Microsoft is preparing for a new round of layoffs

Insider sources say leaders at several Microsoft divisions are discussing cutting middle management and increasing the developer-to-worker ratio on projects. Some groups are also looking to increase the control ratio, or the number of employees per manager.

The scale of the layoffs is unclear, but one source said they were "quite large." Microsoft declined to comment on the report.

Insider says Microsoft will cut staff next May

Cutting middle managers is gaining traction among tech companies. In December 2024, Google CEO Sundar Pichai said that managers and vice presidents would be cut by 10% to boost efficiency.

At Microsoft, discussions have focused on reducing the PM (product manager/program manager) ratio in some groups. This is the PM/engineer ratio.

Charlie Bell, Microsoft’s head of security, brought this model from Amazon to Microsoft and called it the “builder ratio.” They track the ratio of programmers to positions like PMs. His security team has a ratio of 5 1/2 to 1, and he’s aiming to get it to 10 to 1, according to sources.

Earlier this year, 2,000 Microsoft employees who had received poor performance reviews left. Next month’s cuts will also include underperformers. At least a few executives are considering terminating the contracts of people who have scored 80 or below on employee reviews for two consecutive years, one person said.

Microsoft rates employees on a scale of 0-200. The scores affect stock and cash awards. The average is 100, with 0, 60, and 80 being low; 120, 140, and 200 being high. Those in the 80-point range receive only 60 percent of the stock award and 80 percent of the maximum bonus.

Source: https://baoquocte.vn/microsoft-chuan-bi-co-dot-sa-thai-nhan-vien-moi-311269.html