Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times technology reporter Janet I. Tu.
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October 25, 2013 at 6:09 PM
Waggener Edstrom Worldwide, one of Microsoft’s main public relations agencies, has laid off 43 employees — about 5 percent of its worldwide workforce — a result in part to Microsoft’s recent companywide reorganization.
Most of the employees affected work in Waggener Edstrom’s Seattle and Portland offices. Microsoft is one of Waggener Edstrom’s biggest clients.
As part of a companywide reorganization begun in July, Microsoft centralized its marketing and communications functions.
Peter Wootton, a senior vice president at Waggener Edstrom, attributed the layoffs to “client budget cuts” — mainly Microsoft’s — as well as the PR agency’s plan to move to an automated insights-and-analytics system that replaces a team that had previously provided that type of research.
Waggener Edstrom has about 850 employees in 19 offices worldwide.
Microsoft works with several outside PR agencies in addition to Waggener Edstrom, including Edelman, Weber Shandwick and Burson-Marsteller. It was not immediately known if those agencies are affected by Microsoft’s reorganization as well.
September 19, 2013 at 11:47 AM
Update 8:53 p.m.: Here’s my story, running in tomorrow’s print edition of The Seattle Times, on the financial analysts meeting.
In the story, I refer to a slide that CEO Steve Ballmer showed, comparing Microsoft’s profits and other financials with those of other tech companies, including Apple and Google. Here’s that slide:
July 15, 2013 at 6:00 AM
[In case you missed it, here's a one-on-one interview with Microsoft CEO Steve Ballmer that ran in the print edition of The Seattle Times on July 14, 2013.]
On Thursday, CEO Steve Ballmer announced one of Microsoft’s most sweeping reorganization in years, designed to increase collaboration and speed of innovation as the company transitions into a devices-and-services company.
He realigned the company according to function, cutting in half the number of product divisions and centralizing operational services.
In an interview with The Seattle Times after that announcement, Ballmer talked about how he intends to carry out that restructuring, how the company’s stack-ranking job-performance review system fits into his push for broader cooperation, and whether there’s a succession plan.
Here is the interview, edited for length:
Q: The reorganization is designed to enhance collaboration. I’m wondering how you plan on (executing) that. Is that more in the people who are heading these new units or in the structure with the cross-company teams?
A: I think it starts with the strategy. We’re not working on divisional strategies that we roll out; we’re working on a company strategy that we roll down. That’s No. 1, a single strategy.
No. 2 is goal sets. As we begin our new financial year (which started July 1), we start with a set of shared goals as opposed to a set of divisional goals that we then try to get some layer of harmonization against.
No. 3, we’re being quite explicit with particularly our engineering people that they own engineering areas. (For instance) the network team does networking, and they’re going to be the networking team for Microsoft, not that there’s going to be three or four networking teams…
No. 4, there is some work on the culture, and particularly underscoring the need to focus more. We talked about five key attributes: being nimble, communicative, collaborative, decisive and motivated — and collaborative and communicative are key parts of this.
Q: How do you plan to inculcate that?
[Continue reading the interview here.]
July 12, 2013 at 6:30 AM
[This story is running in the print edition of The Seattle Times July 12, 2013.]
When CEO Steve Ballmer announced Microsoft’s most sweeping reorganization in years Thursday, he said it was to make the company faster-paced and more collaborative — all the better to advance his vision of turning the software giant into a devices-and-services company.
That’s what makes the restructuring so crucial: The future of the company, and how well it competes in a changing tech market, hangs at least in part on how well this reorganization is executed.
Ballmer has realigned the company according to function, cutting in half the number of product divisions and centralizing operational services.
Previous divisions such as Windows and Windows Phone, or Office and Bing, have been collapsed into the larger engineering units.
Operational services such as marketing, finance and business development will now all go through a central companywide leader of those functions, rather than through each product division.
There are no plans for layoffs, Ballmer said during a call with reporters and analysts. But he did say there would be many changes in people’s job duties.
The reorganization attempts to address some of the shortcomings that have led a scrambling Microsoft to play catch-up in the smartphone, tablet and search markets as competitors, including Google and Apple, soared with their offerings.
This massive realignment is part of Microsoft’s strategy for the future — one in which desktop and notebook PCs and in-house servers on which Microsoft built its empire are increasingly overtaken by mobile devices and cloud services.
“We see this as being a really significant move for Microsoft,” said Al Gillen, analyst with research firm IDC. “It opens the door for them to make more aggressive moves to compete in the new world of computing.”
Microsoft recognizes that in this new world, it has to provide a more coherent, cohesive message to users about why to choose its offerings and to developers about why to build for and on Microsoft platforms.
“This is a change that Microsoft is putting in place to set them up for the next five years, not for the next few months,” Gillen said.
[Continue reading the story here.]
July 11, 2013 at 6:20 AM
Update 12:56 p.m.:
In a conference call with reporters and analysts, Microsoft leaders offered more insight into the restructuring. Here are some highlights;
CEO Steve Ballmer said “we have no plans for layoffs” in the restructuring.
CFO Amy Hood said the new structure should not lead people to think that there will be less financial accountability. She said the company’s fourth quarter and fiscal year earnings report next week will follow the old financial reporting structure.
But then, moving foward, “as we go through the reorganization and realignment, we’ll investigate any needed changes over time,” Hood said.
In a sweeping reorganization designed to further Microsoft’s transformation into a devices-and-services company, CEO Steve Ballmer today realigned the company according to function, cutting in half the number of product divisions and centralizing other services such as marketing, finance and business development.
The company will now be organized around the functions of: engineering (including supply chain and datacenters), marketing, business development and evangelism, advanced strategy and research, finance, human resources, legal, and COO areas (including field, support, commercial operations and IT).
Within engineering, the four groups are: Operating Systems, Applications and Services, Cloud and Enterprise, Devices and Studios.
July 2, 2013 at 5:28 PM
Could Microsoft CEO Steve Ballmer put Julie Larson-Green in charge of all hardware engineering for the company, including Xbox and Surface, and Skype President Tony Bates in charge of acquisitions and developer relations?
That’s apparently what Ballmer is considering, according to a Bloomberg News report on the reorganization being considered at Microsoft.
The restructuring has not yet been finalized, but could be so by next week, the Bloomberg report said, citing sources who asked not to be named because the plans are private.
Rumors have swirled around the restructuring reportedly underway as Ballmer aligns Microsoft more into a devices-and-services company.
July 2, 2013 at 5:45 AM
[This story is running in today's print edition of The Seattle Times.]
Don Mattrick, head of the Microsoft division that produces Xbox, is leaving to lead social-game company Zynga — a move that could signal the first big-name jumping of ship from Microsoft in an expected companywide reorganization.
Mattrick, 49, who has been president of Microsoft’s Interactive Entertainment Business for three years, will become Zynga CEO and a member of its board starting Monday.
Mark Pincus, Zynga’s founding CEO, will remain chairman of the board and Zynga’s chief product officer.
There’s been speculation that Mattrick’s move could have been motivated by a reorganization that Microsoft CEO Steve Ballmer has reportedly been working on and that could be announced as soon as Tuesday.
June 4, 2013 at 9:56 AM
Veteran Microsoft analyst Rick Sherlund, of investment bank Nomura, offered his thoughts in a note this morning on Microsoft’s reported restructuring, its big cloud push and its stock price.
Also this week, it was reported that CEO Steve Ballmer is apparently reorganizing the company to better align with his vision it becoming a services-and-devices company.
“We estimate the cloud is currently under 3% of Microsoft’s business, but Mr. Ballmer is expected to announce organization changes to better align the company’s development and marketing around putting the ‘cloud first’ in key parts of the business to push the company more aggressively in this direction,” Sherlund wrote in his note today.
Microsoft stock, which has been climbing and is currently trading at $35.58, is “doing well, which ironically might work against ValueAct in an effort to gain majority support from shareholders in a potential bid for Board representation,” Sherlund wrote, referring to the activist investor that earlier this year revealed it had a $2 billion stake in Microsoft. “We look for an interesting summer with some potential drama spilling into the public eye over shareholder activism to effect change and increase shareholder value. We think this is all positive for sentiment in the stock.”