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Ballmer: Let’s Cut Costs, Raise Salaries

Today’s Wall Street Journal reports that a company-wide memo to employees from Microsoft Corp. president and CEO Steve Ballmer requests that executives begin implementing cost-cutting measures while at the same time calls for raises in base salary for key employees in an attempt at better retention rates.

The memo was distributed on Thursday, the same day Microsoft announced it fail to meet revenue and profit predictions for its second quarter.

The Journal reports that in the memo, Ballmer wrote, “We all have a big incentive as shareholders to reignite the kind of cost-conscious culture that marked Microsoft’s earlier years.”

In the memo, Ballmer acknowledged that the recent precipitous drop in Microsoft’s stock price makes “employees, new and old, more sensitive to cash compensation.” The Journal reports that to help the company recruit and retain top talent, Ballmer said Microsoft will “invest significantly” in base-salary raises for some high performing employees.

The seven business priorities laid out in the memo are Windows operating systems; productivity software, such as Office; enterprise sever products and tools; the Microsoft Network; applications for small businesses; products for non-PC devices; and the .NET initiative. According to the Journal, Ballmer emphasized the importance of both Whistler and Office 10 in the memo, as well as disclosing a new version of SQL Server, code-named “Yukon.” – Isaac Slepner

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.

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