A personal lament for those who will soon be part of Microsoft's 'cull' -- most of them ex-Nokia employees
By Anand Parthasarathy
Bangalore July 21 2014: Microsoft's announced decision to cull its crop of technologists by 18,000 -- the largest in its history -- attracted shock-horror headlines in India's business newspapers -- but for the wrong reasons.
Let's face it: Signaling a smack of new purpose by announcing a large reduction in the workforce, is almost a rite of passage these days, for new heads of large corporations. They have to show shareholders that they are made of sterner stuff than the ones they replaced. It's not downsizing, stupid! It's called "rightsizing", to use the cynical and cruel euphemism dreamed up corporate communication whizzkids -- another swipe at one's predecessors, an implied hint that things were wrong till the new wonder took over to make things right.
In Microsoft's case, seasoned watchers were already predicting an operation chop-chop, a full week before CEO Satya Nadella sent out his email to staff, at the crack of dawn on July 17, titled "Starting to Evolve our Organization and Culture".
On July 10 he sent out another -- much longer -- mail -- "Starting FY15 - Bold Ambition & Our Core", which spelt out his vision for what he called a "mobile-first and cloud-first world". Those adept at reading between lines, predicted that this vision left unstated some redundant portions of the vision that Satya inherited -- and was clearly about to jetisson.
Last week it became clear that the bulk of pink slips that are to be doled out over the next six months were reserved for ex-Nokia employees -- some 12,500 of the 18,000 -- almost 70 percent. This again is par for the course. When one corporation acquires another, there will be many instances of talent duplication and functional overlap. To the conqueror goes the spoils -- and where two employees are seen to be doing the same job, it is easier to 'let go' the one from the acquired, rather than the acquirer.
The task is made simpler when the titular head of the acquired entity plays His Master's Voice and publicly endorses the cull: in this case Vice President Stephen Elop's own email which makes it clear: . "Our device strategy must reflect Microsoft’s strategy.... (of) making the market for Windows Phone ... by shifting select future Nokia X designs and products to Windows Phone devices"
Let me remind readers that the Nokia X phones, launched as recently as in February in this year, were cheaper handsets running Android, rather than the Windows OS which fuelled the flagship Lumia series of phones. X series phones, of which three were launched in Indi, were affordable smartphones, around Rs 10,000. Now Microsoft's intention to kill Nokia's Android phones and switch them to Windows is out in the open. All those associated in its development and manufacture are probably assured an early place in the departure schedule.
One might think a phone like Nokia X series, targeted at emerging economies markets, might have been developed in India. This does not seem to be the case: the phone has its origins in China, I understand; so we may not see too many ex-Nokia Indian employees of Microsoft, losing their jobs -- at least on this score.
As for redundancies in the manufacturing side, Nokia's India plant in Sriperumbudur is already a right royal mess -- though not through any fault of the company. It is caught in a chakravyuha or maze of bureaucratic regulations that are a legacy of the previous Indian government and to all intents and purposes, the Sriperumbudur manufacturing unit is a closed entity. I have visited the factory -- a beautiful, automated plant which imparted skills and gainful employment to thousands. What a waste of resources! But that is another story.
Nokia may be the prime focus of the staff cuts at Microsoft, but other projects of the parent company -- like the user interface called McLaren and a content creation unit for XBox -- are being talked about as doomed. McLaren, in particular was being watched with great interest by geeks since it promised to equip a future Lumia phone with a combo of gesture and 3D technology. It's still early days to say if this technology will surface in another form.
I think it is worth remembering, finally, that the 12,500 ex-Nokia employees who are due to be unemployed very shortly, represent almost half the strength of the Nokia devices and services divisions that Microsoft acquired for $ 7 billion. Even by the ruthless standards of global corporations, that is very drastic 'rightsizing'.
Companies buy other companies -- and their richest resource -- their human capital -- is the first casualty.