Microsoft will reportedly lay off thousands of staff worldwide

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Taj Reid, Senior Designer at Microsoft wears a HoloLens VR headset at Microsoft's Windows 10 "Creators Update" live event in the Manhattan borough of New York City, October 26, 2016. Reuters/Lucas Jackson

Microsoft will allegedly scrap thousands of jobs around the world in a move to reorganise its sales force. The planned downsizing is expected to be announced this week.

According to a TechCrunch report, a source familiar to the changes said that Microsoft would lay off thousands of staff worldwide. The development is expected to include an organisational merger that involves its enterprise customer unit.

Bloomberg, The Seattle Times and the Puget Sound Business Journal previously reported “major” layoff plans in favour of a move to improve emphasis on cloud services with the US company’s global sales teams. The job cuts would be “some of the most significant in the sales force in years,” Bloomberg reports.

One of its sources confirmed that global sales reorganisation seeks to focus on selling cloud software. The claim was supported by a Business Journal source, who said the changes coming to the company will better support its cloud-first mantra.

The changes, a Bloomberg source said, would impact local marketing efforts in several countries. Another source revealed other possible smaller personnel changes in other parts of the company. Microsoft is yet to comment on the news.

Following the exit of long-serving COO Kevin Turner last year, Executives Judson Althoff and Jean-Philippe Courtois have taken charge of the company’s sales and marketing divisions. At the time of Turner’s departure, he oversaw 51,000 employees in an umbrella organisation for sales, marketing, operations and Microsoft’s corporate technology needs.

Althoff took over company’s business-oriented sales force while Jean-Philippe Cortois obtained oversight for the Redmond company’s foreign sales and marketing subsidiaries. The Seattle Times reports that job cuts would include 900 from Microsoft’s sales force.

At the end of March, the company hired at least 121,500 people, including 45,500 in the Washington state. The total tally also listed the 10,000 employees Microsoft scooped up in its acquisition of professional social network LinkedIn last year.

The end of the company’s fiscal year usually falls in July, the first in which Althoff and Courtois ran the sales and marketing organisations. In recent years, it has been a time when the company has announced headcount reductions.

Microsoft announced last year it would slash at least 2,850 jobs. In July 2015, it made 7,800 job cuts. Its sales group underwent training for years to sell software for use on desktops and servers.  It is understood it is now more critical to convince customers to sign up for cloud services.

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