Axe falls at the Volehill

Microsoft campusCorporate axemen have been stalking the corridors of Redmond and have so far claimed the heads of 18,000 employees, in the largest staff cull at Microsoft.

The cuts are the first major change made by Satya Nadella, the company’s new chief executive, who said Microsoft needed to be more nimble and focused.

The job cuts are 14 percent of its work force and most of them will come from the Nokia mobile phone business Microsoft acquired this year.

More than two thirds of the up to 18,000 jobs that Microsoft said it would cut will come from Nokia groups, or from overlap at Microsoft resulting from the deal.

Ironically morale at the Volehill had improved since Nadella took over, which might not have happened if people realised that job cuts were on the table.

Nadella has pledged big changes and make some quick decisions releasing Microsoft’s lucrative Office applications for the iPad. And he departed from past practice at the company by making its Windows operating system free for mobile devices to improve its market share.

But Microsoft has become bureaucratic and slow moving and has nearly double the 127,000 employees it had a decade ago. Apple has 87,000 and half of them in its retail stores.