In a move signaling a shift from broad-stroke layoffs to a more targeted approach, Microsoft has confirmed plans to reduce its global workforce by less than 1%, according to Business Insider. This translates to approximately 2,200 employees across various departments and roles facing potential job cuts.
Unlike recent industry trends of mass layoffs impacting specific divisions, Microsoft’s strategy focuses on individual performance. Sources reveal that managers across the company have been tasked with identifying and managing underperforming employees, with potential layoffs looming for those consistently failing to meet expectations.
This “performance-based cuts” model marks a departure from traditional bottom-up approaches, where fixed percentages of employees are let go regardless of individual contributions. In this new system, high-performing teams may remain entirely intact, while others could see significant reductions. This puts the onus on both individual employees to excel and on managers to make tough decisions regarding their team’s composition.
“At Microsoft we focus on high performance talent,” a Microsoft spokesperson stated. “We are always working on helping people learn and grow. When people are not performing, we take the appropriate action.”
This strategic move comes at a time when Microsoft is heavily investing in artificial intelligence, a sector showing immense promise. While other areas of the business remain stable, the company appears focused on maximizing efficiency and resource allocation to fuel its AI ambitions.
The layoffs are expected to generate cost savings and streamline operations, potentially creating a more competitive internal environment. However, this new approach could also lead to increased pressure and anxiety among employees, who now face not only the demands of their roles but also the added pressure of competing against their colleagues.
The long-term impact of this performance-centric strategy on Microsoft’s culture and overall productivity remains to be seen.
