Pre-Town Hall, Posters, and Micronews
Post-Town Hall Update: so, what did you think? Nothing too shocking. Rather than address the whole Limited label issue HR just decided to go with percentages. No more Limited II, true! Now you're just a 10%'er and your manager gets to beguile you with numbers. It still means: time for you to leave.
Speaking of being beguiled with numbers: can someone put a spreadsheet together to compare similar stock awards under the old and new programs? Given the stock going up two bucks a year and the stock going down two bucks a year. My very shallow first impression is that you lose if the stock price goes up, but that surely cannot be. No one would design something that way and say, "Hey, at least the stock is going up! Stop yer whining!"
Meh.
Administrivia: I'm having an unhappy blog connection, so things might get blocked up here and there.
The Week Ahead: it's a Town Hall meeting on Tuesday. I value this and I believe it helps build a bridge between executive leadership and the rest of us everyday contributors. And it looks like a potential w00t! fest: it's not myMicrosoft 1.1 nor is it myMicrosoft 1.5, but rather myMicrosoft two-point-freakin'-oh. That turns my expectation dial up to significant.
What are some example announcements or topics you'd like to see that puts Microsoft on an efficient and productive path with appropriately reward and motivated employees? Some of my top of the mind include:
- Reflection on our awesome package: I think before you look at any changes or other rewards and compensation, you do need to take a moment to reflect on our total compensation package. It is still awesome, especially the medical benefits. Sure, they could be better, but they were great when I joined and have just become even more awesome: way more than any company I've worked for (or have considered working for).
- Limited and Limited II: aka, "Dumb and Dumber." If during the past year no-one in HR has managed to do something about this poorly chosen designation, let alone the Limited II insulting moniker, everything else is useless. Limited II is today was the trended 3.0 used to be: a demoralizing kick in the pants to what is an effective, valued employee. Should a Limited II stay with Microsoft after that slap to the face, you are setting a low performance bar for them to drop their contributions back to and meet. Why would any review system have this? If this is fixed, I wonder whether to clap: "And, hey, we fixed this abhorrent insulting mistake we shouldn't have made, just for you." "Yeah! Hurray! OMG, you're soooo awesome! Hopefully you break something else this year so that you can fix it next year and we have something else to clap about!"
- Internal transfers: easy and easier. Only if you're moving between job descriptions (e.g., SDET to SDE or SDE to PM) should you go through a full-blown interview loop. A hiring manager can decide an interview loop would be appropriate but would have to get HR's buy-in. And if it's just between teams in a product group (say, between Access and Excel), it's just a done deal. Excellent teams with excellent leadership should find it easy to attract the best in the company. And poor teams with poor leadership should likewise discover themselves giving over a bunch of empty offices.
- Hiring: I want internal transfers to be easier as part of load-balancing within Microsoft and to stop the hiring madness. But I know the madness will continue. We have to ensure that the best are getting in and that the best actually want to be here and can be effective. Hiring should be clamped down on, and we should go through a year of where only Microsoftie interviewers who have made the best "no hire" or "hire" decisions for candidates - matching their feedback on hired candidates career velocity and reviews - are put on loops. Everyone else has to go through retraining to get back on.
- ESPP: back to 15% and the way it was. No clapping for this because it's just fixing another dumb mistake that shouldn't have happened in the first place.
- 401k: And in addition to a pony and a milkshake, I'd also like Microsoft to match our 401k at a higher percent and even contribute some to it as well. The stock isn't working out as a retirement plan, so Microsoft should make this their focus now in retaining employees who suddenly have that, "Ooo, I need to think about retirement" revelation.
- Tool fatigue: the Rube Goldberg machine that is our current review system toolset has to be streamlined. I feel bad enough managing my career vs. focusing on getting great results for my product team, I really don't want these tools managing me and sucking up a week here and a week there for my team. It's so bad I want the return of the old Word document. Again, I feel a bit abused if I clap for simplification here: you made my life suck and now you're making it suck less. You're... awesome? (Well, okay, I guess you are awesome. You pushed for a change for the better to address employee concerns. I think it just got a bit too Frankensteined up along the way.)
- MSPoll: early results from the latest MSPoll are... ? And don't go and sugarcoat any bad results. I think you can rely on InsideMS to bring-up ad-hoc discussions of the bad numbers. Please don't let it come up that way.
I really don't care about Bread and Circuses like food service, dry cleaning, and the like (but, uh, please don't take my Starbucks machine away because I've become quite addicted, even to its little brewing cycle clucking).
I'd appreciate Mr. Ballmer taking this chance to hit the reset button and go over major changes in what we value in this company. First of all: we reward for shipping and for profits. Followed by accountability. In addition to a second milkshake, I'd also like a change in perspective about the stock: if the stock price is not a valuable measurement of a publicly held company, what is? And if anyone dares to put up a one-year chart and strut about saying, "Hey, hoo-yahh, lookie at that break-out stock performance!" they, and anyone who cheers, deserves a solid dope-slap to the back of the head. Gee, how did we get all the way down into that slump to begin with (remember: Wall Street + $2,000,000,000 surprises = huge stock drop)? How does the last five years look?
I'd also expect all that Quests that the L68+ Partners have been involved with to turn into results that Mr. Ballmer is going to put into action and share with us. Otherwise... what were all those Quests for?
Anyway, I look forward to reflecting on the changes coming this week and then dialing things here at Mini-Microsoft down to low-key here and await the FY07 results.
A Plan For The Posters: this past week my mailbox came stuffed with gobs of promo-stuff, including a glossy about the Technical Community Network. Look, there's Queen Gertrude's observation over protesting too much. Bragging too much is a sign, too, and a rather desperate one at that. And as I flipped that TCN into a recycle bin to let it join a large stack of its siblings, I looked at the weekly replacing of the internal promotional posters. Okay, I'm not going to complain. Complaining doesn't solve anything. My solution to all the expenses around this mostly ignored internal promotion stuff?
The return of hardcopy Micronews. Slick. In color. Ad supported. That's right. No more posters. Your group advertises in Micronews instead. And if you really want to put up a poster, well, you still give a percent over to the Micronews budget. One pro being that people will have your website address in front of their computer vs. having to remember it after wandering the halls. And I'd expect Micronews to change and be less of the softballer it ended as but rather an advocate of engineering excellence across the company and to have a hard-nosed Microsoftie editorial freedom. We have a bunch of great writers: have the editors grab interesting blog posts or have those internal / external bloggers write an occasional piece. Summarize great resources in Microsoft. For instance, we have fantastic training at Microsoft: have a monthly summary of some of the more interesting classes.
And sure, have an online version, too.
Finally: two interesting news bits I saw today:
Microsoft claims software like Linux violates its patents - May 28, 2007 - an interesting confrontation to manage. We've been circling this boxing ring for a while, and it looks like we've at least put on our gloves and have started jabbing the air to warm up.
Why Doesn't Microsoft Have A Cult Religion - Microsoft Blog - InformationWeek - it is rare to see a Microsoft fanboy. It's something I've tried to work on for my responsibilities and my desire to build relations with the Alpha-Geek crowd. I think we need to cultivate fandom. If we can't, we have to be honest as to why people are not fans of our technology and our products. A snippet:
Think about it. When was the last time an editor was fired because of a scathing article entitled, "10 Things We Hate About Microsoft?" When was the last time a group of developers stood up at a VS Live show and shouted ... "Yea, man! Orcas Rocks! Language Integrated Query is da' Bomb! New and improved ADO.Net? Oh, no you didn't!" It just doesn't happen.
134 comments:
Our comp structure sucks.
I say that having looking at 4 offers a year ago, and decided to join MS, based on the interesting work I was offered, the location, some career development reasons, and the quality of co-workers. I turned down other, substantially higher offers for the intangibles involved. The medical care is an awesome benefit if you have a family.
I'm not complaining, but I am seeing smart co-workers leaving because the total package isn't awesome.
I am seeing smart co-workers leaving because the total package isn't awesome.
What would convince them to stay (I can't believe I'm asking that)? What would make our package suck-less?
$$$? What was the difference between your offer at Microsoft and the other offers? $5K? $10K? And was the location Seattle?
Mini -
It could be said that MSFT was fighting a proxy legal war thru SCO for a couple years.
Sure MSFT may have "finally" opened up a direct Patent fight with OSS, but the legal might of the big companies behind it are intimidating.
IBM, GOOG, SUN, and many more are going to come to the defense of the penguin.
And, I'm sure that there are hundreds of patents in their portfolios that will be brought out to beat MSFT with.
Microsoft compensation package is top notch.
I joined 2.5 years ago as an SDE/T and recently left for an SDE job at another well known company in the area. I had a few offers at other companies up here as well, all about the same package.
The job I took has higher base pay than MS -- but insurance co-pay, ins premium for family, bonus plan, etc, weren't as good.
Being in test was like getting kicked in the nuts everyday, so I left regardless.
This comment is going to sound like corporate cheerleading but isn't. I was (and am) a Microsoft fanboy - way before I joined the company. have fond memories of long flamewars - including one with Stallman himself :).
One mistake a lot of people make is to not see the MVPs we have, the number of people on www.asp.net or MSDN forums or the Microsoft newsgroups or even sites like Neowin. Just because they don't turn up on Digg/Slashdot/Techmeme doesn't mean they don't exist in large,large numbers.
What would convince them to stay?
I can't believe I got you to ask that! :)
There's a lot of resonance with your blog--which I was reading before I joined. Things like less red tape, faster ship cycles, more awesome products. More teamwork would also be helpful. There's value to competition, and there's value to working as a team, and helping make others great.
Comparing packages (with signing and expected bonuses, stock, options, etc) over a 2 year stint, it was a 35% (top-line) difference from the MS package to the top package. With tax and cost of living differences against Silicon valley, it was a smaller difference (I figure on the order of 15-20%. Depends a lot on how you count the impact of taxes, cost of gas, cost of sitting in traffic for an hour each way..)
What a refreshing post, I was able to agree with a lot that was said.
My offer coming to MS was a little less than I hoped for. However, since joining it as been a series of small gains. The last (more typical) company I was at it was a series of small nicks. Is it any wonder I'm feeling more positive to MS over time?
From the you heard it here first dept
So here is what you are going to hear about your stock awards from LisaB: we are going to move from a share basis to a value basis . Yeah I dont know what it means, but I can guess that instead of being given a 100 shares, you will be given shares worth 3000 dollars (assuming current market price is 30). So the last link between employee compensation and Microsoft performance has finally been cut.
All you LisaB fanboys - smoke that.
Why no MS fanboys? It's because Microsoft is viewed by the outside world as a monolith. No matter how good some piece of the company does (and it seems like DevDiv and Server are doing great things), there will always be some other piece which screws things up. It's hard to love a horizontal company like Microsoft.
Recent news, like Bill Hilf's statement that "Linux is Dead" and Brad Smith's discussion of Linux violations of IP do not help matters for MS-supporters like me. It just riles up the FOSS heathen. I don't know what the finances say exactly, but I wonder if increasing the importance of Patents in software will affect Microsoft's earnings positively or negatively (it seems like MSFT has been losing a whole lot to patent trolls). I usually like to point out to FUDsters that Microsoft is rare to sue anyone for patent violations (I've only been able to dig up one case against Belkin), but now that may no longer be true.
With the latest wave of technology that appeals to the consumer and small developer (Office 2k7, silverlight, .NET 3.0), Microsoft could develop a big fan base. The big-wigs just need to avoid doing anything indefensible in the court of reasonable public (web) opinion.
I disagree with your general position on internal transfers.
I definitely don't think that people should be held hostage in a group that sucks. We should remove barriers that prevent good people from getting stuck in bad groups -- talented, high performing individuals shouldn't be held down by bad managers who can't fathom what would happen if the one rockstar on the team left. That situation is symptomatic of deeper managerial problems and we should fix those in other ways (i.e. if the group is underperforming, kill it and let those resources be invested elsewhere). I get the general impression that you're in favor of terminating charters sooner rather than later if the writing's on the wall, so I think you'd support this.
In that world, you absolutely want internal transfers to go through some form of a loop in order to transfer jobs. Internal loops are what keep underperformers from floating between underperforming groups where lowered levels on contribution is the norm. True rockstars shouldn't have any problems getting through a loop with another team if they really are rockstar enough to meet the bar. And if you can't find a group that you'd like to work for and loop well enough to convince that group to hire you, then you probably should go find a job someplace outside of Microsoft.
Speaking as a senior PM on a team with open PM headcount and who has personally "no-hired" more than one internal candidate, I'm glad we have internal loops. The reality is that teams vary widely across different divisions within the company, and success in one part doesn't necessarily translate into success in another part. As long as the team doing the hiring has to contribute the headcount for an internal hire, then I think that team gets to interview whoever they want however they want without getting HR involved to find the best person for the job.
There's another spin on this issue, too -- one of the problems inside of Microsoft right now is the various personality cults and fiefdoms that exist within management. By putting internal hires solely in the hands of the hiring manager, you're just letting these things proliferate.
Loops are necessary things. Quality candidates shouldn't have any problems getting through them anyway.
...we should go through a year of where only Microsoftie interviewers who have made the best "no hire" or "hire" decisions for candidates - matching their feedback on hired candidates career velocity and reviews - are put on loops. Everyone else has to go through retraining to get back on.
Two questions...
(1) Is there data that correlates hire/no-hire decisions with actual performance of those hired? Is that info actually collected and available?
(2) What is the thinking behind this suggestion? Why do it? Reading between the lines, I'm guessing that there's some perception of something broken in the interviewing process, but I'm hesitant to deduce the problem from the proposed solution.
>We've been circling this boxing ring for a while, and it looks like we've at least put on our gloves and have started jabbing the air to warm up.
'Making sense of Microsoft's open source fetish'
http://weblog.infoworld.com/openresource/archives/2007/05/making_sense_of.html
read down till you come to the part in the article which says:
"Because here's what happens the day Microsoft sues Red Hat, Ford Motor Company, or whomever:" and then read on.
Like I said, I can't wait for Microsoft to file the first lawsuit against a customer. Bring it on Smith.
we are going to move from a share basis to a value basis . Yeah I dont know what it means, but I can guess that instead of being given a 100 shares, you will be given shares worth 3000 dollars (assuming current market price is 30). So the last link between employee compensation and Microsoft performance has finally been cut.
From what you describe, this sounds like a minor change to improve clarity.
Communicating to people the stock award opportunity based on budgeted current cash value rather than budgeted quantity of shares just seems more to the point.
MS doesn't have to rebalance the documented share amounts yearly based the on stock price. Adjustments based on employee market value would be more visible without translation, the way you can compare (leaked?) salary band charts year over year.
Without rebalancing, if stock grant amounts were fixed year over year and the stock is going up, it would cost MS more to give the same awards out, while if the stock is going down, people would feel cheated.
In your hypothetical "value" scheme there is still a link to company performance - after you get your restricted grant, you still want the stock to go up before you vest.
I like parts of the post, but...
Limited II is today was the trended 3.0 used to be: a demoralizing kick in the pants to what is an effective, valued employee.
They're just going to drop down to plain old limited and then they can kiss their employment goodbye. Somehow that's a good thing?
A hiring manager can decide an interview loop would be appropriate but would have to get HR's buy-in.
No way. I do not want C managers letting in more Cs or empire builders bringing in their cronies without at least a crack at filtering them out. Although I suppose getting rid of limited II works well with this scenario since duds can dropped straight to limited and fired more quickly.
Let's beef up the interviewing course instead with a week of intense live interview pratice instead so that loops are focused and productive.
ESPP
401k
I want neither because that's a losing scenario. Bumping up the pay won't have any lasting effect on morale.
You want movement in the stock? Spend the money doing better engineering (I won't be touching Vista until SP1) and cooler stuff that will interest the pro, e.g. Powershell. This will help us get more credibility with computer professionals as well as help us recruit better people.
>> senior PM on a team with open PM headcount
>> and who has personally "no-hired"
>> more than one...
You'll end up hiring a dude whose bullshit comes the closest in smell to the kind you're accustomed to. He won't necessarily be good or bad, you'll hire him on the smell alone.
A senior PM should realize that a successful interview loop is not a guarantee of a good hire. Just like a bad loop doesn't give you a guarantee that the guy/gal would not be good in a particular position.
You can not determine if the person is a good or bad fit within 40 minutes or by having him write some code to solve a BS problem on the board. Personally, I think I've totally wrecked every single loop I've been on (someone must have said hire, though, so probably I'm mistaken). Yet I got hired, I'm progressing steadily through levels and every time I move from one group to another PUMs and GMs beg me to stay. Why did I screw up in the loops? Because I just can't do it on the whiteboard. My brain freezes when someone is watching over my shoulder. Give me Notepad at least, or a sheet of paper, and I'll code up anything.
For me, internal loops are an impediment. I'd rather replace them with test assignments. Throw me in the middle of a problem and let me solve it. See how I do. Invite me for a non-technical interview to see if I have communication or attitude issues. THEN make a decision. That'd at least be fair.
When Steve Jobs talks, it's about specific, concrete, tangible, valuable improvements to Apple products. When Ballmer talks, it's about upgrade cycles, stock prices, market share, etc. and maybe some incoherent drivel about empowering customers. The message? Apple improves its products to help you out and Microsoft tries to take your money. Is it really a big mystery why Apple has rabid fans and people resent being locked into Microsoft software stacks?
Why no Fanboys ?
When was the last time Microsoft had something with the 'coolness factor' in it ?
In linux, I find it incredibly cool to see all that code. I find it cool that something does not work and instead of whining I actually can fix it.
In Apple, I find the UI and Steve Jobs incredibly cool.
These above are out of the box. OTOH, a vanilla installation of Win does not give me any coolness factor. Nor does Balmer or Gates inspire any feeling of coolness factor.
The only good thing about Windows is that I can play games on it ... but with Microsoft pushing for XBOX games first, it may be killing its market for that too. (I find Wii to be cooler than xbox - so if I go for a box to play games - it would be the wii).
And you wonder why no fanboyz ?
As a HR manager, I see our leaders only paying the partners.
Inspite of mspoll, everyone is going to be disappointed with the merit increase this year.
First of all: we reward for shipping and for profits. Followed by accountability
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Wrong. We reward for boondoggle ala search and adcenter team promos.
"Microsoft says software like Linux violates its patents"? Bring it. You'll be sorry you ever went down that road, believe me. You're so confident of your patents you won't even say which ones they are, for fear of having them invalidated.
Internal loops are important. The easiest way for leads to get rid of poor performers is to convince them to switch teams. Teams run loops to protect themselves from hiring someone else's problem.
Also, levels still mean radically different things across teams, and interview loops guard against that too. There's no comparison between, say, a level 63 SDE in Office vs. MSN.
MS software is on over 90% of the worlds PC's. I've never heard of a cult comprised of the "majority".
> Also, levels still mean radically different things across teams, and interview loops guard against that too. There's no comparison between, say, a level 63 SDE in Office vs. MSN.
Which means that Microsoft value less people working in Office/Windows than people working in MSN/Live (imagine two ideal twin-workers, one in Office, one in MSN -- MSN guy is paid more, hence, he is worth more to this company).
How much I should ask for if I leave MS? I know everybody took a paycut when joining MS but now I am negotiating with a new offer also in Seattle, should I look for 30% salary bump or more?
Joe is right. If Big Blue wants to sink Microsoft with patents, they will win, big time.
Did you know that IBM has a patent on auto-scrolling if you fill in the bottom line in a terminal window? Obvious to us today, but it wasn't in the 1950's when the video terminal was being invented, was it?
Which means that Microsoft value less people working in Office/Windows than people working in MSN/Live (imagine two ideal twin-workers, one in Office, one in MSN -- MSN guy is paid more, hence, he is worth more to this company).
Why is this surprising? The best rewards should always be in the riskiest/unproven areas. Rest assured that the people who created Windows/Office have been amply rewarded - just like the people creating MSN.
In your hypothetical "value" scheme there is still a link to company performance - after you get your restricted grant, you still want the stock to go up before you vest.
and that is different from Joe investor putting his bonus into Microsoft shares how?
I am surprised this piece of information hasn't gotten the kind of publicity it should have. As an earlier poster says "the last link between Microsoft's performance and employee compensation has been cut". Spare us the trouble of paying Fidelity $20 or whatever to make the trade, and just give us deferred cash bonuses because that's basically what this is.
Why do I care if the stock goes up or not? I'm going to get the same money regardless. Even that tiny sliver of a dream of striking it rich is gone for most of us now.
"Did you know that IBM has a patent on auto-scrolling if you fill in the bottom line in a terminal window? Obvious to us today, but it wasn't in the 1950's when the video terminal was being invented, was it?"
Didn't you know that patents have a limited life span?
>Wrong. We reward for boondoggle >ala search and adcenter team >promos.
This is so true. This needs to be fixed. More competitive team in Windows, Office & Server+Tools don't need additional incentives to attract candidates. While other badly run team use additional perk like level up/gold stars to get their candidate.
Did you know that IBM has a patent on auto-scrolling if you fill in the bottom line in a terminal window?
Yet another argument why software patents are so much rubbish. Hopefully the EU will continue to reject this nonsense, and hopefully our Supreme Court will eventually reject it as well.
Spare us the trouble of paying Fidelity $20 or whatever to make the trade, and just give us deferred cash bonuses because that's basically what this is.
The value will vary between when the stock is granted and when it vests - I guess you don't consider that important.
To your point, the potential range of future stock grant value probably is in the noise for most employees' financial planning. Sure enough I only look at the stock price because I have options.
We are going to move from a share basis to a value basis.
If this is true (and it may not be -- right now it's at the credibility level of "I heard it on Mini's blog") -- if this is true, it would be a very bad move indeed.
Microsoft stock should be going up. I know it hasn't been lately, but let's just say we've had a few anomalously bad years. My hypothetical 100 share grant, spread over four years, looks like 25 shares at $30, then $33 the next year, then $36 and then $40 (say). So rather than $3000, my award is worth a little more than that -- $3475, in this scenario (which excludes inflation and future time value of money).
Moving to a value basis means that I get $750 each year in four equal dallops: 25 shares at $30, then 23 at $33, then 21 at $36 and then finally 19 at $40.
Why would Microsoft do this? They're doing me no favors. The only party that seems to benefit is the company.
Or maybe they've just thrown in the metaphorical towel on our stock price?
Here is an idea for hiring from the field: FY’08 is the year of promote from within!
No more slotting. If by some chance a role is slotted, hard to break GM habbits, any employee can challenge that slot in an anonymous and protected manner. Also, any role filled by an external hire must go through a team review and win majority support of a group of peers or even directs. Finally, roles with directs should have representation from the directs in the interview loop.
Perhaps Microsoft Fanboyz exist, but aren't quite as visible. Maybe we show up to work thirty minutes early, check out a couple of Microsoft blogs over a cup of coffee at our desk, then get to work instead of spending all day on /. or somesuch. Maybe we have whitepapers to read, problems to solve, and customers to service. If that were the case, instead of fan sites, you'd have purchase orders for Enterprise Licenses.
I think you'll find it was Hamlet's mum, who "doth protest too much".
As a non-Microsoft person, I'd add that Microsoft won't get involved in a patent war with open source advocates like IBM - there can be no clean victory in that battle and Microsoft can't afford more court cases.
The uncertainty on this cuts both ways: Linux is hurt, but if other companies call in their patents, there's no doubt at all that Microsoft will be hurt as well.
This is a storm in a teacup, a comment that will be quickly forgotten by all parties. That is, unless some execs desire a war of attrition.
On another front - Microsoft has no cult following? Go to any reputable tech site and look for the people who say "I hate Apple" or "Linux suxors" and you'll see there's a cult of Microsoft. That story just isn't believable when you see what people quite openly say.
"How much I should ask for if I leave MS? I know everybody took a paycut when joining MS but now I am negotiating with a new offer also in Seattle, should I look for 30% salary bump or more?"
You are wrong, I got a pay increase coming to Microsoft, just not the 10% one I was hoping for. However, when benefits are factored in, I'm way ahead of where I would have been with a 10% raise and the same crappy benefits. Microsoft is no longer paying so poorly.
Of coarse if you have only a few years in you are probably making in the $80's ... what do you expect?
Still I wish you luck! We all benefit from wage inflation for software development!
Why is this surprising? The best rewards should always be in the riskiest/unproven areas.
>
You should have your head examined or fused with Balmer/Gate. Rewards should be for adding share holder value.
Adding risk to a safe project should not be rewarded. This happened in the longhorn project.
Microsoft's medical package is no longer that great. It was great in 1990, but not now. I work at a startup with better medical benefits (amongst other things).
Anonymous said:
> MS software is on over 90% of the worlds PC's. I've never heard of a cult comprised of the "majority".
So, by your logic, the IPod wouldn't have fanboys either.
So...just got done with the townhall...and WOW. There is nothing there. Shipping services? Like who among us wasn't already shipping things for free? To me myMicrosoft 2.0 (more like 1.01) is all about messaging. OK, so the descriptions are gone...doesn't change the low comp numbers or vast discrepancy in level comp below L65 and above. Nope...there is nothing here. This will be my last year at Microsoft. August 2008 I am GONE just after getting that bonus payout from this next round. (why not now? personal stuff, don't ask)
well mini, did you watch the town hall? was it everything you hoped for?
my eyes literally bugged-out of my head when lisa announced the *reduction* in the stock award program, which is now 100% neutered since it's based on a dollar award and not a share award, and unvested grants dialed-down as they vest if the stock price increases so that you only receive the exact $$ amount.
lisa MADE NO SENSE as she was trying to justify this as a good thing for employees -- that even though our unvested awards will no longer have any potential to increase in value that somehow we'd all be magically thrilled N E WAYZ if the stock price climbed.
why can't our executives ever learn?
why bother asking. for me, after today's cluster it's really, really time to stop fighting the good fight, admit defeat and go in search of a happier place.
No more Limited 2! I was looking forward to mini's bitch about it after this review cycle!
I had a pleasant surprise today where I work for a Large Canadian Corp. I was at a meeting with the CIO and GM. In the past we have dabbled with a few linux projects and that was all that was permitted. After the bluster from MS about "patents" there seemed to have been some reaction to it at the upper levels of the Corp. As of Today we are to start shifting to more Linux and Open Source gradually. Also Vista has been pushed to the side lines for more compatabilty studies.
Interesting times, as one person put it,IF MS is prepared to bluster at Open Source and Linux there must be something there that worries them.
On review you get the % position in your level. That % position translates now into $$ instead of # of shares. On 8/31 those $$ are converted to shares at the price of closing that day, and YOU GET THE SHARES. Then these shares vest 20%/year as before.
The change implies that now MSFT budgets exactly the $$ to distribute, instead of # of shares that moved the final $$ that would cost. It's better financial planning. For employees it's the same thing, no change.
>It's better financial planning. For employees it's the same thing, no change.
May be it is better planning but for employees it is not the same thing.
If the stock goes over a period of time, it is a bad thing for employees. If the stock goes down over a period of time, it is a good thing for employees.
The comments on insideMS regarding the new stock award plan show how retarded the few trolls that still post there really are.
Anyone that thinks employees lose if the stock price goes up is a freaking idiot.
and unvested grants dialed-down as they vest if the stock price increases so that you only receive the exact $$ amount.
Can someone else confirm this?
This is ridiculous. What is the incentive for employees to work harder to increase the stock price while waiting for their awards to vest?
"If the stock goes over a period of time, it is a bad thing for employees. If the stock goes down over a period of time, it is a good thing for employees."
You got it WRONG. On 8/31 you GET THE SHARES!!! Nobody will take the shares from you once granted... then they vest as usual, but they're the same shares.
I don't get where so many people got it SO WRONG!!... :-(
I completely missed the talk about stock compensation; fricking perfect timing for people to walk up and ask questions grr... but these days I could care less about that compensation since it sucks rocks.
What really peaked my interest, again I missed most this due to pinheads, was the question from the gentleman in the audience about some Ameri-something finacial provider. Did it sound like he was asking about a possible change to the 401K provider?
If they hire some flipping front end load based mutual fund provider to manage the 401K plan I am going to be really pissed.
With every string of comments on this blog, I feel more and more confident of my decision to leave Microsoft. I don't know who all the folks getting 30% raises are, but I took a 15% pay cut and a MAJOR hit on the benefits to get out. It was worth every dime, as my quality of life has increased more than proportionally. I ride the bus to a downtown startup instead of crossing the lake. I work with a passionate crew of folks who don't agonize over reviews.
Get out. Seriously. It's not worth it. If you are creative, energized, and team/goal-oriented, greener pastures await. Let Microsoft have the staff it deserves as a crew of sociopaths fight over the last bits of value remaining in the few maintenance projects left over now that Windows appears to be dead-ending. Sure, there's cool shit going on in dev tools and in the Server teams, but the days of the monopolies are over.
Our company meets regularly with major enterprise players in the financial sector, and these meetings confirm the sense articulated here: Office 2007 is gaining traction, but no one wants to touch Vista. It may be that Vista was a great operating system for 2000.
It really saddens me to see what Microsoft has become, because I loved my first five years there. The second five, not so much.
Based on MyMS 2.0 it's clear that bad marketing and spin has now infested our HR organization as well. It's all rebrand, retitle, 'better communication' with no substance at all. This took a year to develop? Transparency only goes up to L67, and the partners continue to reap the huge imbalanced rewards.
Looking at the comments about the change in stock awards makes me wonder how we hired so many idiots. There are people who can not understand a simple description of the change. How can you expect this people to deliver high quality software? And then they have the guts to demand better pay? They won't get hired anywhere outside Microsoft. Day after day I get this growing feeling that I'm working with a bunch of morons. Hope that I won't morph into one.
Yeah, people are overcomplicating the stock thing. It's not that hard, basically swapping money for shares, easier accounting. Basically what you want is for Ballmer to open his mouth about 2 days before the grant to dive the stock so that you get more shares.
But that's not the news. STOP TALKING ABOUT THE STOCK!!!!! There is nothing to see there. The news is that myMicrosoft 2.0 is NOTHING. It is paper thin. Most of Lisa's slides were about transparency and communication. So they're finally getting closer to telling it how it is. Gold Star transparency? Doesn't fix that absolutely discretionary and arbitrary process to get one. C'mon folks, where is the rage?
myMicrosoft is DEAD...now I'm convinced that Lisa doesn't read Mini or even her own blog. There are so many great ideas out there, but we have an HR that is sitting on their hands doing a Limited II job. Well, you know...maybe I will too.
Oh, and the guy with the long winded question about Ameriprise? Total plant. He was reading his question. Ballmer planted him to eat up time in Q&A.
Wait until Debra Chrapaty takes HR away from Brummel.
Why? What about Debra Chapraty? Is she the heiress apparent? What do you mean?
Wait until Debra Chrapaty takes HR away from Brummel.
Debra Crap-aty take over? Please. I've attended a couple of all hands w/ her as a guest speaker and I was far from impressed. Even if she were to take over it would be more of the same BS. My prediction is Lisa is getting her financial house in order (selling) preparing to bail out in the next year to 18 months.
There IS a difference with the new stock grant method.
Every good finance person will tell you that the value of any investment that you make is determined on the day that you buy and not the day that you sell.
Suppose you receive $3000 worth of stock. If the stock price is $25 on the day you receive shares and then goes up to $35 a year later, you receive 120 shares and earn $10 per share. 120 shares x $10 = $1200. If the stock price is $30 on the day you receive your shares and then goes up to $35 a year later, you receive 100 shares and earn $5 per share. 100 shares x $5 = $500. That’s a big difference. You are better off if the stock price dips on the day shares are granted!
Who is the moron HR???
BTW, did anyone walk out of the meeting today feeling inspired and motivated? I loved the question that the person in the audience asked about whether Microsoft factors in its corporate mission in making decisions around acquisitions and product decisions. The answer from Steve was so lame. You know that Bill G would have answered that question differently.
God, all this talk about the performance process. It hasn't gotten less arbitrary, just more time consuming. There used to be a program called the PIP. Remember that? I remember hearing rumours about people who were put on the PIP. My understanding is that their stock vested quickly (never sure how that was a punishment?) and they got micro-managed until they either quit or their performance improved. The current system feels like MS just put everyone on the PIP.
>Why? What about Debra Chapraty? Is she the heiress apparent?
That's the rumor that's been floated outside of MSN.
>>Why? What about Debra Chapraty? Is she the heiress apparent?
If she personally hired Wallent to be on her team, as opposed to having him put there by someone else, she's not fit to run a lemonade stand, much less an HR department.
Let's say you were given a value of $3,000. The current market rate is $30.
3,000 / 30 = 100 shares
Let's say MSFT goes down to $25.
100 shares * $25 = $2,500.
Then that means you lost $500.
In the old stock award system, I never feel that I lost money. In this new stock award system, I can get the feeling of "my shares are underwater" again.
Isn't it the purpose of shifting from stock options to stock awards is to prevent the "underwater shares" situation?
Isn't it the purpose of shifting from stock options to stock awards is to prevent the "underwater shares" situation?
Sure, it does prevent this. But it also implies that management thinks the "underwater shares" situation is likely in the future. Or they are trying to cut benefits but are trying to present it in this manner so people think they are only trying to stave off the downside. Either way it indicates management is pessimistic (or cynical) about the future, no?
(just to clarify, the above was me also) In general, we expect that the value of our shares should increase over the years that they vest. The fact that they changed this to a $ value indicates that management does not feel the same way... or that they do but they are trying to cut costs. I don't know which is worse.
Let's say you were given a value of $3,000. The current market rate is $30.
3,000 / 30 = 100 shares
Let's say MSFT goes down to $25.
100 shares * $25 = $2,500.
Let's say that you were paying attention during the Town Meeting. If you were, you'd realize that the case you describe won't happen. The actual scenario is:
Let's say you were given a value of $3,000. The current market rate is $30.
3,000 / 30 = 100 shares
Let's say MSFT goes down to $25.
120 shares * $25 = $3,000
You always get the same dollar amount -- the number of shares is adjusted based on the stock price at time of purchase.
What people seem to be missing about the change in the stock award policy is that the dollar value of the award is not planned to change with stock price movements. If your target level is $30K at $30 you will get 1000 shares while if next year the price is $40, assuming the same performance, you will only get 750. The shares from previous grants would have appreciated but compared to the old program your award at the time of granting will have a dollar equivalent which is 10K less.
To understand this imagine a very simple world where the stock price in year 1 is $30 and in year 2 it is $40. The price in subsequent years remains constant at $40 and you are not granted any more shares. Assuming the same performance in year 1 and year 2, under the old scheme you have a grant of total of 2000 shares while under the new one you will get 1750 (1000 in year 1 and 750 in year 2). The first batch of shares vests in year 2 and all shares are vested by year 7. Assuming the shares are accumulated, the value in the old scheme at year 7 is 2000 x 40 = 80000 and under the new scheme it is 1750 x 40 = 70000.
Regarding the software patents, are they valid anywhere outside of the US? Also, it is more than a little suspicious that MS won't just come out with a list of the specific ones... If the patents aren't bogus (e.g. would get tossed if a lawsuit were ever actually brought) or easily circumventable, why not just disclose which ones they are?
As far as the apparent lack of a Windows 'cult' goes, think about the last time Windows inspired you with awe. When using it was a joy. When you didn't fear that malware was lurking around every corner, stalking you. When you actually felt like you were in control of your own system.
Its been a while for me; I think that was early on in my usage of Windows 98. Using Windows XP became an exercise in paranoia.
Right now I use Ubuntu Linux. I'm happy again :) When new releases are made there's always something spiffy to find. It has a buzz of enthusiastic energy like some frontier town that's growing extremely rapidly after gold was found in a nearby stream.
Bill Gates promised a 'wow' with Vista, so I went to Staples and had a look when they came out. My response was more of a 'meh'. "Wow" is booting up a Live CD to play with with 'wobbly windows' and the 'burn down' minimize effect. "Wow" is using Synaptic to install programs for the first time. "Wow" is reading the back of the CD sleeve where it says "You are encouraged and legally entitled to copy, reinstall, modify, and redistribute this CD for yourself and your friends"
Things like that add up for a nice user experience :)
My Mac user experience is limited, but I can see how, for less technically-oriented people, it would be a great OS and have a lot of awe-inspiring moments too.
I think a good example of how tepid an experience Windows has become is summarized in the story about how many people were involved in creating the Vista shutdown menu:
http://moishelettvin.blogspot.com/2006/11/windows-shutdown-crapfest.html
Of course, I think your feelings about the number of people working at MS and the bureaucracy it spawns are well known ;)
Why no fanboys? Are you serious?
- Microsoft Licensing - Kafka would love it
- WGA and activation - inconvenient (at best) for customers/enthusiasts/honest people who would pay anyway, amusing (and harmless) to crooks
- "me too" - constant not-quite-as-good copycatting... nobody roots for the envious latecomer, try doing something cool & original for a change
- Patches to the patches to the patches - 'nuff said, see last Tuesday's 100% CPU patch bug...
- Jackass executives and tradeshow droneclones who apparently are programmed to wear identical khakis and shirts and say "super" every third word
- Malware and viruses - who do you know who *hasn't* had a problem in the last couple of years?
- Vista
- dorky awful product names - Windows Live Messenger, Windows Internet Explorer, and so on - nobody thinks that's cool, it smacks of naming-by-committee. Silverlight - not bad.
- you're the borg. Bad impressions/experiences get spread around; good ones don't.
- sore loser: patent nonsense (maybe we will, maybe we won't... executive mumbo-jumbo), accusing Google of antitrust (are you serious??? pot/kettle)
- plus in all fairness very few people root for the overdog, that's just human nature
I was really dissapointed that they have decided to fix amount of awards in a form of cash value. Previsouly I could expect that while stock is moving up my grants value would be moving up as well. Now - it's basically a seniority bonus only and has nothing to do with company's overall performance.
My Mac user experience is limited, but I can see how, for less technically-oriented people, it would be a great OS and have a lot of awe-inspiring moments too.
For more technically-oriented people, too. The deeper you get into the arcana of Mac OS X the more fun you have. The nimble way it handles swapfiles, fragmentation, virtual memory and permissions; the versatile and flexible command-line application; the cleverness of the near-total graphics offload to the video card (while maintaining 100% full-speed compatibility with older machines); the transparent fat binaries; the X-Window implementation; etc. etc., the centralized modules for "core graphics"; "core MIDI"; QuickTime etc. are all very nice. Basically it's like the clever design on the surface -- the part "Grandma" sees -- is reproduced throughout.
Nothing wrong with what you said; I just wanted to add that it's fun all the way down.
"So, by your logic, the IPod wouldn't have fanboys either."
I don't know, how does an iPod fanboy behave?
"The change implies that now MSFT budgets exactly the $$ to distribute, instead of # of shares that moved the final $$ that would cost. It's better financial planning. For employees it's the same thing, no change."
I think you are only partly correct. There is a very strong message in this change. The upper management believes are stock is going to be headed up. If they though it was goint go continue to slide, it would be better to stay with the old system.
I think the point many people are missing about the change from reporting by dollar value as opposed to number of shares is that it's all about perception. It's clear that MS execs believe the comp model (salary + stock + benefits) is very competitive and that they have a perception problem. In their view people don't understand the amount they are "really" making. I expect to see a lot more "transparency" and trumpeting of the value of our total compensation, with little to no change in actual comp.
The thing execs are missing is that the total package doesn't have the same perceived value across the entire employee base. For example, nearly all college hire don't give a shit about maternity/paternity leave, while older people with kids on the way or at home get a better "deal" because the health benefits have high value to them. Unfortunately, there's not really an effective way to address that difference, other than only hiring people of a certain age and tailoring things to them. Overall, I think comp at levels less than 64 or so probably needs a bump (10-20%), while 65+ is probably ok from a competitive standpoint.
I'm sorry but how can there be any ambiguity at all (let alone repeated confusion and recriminations) on this blog regarding the change in stock policy?
Aren't the posters here all involved in, you know, the software industry? Like, routinely dealing with ordered structures that generate quantifiable results?
Aren't the posters here all involved in, you know, the software industry?
Relax, they're the same people who have been complaining about getting Limited 2s and are going to wind up in the 10% bucket shortly. They won't be here much longer.
Man, I am amazed that so many people here misunderstood the math of the Stock Award change. (sigh) Well, more than enough folks have tried to correct misunderstanding here, so I won’t try myself.
What I don’t get is no one is incensed by Lisa’s slap-in-the-face to MS employees. She said that based on MS Poll numbers, so many people are not happy with their “package/salary/bonus”, etc. So what is HR’s answer to this? Why, not to fix the package, but to ‘splain it better to you.
Oh… why thanks, Lisa. What I wanted out of my “package” what just to understand it better, not a better package. Thanks for clearing that up for me.
Jumped the shark, “MyMicrosoft” has fer sure.
Someone said:
MS software is on over 90% of the worlds PC's. I've never heard of a cult comprised of the "majority".
I have. It's called Christianity.
So now basically we all have to cheer for the stock to go down at the end of August, then cheer for it to go up for a while, then back down, etc.
But what I thinks blows even more is that the Safeway grocery delivery is gone. How can they take that away!!!
Well at least I can still get my dry cleaning done. My life is still complete.
I did the spreadsheet that mini mentions.
If you only get one stock award, the two systems are equivalent since the mapping of what you are awarded to number of shares only happens once, at one price.
But it makes a difference if you get a stock award every year.
Assume you get the same dollar value of award every year under the new system versus getting the same number of shares awarded each year under the old system. For example, $3,000 worth of shares each year [new] versus 100 shares each year [old].
If the stock price rises over those years, you will have an accumulative number of shares in the new system less than what you would accumulate in the old system, therefore, those shares would be worth less value.
If the stock price falls over those years, you will have an accumulative number of shares in the new system greater than what you would accumulate in the old system, therefore those shares would be worth more value.
This means that the upside for the stock price rising is less in the new system, but that the downside for it falling is also less: falling stock price doesn't hurt as much; raising stock price doesn't help as much.
The way to make the two systems identical is to tie the target Award Value to stock price each year, so that this year, if the stock price is $30 and they set the target value to $3000, then next year, the target value should be set to 100 times the current stock price. This basically ensures that the target is 100 shares, it just gets translated into $ and back to shares, theoretically an identity transformation.
There is a complication, however. The target value is set before August 31st when the conversion factor for dollars to shares is set. For example, this year the target value is set to last year's target shares times $30. If the stock price is lower on August 31st when they calculate how many shares you get, you get more shares than the assumption of $30 per share would have given you; conversely, if it's higher, you get less shares. This is similar to the ESPP setup, where you hope the price is low on a certain day, but that it goes up from there later when you want to sell shares [then low for the next magic day, etc.]
One thing is that if the go with a dollar amount it will be easier to think about. If I get 3,000 this year and revenue next year is up 67%, shouldn't I expect to get that much more?
Also, yeah, them just explaining to us out compensation package better. Man, so let's see. We know the "overall package" numbers are bad on MSPoll, are they really going to try and say it is because people don't understand their packages and not becuase they really have a gripe here?
It isn't a shock though. They have stated over and over again that they WILL NOT give out more money. So for transparency, at least we were given that. I guess I'll just keep an eye on the insider trading and watch her "deal" play out. She is selling and that's at least interesting.
What do Chrysler, Bausch & Lomb and Microsoft have in common?
One is now gone private, the other is going private and the last one will go private. . . soon.
What do Steve Ballmer, Bill Gates and Brad Smith have in common? Most notably, they have ruined a pretty good company by first thinking the big bang approach would work, second by believing that spending six billion dollars equates to good judgment and third by believing that somehow a legal department and a lawyer should be pro-actively involved in defining a software company.
And you thought I was going to say they all have criminal records.
http://www.thesmokinggun.com/archive/gatesmug.html
"What do Steve Ballmer, Bill Gates and Brad Smith have in common? Most notably, they have ruined a pretty good company...
i'm as much a steve hater as the rest of the rational world, but let's not forget that steve and bill -- if they've ruined anything -- have ruined their company, not a company.
they've made some spectacularly bonehead moves over the years, and it's really time for steve to move-on. that said, there wouldn't be a monstrously massive company if there was no bill and steve, so keep it in perspective. :P
Hi Mini, I worked at MSFT 3 years, leaving last year for the entrepreneurial life. I have something that may help with your spreadsheet question:
http://instacalc.com
You can link to a quick, *anonymous* calculation, fitting for this blog, using readable numbers like "sales = 300 million + 10%", etc. Hope your readers find it useful when computing their new stock award numbers.
there wouldn