Microsoft’s decision to offer buyouts for more than a quarter of its workforce is evidence of gross managerial dereliction of duty.
Most of us have been aware for years that artificial intelligence would have an impact on employment. Insiders in high-tech companies must have had even more awareness of what was to come. Microsoft’s workforce could have been reduced gradually through attrition, careful hiring and firing, and internal mobility in that time.
Microsoft says its New England Research & Development Center, opened in 2008 in Cambridge’s Kendall Square, hosts more 200 than employees “across multiple R&D teams”; a report by Neowin from 2012 said that was growing to more than 850 workers with a physical expansion.
Research shows that successful downsizings meet two important criteria: it is guided by a strategic plan that identifies those parts of the business that should be cut, but also those parts of the business that need to be expanded and reinforced; and top managers share the pain with the laid-off employees.
The voluntary exit offer extends “up to general managers and some employees with vice president titles, but not corporate vice presidents,” according to GeekWire. And on the strategic issue Microsoft has made a few steps in the right direction by not permitting some employees to apply for buyouts – potential evidence of a well-thought-out plan.
Based on a downsizing of this magnitude alone, though, top management should be dismissed for cause, and not with the golden handshakes sometimes used to soften manager dismissals.
The most likely applicants for invited buyouts are the most competent employees, because these will have the best chance of getting jobs elsewhere. This leaves less-able employees staffing the company, and the loss of knowledge – technical and organizational – will be enormous with a quarter of the employees leaving. When this happens, no one will know:
What’s a neat trick to close this loop? How can I speed up this program? Who do I go to in finance to get fast funding for this project? Who in human resources can expedite a hire? Who in middle management can make the best argument to the bosses to support my project?
I hope Microsoft survives this massive downsizing. As for me, the word is out. I will continue work with my favorite program, WordPerfect.
Martin G. Evans is a freelance writer. He writes about managerial and political issues, with contributions to The Boston Globe, Boston Business Journal and elsewhere, and was previously a professor at the Rotman School of Management, University of Toronto, and has taught at the London Business School, Harvard School of Public Health and elsewhere.
