Published: Wed, July 05, 2017
Technology | By Ramiro Moody

Microsoft's sales force reorganization could lead to "thousands" of layoffs

Microsoft's sales force reorganization could lead to

Some reports also hinted that the layoffs might be the result of a change in leadership.

Judson Althoff, Microsoft's executive vice president of worldwide commercial business, has said that the reorganisation is created to "align the right resources for the right customer at the right time", reported the Verge. (Note: These already were vertical targets for the company.) Additionally in Enterprise, Microsoft is charging its sales, partners and services team with addressing four "solution areas", he said. The source added an announcement would be forthcoming this week. This is likely as part of an effort to slowly move away from its software sales businesses and provide a boost to its burgeoning enterprise cloud services. Server products and cloud services revenue rose 15%, driven by Azure revenue growth of 93% year-over-year.

The reports of layoffs also fall in line with the previous trend of Microsoft announcing headcount reductions at the end of its fiscal year that typically falls in July.

Microsoft is planning a restructuring of its global sales force to focus on its cloud-computing products and that may result in large-scale layoffs.

The latest reorganization comes as Microsoft readies for its annual worldwide partner conference Inspire, which will take place in Washington D.C. on July 9.

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The reshuffle could possibly be due to the captaincy changing hands a year ago.

"This will enable our commercial customers to get even more value from our offerings and to drive success, as well as their own digital transformation", a Microsoft spokesperson told Moneycontrol in an email reply seeking comment.

The Redmond based software maker of the popular desktop operating system, Windows 10, is one of the biggest technology companies, employing hundreds of thousands of people globally.

The reports associated with the cut in the workforce were linked with an increased emphasis on cloud service within Microsoft's sales teams worldwide. But it will be focused on the company's sales organization, and it's aimed at improving the way it sells its cloud services and software. It targeted 2,850 job cuts, 900 of which were employees of Microsoft's sales group. In April 2017, Microsoft pledged to achieve $20bn (£16bn) in yearly cloud revenue by 2020.

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