Separation management
- 1. PRESENTATION ON SEPARATION MANAGEMENT IN MICROSOFT BY GARIMA GOEL M.COM SEM IV
- 2. CONTENTS • Separation management • Resignation • Voluntary Separation packages • Lay offs • Employees experience • Effect on share price of Microsoft
- 3. SEPARATION MANAGEMENT • Employee Separation is the process of ensuring that an employee who quits the company is exited in a structured and orderly manner. Employee Separation Voluntary Involuntary
- 4. MICROSOFT SEPARATION PRACTICES Voluntary Resignation Voluntary Separation packages Involuntary Lay offs (Acquisition of Nokia)
- 5. RESIGNATION • Employee leaves his job and employment with his employer to pursue better opportunities. • In Microsoft, Steve Ballmer, Former CEO,resigned after 14 years of service (2000-2014). • Reason- his duty as a basketball team owner of Los Angeles Clippers . • Mr. Ballmer's term on the board was slated to expire in late fall but he volunteered to leave early. • Mr. Ballmer's current holdings amount to about 4% of Microsoft's total shares, valued at $15.1 billion. • His stock holdings were boosted by more than $4billion- two times more than what he paid for his team.
- 6. Continued… • In his resignation letter, Mr. Ballmer indicated that he wouldn't completely cut himself off from his former company. "Count on me to keep ideas and inputs flowing," Mr. Ballmer wrote. "I bleed Microsoft—I have for 34 years and I always will." • His resignation was carried out in a structured manner without tarnishing company’s image.
- 7. VOLUNTARY SEPARATION PACKAGE • In 2009,Rafael Rollan, managing director of Microsoft Philippines, announced that he will quit his job and take advantage of voluntary exit package. • It was quite ironic since Rollan was part of the committee that evaluated the applications of the employees who wanted to be included in the VSP program.
- 8. • Offer included • It was too tempting for Rollan to pass up he was wary he might be hit by the redundancy program if he gave the VSP a miss. If that was the case, he would have received a smaller severance pay. • Apart from Rollan, other top executives of Microsoft Philippines also requested for the exit package though none has publicly acknowledged doing so. Three months worth of salary for every year of service A month's salary upon notice of termination
- 9. LAY OFFS • In 2009, Management eliminated 5,800 positions over the course of two-plus rounds. Then-CEO Steve Ballmer attributed the cuts to a "response to the global economic downturn." 2009 • On 17 July, 2014, CEO Satya Nadella announced about laying off 18,000 jobs over the next year, including about 12,500 associated with the Nokia Devices 2014 • Microsoft is planning to cut 9000 jobs by shutting down two manufacturing plants in Beijing and Dongguan,China. This news has not been officially announced. 2015
- 10. Largest lay off First Round in July- 13000 employees laid off • 12500 employees from Nokia after its acquisition • Layoffs targeted Microsoft’s research unit, the Trustworthy Computing privacy and cyber security group, Xbox and MSN, as well as a broad range of engineering and marketing roles. Second Round in September • 2100 employees laid off • Occurred across the board in "many different teams, functions and countries, Third Round in October • 2900 employees laid off • Cuts mostly came from human resources, finance, sales and marketing and IT.
- 11. EMPLOYEE EXPERIENCE • Undoubtedly, layoffs leave a sour taste in employees’ mouth. They are provided with severance pay and other benefits. But an employee who has given his life to Microsoft felt betrayed. • Worst affected were Nokia employees who were laid off after its acquisition.
- 12. A TALE TO TELL • He was the victim of layoffs. He gave 15 years of his life to Microsoft and blamed that it was an algorithm that got him fired. He, particularly, praised company’s insurance policy which helped him in providing a normal life to his autistic child. • Now, he has decided to become independent by developing his own game. He has his YouTube channel by name of ‘barnacules nerdgasm’ followed by 405k subscribers.
- 13. EFFECT ON SHARE PRICE • Shares of Microsoft have taken off since Satya Nadella was named CEO, and after unprecedented layoffs news and former and current leaders are benefiting handsomely. • Steve Ballmer, who stepped down as CEO on Feb. 3, now is $2.8 billion richer thanks to a 23 percent increase in share values since the day he left the company. That puts his entire portfolio value at $14.9 billion. • Investors have taken a liking to Nadella’s strategies for Microsoft. He soon will have the corporation focusing more on cloud and mobility. That tactic is making shareholders happy, as are the record number of job cuts Nadella is implementing. Investors have boosted Microsoft’s stock prices almost 6 percent in one week.
- 14. CONCLUSION • With share prices of Microsoft soaring after layoffs justifies the efficiency of separation management. It was handled properly otherwise it could have resulted in a disaster and brought ignominy to the new CEO, Satya Nadella.
- 15. THANK YOU!