Nadella conservative and radical route

Hou Jiyong

Microsoft layoffs shortly after, many Microsoft employees are speculating Microsoft's strategy, especially those sensitive sectors. The so-called sensitive sectors, which may be layoffs, such as the Nokia mobile phone business units, as well as related business unit.

A Nokia employee disclosed in the 21st Century Business Herald: "In fact, the day of being merged awaiting the storm is either anticipated or integrated into other business units, but it is a reality that we all are prepared for. "

July 15, according to foreign media reports, said Microsoft may layoffs, while the proportion of layoffs will be between 5% to 10%. Before the acquisition of Nokia, Microsoft's number of employees worldwide has reached 100,000 people. In early June this year, Microsoft officials said there are currently more than 127,000 employees, that is, Microsoft's current round of layoffs in the range of 6,350 to 12,700.

The layoffs are just the result of Microsoft's new CEO Nadella governing Microsoft's thinking: Will not attack Ballmer's thinking, but will Microsoft's existing organizational structure of the knife, the implementation of the New Deal. The result of the knife will inevitably bring about changes in personnel.

In fact, Nadla recently hinted in a mail addressed to insiders that Microsoft will lay off staff, adjust the organizational structure, and will adjust the company's strategy. External analysis, Microsoft may give up the "equipment and hardware providers," a strategic position to return to software and services.

To give up Ballmer's line, this is Nadla's radical; back to software and services, it is Nadla's conservative place. For Microsoft or Microsoft investors, it is important to get Microsoft out of mediocrity.

Brokeback survival, scraping bone healing, change is the outside world of Microsoft's expectations, investors are optimistic about Microsoft's adjustment. Carrier rumors came out last week, Microsoft shares have been in a rising trend. July 14, Microsoft shares rose slightly on the day 0.12%.

Nadra route

On July 10, Nadella sent an email to Microsoft employees. Nadella hinted that Microsoft should focus on its own unique strategy, while the strategy will be different from the previous "Ballmer" proposed "equipment and services" principle. Nadella said Microsoft is at the core of a mobile-first, cloud-first, company that provides the world with productivity and platform.

Nadella said in an e-mail that Microsoft plans to organize a dialogue on this ambition with Microsoft's core focus in July and has asked Microsoft executives to evaluate improvements to the innovation process and streamline operations and workflow. Nadella said he will share additional comments with other executives throughout July about what they consider necessary for engineering and organizational readjustment.

Nadra hinted that July 22 Microsoft released this fiscal year performance may disclose some details.

Microsoft's new fiscal year from July 1 onwards, for Nadella, announced in the earnings release layoff details in preparation for the announcement of a new organizational restructuring and the new strategic release. If the proportion of layoffs is true, then the number of layoffs far exceeded the size of the 2009 layoffs, that Microsoft cut the number of 5800, the main reason for the layoffs PC market decline.

The foreign media sources said the layoffs sector is Nokia's mobile phone business, there may also be involved with the Nokia mobile phone business overlap, in addition to the affected marketing and engineering departments. Microsoft's move is intended to streamline the organization and complete the reorganization of the Nokia handset business.

The reduction of personnel involved with the Nokia handset business and its related departments is a devastating blow to Microsoft's equipment division and represents Nadella's move to governed Microsoft by no longer implementing "device + software" but pushing for new policies.

Microsoft last CEO Ballmer left office last year, set the strategy for Microsoft is "equipment and services", that is, as a software-based Microsoft, in the "software + hardware + services," the three aspects of force, to achieve mobile Internet Gorgeous turn times.

What's the new route? Sun Yonglai, an independent IT analyst, said that if the reduction, the merger of Nokia's mobile phone business and related business units, it means that Microsoft will weaken the importance of hardware devices in Microsoft's business, focusing on software and services.

It is based on the "equipment and services" this idea, Microsoft under the leadership of Ballmer acquired Nokia. However, in the past two years, Microsoft has been "equipment and services" to explore the road, but not successful. Microsoft Can not Continue On the Path to Failure: Based on past practice of the past two years, Nadra has chosen a strategic contraction, abandoning equipment and returning software and services.

Microsoft's redemption

"Equipment and services" strategy is Microsoft's tribute to Apple: It is through this model that Apple has won in the consumer field, and Microsoft hopes to beat Apple by learning Apple. However, this model has been questioned from the very beginning.

However, Microsoft's path is different. Compared with apples, Apple has only implemented the "software + hardware + service" triathlon in the consumer domain. Microsoft is not only in the field of consumption, but also implements the triathlon in the enterprise level.

This strategy has undoubtedly made Microsoft's frontline too long. Even for companies such as Microsoft, it is not possible to achieve "software + hardware + service" triathlon in both the enterprise and consumer markets: one year after the implementation of the strategy and the lack of support from Microsoft in the field of equipment , A slight gain in the field of enterprise services (cloud computing), and the personal service did not meet the original expectations. The plan is not successful, Ballmer also sadly step down after trying last year.

Microsoft equipment products include consumer Tablet PC, smart phone business, the former represented by the Microsoft surface, the latter represented by the Nokia mobile phones, these two types of products on behalf of Microsoft's new exploration. In addition there XBOX game console business, but it belongs to Microsoft's traditional business. Abandon equipment products, mainly to give up these two types of products.

The staff disclosed that if you give up the device, Microsoft in addition to the traditional software business, will strengthen the cloud computing business. From the performance of the past two fiscal years, due to the weak PC market, Microsoft's software business in a downward trend; equipment business in addition to XBOX at a huge loss; cloud computing business has become Microsoft's business growth center of gravity.

Give up equipment, develop new strategies, be Nudra to save the declining prescription of Microsoft. Microsoft needs new changes, to give up Ballmer's strategy, in the sense that Nadella is a radical.

This choice is also the return of the strategic line: the PC era of professional return to the line of professional return, rather than Apple's closed whole-industry chain layout practices. Both paths have been successful, but now Apple's line is more popular.

PC is a thick shell, Microsoft carried it back step by step, like a difficult snail. Nadla abandoned Ballmer, but cling to the PC tradition, in this sense, Microsoft's new CEO Nadella is a conservative.

Sun Yongjie is not optimistic about the change of Nader: "Software, services, hardware Trinity, Microsoft will not bring any collapsing effect." He believes that equipment business should be time, in the Tablet PC, smart phone business Outside more attempts, smart TVs, wearables, smart cars and so will be the next wave of innovation, Microsoft has a chance.

Sun Yongjie believes that the nature of future competition is not "software + hardware + services," but from the product, platform to the ecological chain three-step, Nadla should from this perspective, rethink Microsoft's strategy. If the product must be "software + hardware + service" in order to achieve the ultimate in order to surpass rivals, Microsoft must adhere to in order to be a platform, and finally to the ecological chain. (Editor Lu Aifang Xin Court Wei)