Microsoft has announced the biggest layoffs ever in its history. The major changes follow after a recent memo from Microsoft CEO Satya Nadella who stated that “Nothing is off the table in how we think about shifting our culture to deliver on this core strategy.” That being said, a restructuring plan to simplify its organization and align the recently acquired Nokia Devices and Services business with the company’s overall strategy has now been set in place. These steps will result in the elimination of up to 18,000 positions over the next year. Of the total, about 12,500 professional and factory positions will be eliminated through synergies and strategic alignment of the Nokia Devices and Services business acquired by Microsoft on April 25.
“First, we will obsess over our customers.”
Given that Microsoft has wavered in terms of success in recent years shifting from its declining PC software business to its mobile platform, Satya Nadella has taken on the position with a view to reshape what Microsoft is and what it does at the core. Nadella, now plans to focus the business from a “devices and services” company to focusing on the cloud and and mobile. Their layoffs are the biggest following their last major restricting in 2009 where 5,800 jobs were cut off. Nadella promised that those affected by the layoffs will be notified during the process in the next six months and earn severance and transition assistance until June next year when the cuts complete. “We plan to have fewer layers of management, both top down and sideways, to accelerate the flow of information and decision making.” In what appears to be trimming the fat, it looks that Nadella is taking steps to make Microsoft more competitive in the space that’s being dominated by Google and Apple.
Nokia X Android designs and products to run Windows Phone
In a separate email to staff, Stephen Elop has told employees that Nokia X devices will no longer run on Android. “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.” Elop plans to focus on targeting the more affordable smartphone segments, with Lumia devices with a view that they the fastest growing segments of the market.