Microsoft Competing on Talent

11 November 2016

Prime example is Steve Ballmer who helped Microsoft sustain leadership in competitive market. Bill Gates and Steve have deliberately fashioned an organization that prizes smart people. The intense interview process on thought process, problem solving skills and work habits ensured great match to Microsoft vision. Microsoft’s tight control on headcount to “n minus 1,” further reinforced the pressure to resist settling for the merely satisfactory candidate. Employees were retained by creating a comfortable work environment that provided privacy and morale boost.

The work environment was also very competitive with anything less than 100% performance not good enough. Employee ownership has been the golden handcuffs with 10000 current employees options worth >1million in 1999. A well defined linkage between performance and brutally honest feedback has helped in retention. The rigorous selection process, challenging work environment and a organized review and reward process has made people Microsoft’s source of competitive advantage. 2)How effective are Microsoft’s human resource policies and practices?

Microsoft Competing on Talent Essay Example

Have the informal processes of the 1980’s been appropriately adapted to the company’s growth during the 1990s? During the early 90’s, Microsoft needed all the drive and passion for its legendary Hard Core culture. That created individual excellence and a passion for product and technology. However, with growth Microsoft needs to establish a more formal process of leadership grooming and selection. I believe Ballmer with the help from Robert Herbold and Doug McKenna has instituted some effective HR policies that has helped the company growth

What do you think of Ballmer’s recent changes to Microsoft’s human resource policies and practices? With Ballmer’s changes in HR policies, leadership development is taken seriously by Microsoft’s top executives. It also resolved the unevenness in the level of commitment of the early leaders. With a extensive groping of potential leaders in 3 categories, Microsoft is looking for immediate leaders and as well as planning on grooming the ones early on in the career that will affect Microsoft future.

A well defined strategy has been established (70% development from current job; 20% form mentoring relationships with other people;10% formal training; Developing new training programs; Increasing mentorship; Looking at more job transfers potentially international assignments). An extensively structured in review and feedback process has helped in clarifying the success factor at Microsoft and has played a key role in ensuring open, honest communication, learning and diffusion of core norms and learning.

Although the turnover rate is still low and offer acceptance at 90% for industry and 72% for campus, to entice great candidates and to reward performers a revision in base pay form 50th to 65th percentile and twice the opportunities for promotions has been established. Why did he make these changes? Microsoft hired brilliant technical people early on but they were not great managers or people developers. In early 90’s a Darwinian approach was used, only a few great leaders were hand picked which was just enough for a small organization. With growth, more effort needs to be put on leadership and management development.

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