exits from microsoft article

the current cover story of business week is:

Troubling Exits At Microsoft
Once the dream workplace of tech's highest achievers, it is suffering key defections to google and elsewhere. What's behind the losses?
(you can read the full article online if you complete the free sign-up process)

this article has prompted a fair bit of discussion amongst me and my friends. one of my former colleagues at microsoft summed up the points that he found to be insightful:

- Google now has a Kirkland campus. this is a brilliant business strategy.
- students are flocking to Google and Yahoo job fair booths.
- bottom-up collaborative approaches are the most satisfying for engineers.
- a "have and have nots" culture is demoralizing.

although the article touches on an important issue, it tends to skirt around what the writer is trying to explore. take these lines... "Google ... embarrassed Microsoft in October, 2004, by coming out with software that lets users quickly search the files on their Windows desktop before Microsoft released its own version" and then goes on to say "Adding to employee frustration is the company's bureaucracy." the decision to cut the search bar (I have seen the original specs so I know that they were written well before Google's version) is part of the bureaucracy, but the article separates the two. one problem that I've seen is that decisions about what to cut aren't always made the right way.

another problem I have with the story is that references in these types of articles to monopolies continue to annoy me. for example: "Its twin monopolies, the Windows PC operating system and the Office suite of desktop applications." I love how these comments show up in articles that simultaneously talk about how Apple, Linux, and other open-source programs are cutting into MS revenue. reporters can't have it both ways - no matter how badly this writer wants the company to be split up :)

getting back to the topic at hand... contrary to the official microsoft position, I think that they better change something or they will be heading towards a staff morale issue - and it's not just about Google. there will always be some hot new upstart company that is drawing in talent. I used to work with a guy that had left MS to join an online recipe company (note that he went back when the bubble burst).

I think the bigger issue for microsoft is the way that they are treating their staff. MS has never boasted about its salaries - a large part of the compensation came from fancy benefits. however, instead of maintaining the stereotypically attractive software company benefits, they have moved to a model where most teams operatete more like a government office (note that Bungie Studios has thankfully been kept away from the large corporate culture). I only worked at MS for 3.5 years, but in that time I saw benefits disappear. for example, I was there when the stock options were changed to stocks awards (a blatant acknowledgement that stock options were no longer a compelling benefit) - oh ya... and the whole towel thing.

part of the changes were included in a giant 1 billion dollar cutback (according to the article, it went even further). sure it was noble for MS to try and cut its expenses, but what was the cost to the employees? this was one point that the article nailed. in the end, the actual value of the damage to employee morale is moot because the whole program was a giant flop. it didn't affect the stock price and I can't remember a single significant piece of good PR that it generated.

so while MS continued to increase its profit margin, employees were losing little incentives to stay. I can remember when I worked for a startup and another local tech company was giving out company holidays to the tropics. my manager said "you have to be careful with things like that because you may have to take them away - then you're employees are pissed."

microsoft is a very strong company, but they better show their employees some love.