Here’s Why Microsoft Employees Are Very, Very Worried

Steve Ballmer

Last week, Microsoft (NASDAQ:MSFT) CEO Steve Ballmer announced that he will be retiring within the next year after leading the company since 2000. Now, Microsoft is trying to assure its employees that Ballmer’s restructuring plan started last month will indeed continue, even under a new CEO.

According to sources who spoke to Bloomberg, some of Microsoft’s senior staff sent out emails to employees after the announcement of Ballmer’s exit was made, saying the company would stick with Ballmer’s plans even after his departure. Employees are worried that a new CEO will throw the already chaotic restructuring into further disarray. Microsoft, meanwhile, is worried that employees will become frustrated with the uncertainty and leave the company.

The reorganization is the biggest change the company has undergone in 10 years. Ballmer’s vision has all branches of the company working together to contribute to Microsoft’s most successful enterprises.

“We will see our product line holistically, not as a set of islands,” Ballmer wrote in an emailed memorandum. “All parts of the company will share and contribute to the success of core offerings, like Windows, Windows Phone, Xbox, Surface, Office 365 and our EA offer, Bing, Skype, Dynamics, Azure and our servers.” The restructuring is meant to shift the company’s focus away from software and toward hardware and Internet services.

The company is bring broken down into engineering, marketing, business, development and evangelism, advanced strategy and research, finance, human resources, legal, and COO divisions. Coordination between all these divisions will be the most difficult aspect of rearranging the company, but this type of integration has led to great success for competitors Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG).

“They need to change everything, everything,” Ivan Feinseth, chief investment officer of Tigress Financial Partners LLC, told Bloomberg. “They need to be better in social, mobile, analytics and cloud, and they really have very little to offer in those areas.”

The restructuring has left some executives running divisions in which they don’t have much experience, and since the reorganization was Ballmer’s idea, it’s left some employees concerned about their future with the restructuring and the company in general. But given the company’s weaknesses in social networking and mobile, which have helped cause the stock to fall 37 percent since Ballmer took the helm, Microsoft’s best bet is to find a new CEO as soon as possible and attempt to temper employee anxiety in the meantime.

Follow Jacqueline on Twitter @Jacqui_WSCS

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