff and Jean-Philippe Courtois took charge of Microsoft’s sales and marketing divisions following the exit of long-serving COO Kevin Turner in 2016. Althoff has been critical of previous sales approaches. In a 2016 interview with the Seattle Times, Althoff stated that the company’s cloud had become “a bit of an anchor tenant” for his sales force, signifying a change in Microsoft sales strategy.