The Microsoft layoffs are about culture not money

Man being fired
Credit: Flickr: Bill Alldredge

Now that we have the details of the Microsoft layoffs, it's clear that we're seeing two things. The first is the expected headcount reduction on the Nokia side, cutting jobs that are duplicates of roles Microsoft already has, dropping the vast majority of devices that don't run Windows Phone and reducing manufacturing capacity for the phones that are losing market share to Android. And the second is Satya Nadella trying to reinvent Microsoft by recognizing that the way you build software has changed just as much as the way we buy technology - and Microsoft needs to catch up.

What we're not seeing (according to sources at Microsoft) is layoffs designed to save money or shrink development teams. "Anytime you're cutting headcount people think you're shrinking but really what we're doing is changing the shape of the organizations to invest in the right ways, and to invest in internal engineering systems as a core priority," a source who asked not to be named told Citeworld.

Digesting Nokia is really just an opportunity to announce these changes (although the large number of Nokia layoffs does make the cuts seem bigger than they are, especially as some of those in the now-redundant posts may move to other roles at Microsoft). The plan is to modernize the way development is done to match the way software and services ship more often, and to get developers who take a much broader view than just writing code or - in particular - just testing code.

MORE LAYOFF NEWS: Layoffs signal Microsoft is throwing in the towel on hardware

The shift to integrating test inside development goes back to Nadella's time at online services our source confirmed, where the concept of testing not just code but the live site itself meant thinking differently about the whole idea of testing. Instead of saying the quality of the final code is the responsibility of the test team catching bugs, code quality became the responsibility of the developers; that meant the test team could switch to testing the systems instead of the code - measuring if it had enough capacity to cope with user demand, trying out the systems designed to cope with problems by deliberately causing those problems instead of waiting for something to go wrong. That's the kind of testing ecommerce sites like Etsy do all the time.

As Nadella moved on to take over the server and tools business and the cloud and enterprise teams, he took those ideas of integrated test with him. It was a big cultural change to do that for server software rather than a web service, but the new way of working "has taken pretty firm root there". Next for this culture shift is the Windows team, which makes sense given that rolling out new features and the kind of fixes that used to wait for a service pack now happens every month. Windows is a continuously delivered service, not an operating system that ships every three years and making that work means developing differently.

Adopting the 'growth hacking' mentality means there's no room for narrow roles at Microsoft. "If all you were doing as a developer is test, that's probably not a sustainable model in the world we're living in today," our source pointed out. "You have to be able to think about design and product management and being hands on with customers. You have to have a much broader view of what that means. You have to bake marketing into the product. The best products sell themselves; that means you have to think about value proposition early on."

If you're an SDET (what Microsoft calls a tester) in the Windows team or you work in the general marketing group, you're likely to be looking for a new position. This would be a good time for the easier ways of moving to a new role that Nadella promised to kick in.

One development size does not fit all

But Windows development won't be done exactly the same way as development on Visual Studio or on Azure or on Bing; even within Windows, different teams will work in different ways. There is no single model of engineering at Microsoft any more (not even the triad model used in Office and Windows), no hard and fast ratios of how many testers and developers and program managers make up a team. What you need to write the software that runs on Surface and Windows Phone is different from what you need to build Bing and Azure and Office 365 and different again to what you need to build Windows Server. It sounds like common sense, but it's a big shift for Microsoft, which has long thought it had the best practices of development well defined after years of experience.

Gone are the sacred cows and the traditional ways of doing things in Redmond. Nadella wants to get engineering teams "with new skills, new talent, with data culture, with better systems where quality is everywhere," our source said. Getting that means the change in culture he's been talking about since he became CEO and - in typical Microsoft fashion - it also means new software and new tools.

In the past, developers at Microsoft have been a bit like the cobbler's children (who never get new shoes, because the cobbler always sells them to customers instead), working with development tools that could be slow and frustrating; the build system for Windows ran once a day, and took hours. So Scott Guthrie (who has Nadella's old job running Enterprise and Cloud), Terry Myerson who runs the platform team and Qi Lu who is in charge of apps don't just have permission to change their organizations any way they want to deliver the new development culture. Guthrie and Myerson are also in charge of building the internal systems that Windows and the other teams will build their products with, which includes "modernizing  source code control, build and product management and [tools for] collaboration around code."

That's yet another big cultural change going on at Microsoft; cross-project code sharing Nadella refers to as 'internal open source'. Not only is stack ranking gone at Microsoft, but what you get rewarded for has changed; "it’s not just what you do, but what you provide to others and what you use from others," our source explained.

"Looking back there was sometimes [a tendency to say] ' I won't take a dependency on that' as a reason to recreate something that somebody has already done and that is anathema to what Satya is talking about. He specifically wants people to build on what others have done. And that means you have to have a better way of sharing code in a smart and responsible way. Scott [Guthrie] and Terry [Myerson] are working on a really ambitious project to make sure we have internal tools to make that kind of thing easy to do."

That's the kind of thing Steve Guggenheimer and John Shewchuck at the Developer Platform Evangelism Team have been pushing; as well as working with developers who want to use Microsoft's tools, they've also been organizing internal coding days. This year's annual Microsoft company meeting will be part of the one-week series of events - which includes a company-wide hackathon in two weeks. Instead of sitting back and listening to a marketing message, Microsoft wants employees joining in, contributing ideas, challenging the way things have been done and getting on board with the culture change.

Keep on changing

Wall Street is rewarding Microsoft for laying people off with a rise in the share price, but while these changes certainly give Microsoft a better chance of succeeding, it's not because the company is going to be writing fewer pay checks. It's because the people who will be building Microsoft products will have a different attitude with a broader range of skills and better tools, and they'll be working inside a company that's organized differently, that collaborates and shares more internally and that spends its money on things that matter to developers.

That's going to take a very different culture - and it's not going to be a one-time change. That doesn't mean dragging out layoffs, which is a great way to destroy productivity and motivation as thousands of employees worry if they're next for the chop - and doesn't appear to be happening. (While Microsoft's official financial documents say it will be dealing with the impact of the layoffs for a year, many of the Microsoft employees affected are finding out about it right away.)

It's about getting a culture where change isn't terrifying, because things keep changing and adapting (and hopefully improving). It's the promise of the responsive organization that uses enterprise social networking not as a Band-Aid to fix broken business processes but as a tool to let business processes emerge that actually fit the way people do their jobs (and it might be another sign of the Yammerification of Microsoft). 

If you want to do continuous development, you need to be able to change and develop yourself. As our source put it, "you can't take a culture and freeze it, then unfreeze it and change it and then freeze it again; it's something that has to happen all the time or you just get left behind."

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