JACOBS BRANDING GRAPHICS & WEBSITE DESIGNS

Microsoft – A Look at Strategic

Human Resources

Holley Jacobs

JACOBS BRANDING GRAPHICS & WEBSITE DESIGNS MARCH 7, 2015

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Abstract
This research looks at how strategic human resources management has affected Microsoft as a company.
Through the research process our team used several qualified articles, journals, books and the Microsoft
website. Our team will discuss SHRM topics including religion and the workplace, learning and development,
and retention and engagement. We will also include recommendations to Microsoft executive board based from
our research. Microsoft has made strides in the business world to be one of the leaders in technology and our
research will show how they have maintained that title and how they will continue to be successful in an ever-
changing world.
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Introduction

Microsoft Corporation was founded in 1975 by William H. Gates III. Their mission is “enable people
and businesses throughout the world to realize their full potential” (Microsoft Corporation - 2011 Annual
Report, 2015). Microsoft Corporation is in a very competitive field – information technology and software.
They are in Redmond, Washington, are a public company and offer a plethora of employee benefits including
health insurance, work-life balance, diversity, training, and health. Microsoft Corporation rank 72nd on Fortune
100 list and is listed as 86th on Fortune’s Best Companies to Work For 2014 (2014 Best Companies to work for,
2015).

Retention and Engagement

Employee engagement and retention is a critical aspect of strategic human resources

management and is becoming increasingly more important for sustained business success. From an
organizational point of view, employee engagement can be defined as “someone who feels involved,
committed, passionate, and empowered and demonstrates those feelings in work behavior” (Bhuvanaiah, 2014,
p. 62). Microsoft, in more recent years, has integrated an HR approach into their overall strategic business plan
and has remained “one of only thirteen companies to be included on Fortune Magazine's annual list of the “100
Best Companies to Work For” every year since the list began in 1998” (Corporate Citizenship, 2015). Although
Microsoft has been recognized as a great employer to work for, its employee focus was not always leading their
business directives. In the 90’s, even though Microsoft maintained a low turnover rate, they were losing some
of their top talent. These employees, who received excellent training and financial stability from Microsoft,
were not leaving for a competitor, but they were venturing off to start their own businesses due to Microsoft’s
incredibly fast growth while starting to lack distinctiveness. Nathan Myhrvold, former Microsoft employee
stated “there seemed to be a pervasive feeling that Microsoft's size is hurting it in important ways. Microsoft
has grown to the point where process has become as important as outcome” (Nocera, 2000, para 21).
Now, in 2015, Microsoft states their “current success is based on the drive of their 100,000 employees
and to continue their success they believe they “have a responsibility to create a respectful and rewarding work
environment for them” (Corporate Citizenship, 2015). This responsibility is the essence of employee
engagement and it focuses on the valuation of human capital. Human capital is considered one of the 5 types of
organizational assets evaluated to help increase business performance. However, due to the difficulty in
measuring the value of human capital, it is often overlooked as a possible solution to organizational change
(Mello, 2015). Organizations that have established a strategic human resources approach such as Microsoft,
have experienced not only impressive retention rates but also business success.
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Implementing engagement practices create employees who are more energized to produce quality work
resulting in a higher level of company loyalty (Lockwood, 2007). In its earlier years, Microsoft engaged its
employees by allowing and inspiring an entrepreneurial spirit and a sense of empowerment but as it grew,
individual responsibility was lost.
Research shows there is a distinct connection between engagement and employee retention. Retaining
top talent is a significant goal for most organizations due to the high cost of turnover and the loss of investment.
Businesses suffer greatly when they invest in the development of their staff to then lose them to a competitor.
Research suggests that “direct replacement costs can reach as high as 50%-60% of an employee’s annual salary,
with total costs associated with turnover ranging from 90% to 200% of annual salary (Alen, 2006, p.3).
There are many reasons why people leave their place of employment but close spaced organizations who
take a strategic approach to understand why people leave, can also gain a better idea of why people stay and can
learn how to influence these decisions (Alen, 2006). Microsoft’s energized focus on people has helped regain
and build their employee engagement practice whereas now they boast “85% of employees would recommend
Microsoft as a great place to work, 93% percent feel they are treated with respect and dignity by their managers,
and 94% percent feel Microsoft is a good corporate citizen in their communities and around the world”
(Corporate Citizenship, 2015).
Learning and Development

Learning and development also known as training and development of employees are a key strategic issue
for organizations. It is how organizations determine the extent to which their human assets are viable
investments (Mello, 2015). Learning and development programs have always had a vital role to play in helping
any businesses survive and thrive for success. Learning and development programs help organizations build and
maintain internal capabilities, so they can successfully execute their work plans. For these programs to work
they must include:

• The identification of key employee skills and abilities and the methods for teaching and acquiring them.

• Training program design and delivery.

• Leadership assessment and development programs.

• Internal and external executive coaching.

• The metrics used to assess each of these programs. (Fee, 2011)

Learning and development programs help organizations by improving the daily routine of the
organization by giving employees the skills needed to excel. These programs also reduce external hiring
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costs by evolving and developing internal employees and preparing them to take on greater leadership roles.
Learning and development programs increase employee preservation by visibly demonstrating to the employees
an investment has been made in their career for development and growth (Fee, 2011). Employees who
constantly require change will value a company that offers training and development programs, they understand
that these programs keep them sharp in the workforce.

Through forty years of success Microsoft has incorporated their learning and development program
giving employees the necessary skills and knowledge to be part of an ever-changing company. Microsoft is a
leading technology company that understands that many of their employees don’t have time to sit in a
classroom after being in the office all day, so to help employees continue to evolve they offer Microsoft Virtual
Academy. Microsoft Virtual Academy is for to Microsoft employees where they can learn something new or
obtain refresher issues. Being that Microsoft is a global company, employees are given a sign in key, which
directs them through different pages on the site, which includes live training classes, product and service
training, and web development courses offered in 14 different languages (Microsoft, 2015). Microsoft also
shows its competitive edge by showcasing the top students in the course through a point system. Currently, over
two million students have registerd for training.

Microsoft not only offers training for employees but they offer training and development for customers
as well. Microsoft has dedicated a site called Professional Development for Educators, this site offers training to
teachers and other educators on how their services work and how to incorporate them into the classroom. They
offer a certificate of completion once training has been completed to show that the educator has completed all
assessments and understands the material. Through the many pages of this site teachers can choose to join a
virtual learning classroom or assign an onsite professional to join their school for learning and development
training (Microsoft, 2015).

Technology changes daily, once you learn how a service or product works, the new version has already
been developed and sent to the shelves. Microsoft leads in that ever-changing technology process and
understands that learning is a lifelong process and that is why they offer many developing tools for employees
and clients. I feel as though they encourage their employees and customers to be lifelong learners as well.

Microsoft Diversity and Inclusion Training:

Making Accommodations for Religion and Spirituality in the Workplace

U.S. society has addressed many multicultural concerns of various constituencies including
certain racial and ethnic groups, women, families, and homosexuals. Successful firms have confronted such
societal movements by proactively addressing the concerns of these various employee groups and their
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respective rights and needs in the workplace. The recent societal interest in religion and spirituality has resulted
in faith and religious beliefs becoming the most recent type of diversity concern in the workplace (Von Bergen,
2013).

Because of the recent increase in religion and spirituality issues in the workplace, discrimination
lawsuits have increased significantly. Additionally, large percentages of workers, primarily those in the
younger generations seem to have changed their views of what the workplace landscape should consist of,
especially regarding spiritual and religious practices (Lavelle, 1999). In preparation for these growing trends
sufficient knowledge is needed to reduce litigation and to make appropriate accommodations for employee’s
religious practices.

In response to these very important issues, Microsoft is providing its leaders with cultural competency
training and strategies for managing global diversity and inclusion best practices. They also offer a robust
portfolio of diversity and inclusion training courses for all levels of employees and leaders around the world
(Microsoft, 2015). Key courses include Managing Inclusion™, Building an Inclusive Culture: Understanding
Conscious and Unconscious Bias, Cultural Dexterity™ and Consulting for Diversity Hiring developed
specifically for our international HR and staffing teams focused on gender diversity (Microsoft, 2015).

Because Microsoft is dedicated to offering its leaders extensive training in the areas of diversity it has
already taken the necessary steps to ensure that all its employee’s specific religious and spiritual beliefs will be
welcomed and accommodated for. Cultural dexterity represents an advanced approach to cultural competence
required in today’s diverse global business settings (Microsoft, 2015).

Rather than a static learning specific to only one national, ethnic, generational, or other group, Cultural
Dexterity combines cultural knowledge, emotional intelligence, and interpersonal skills that can be adapted to
achieve improved business results in any cross-cultural situation (Microsoft, 2015). Developing such abilities
throughout organizations, but particularly among leaders, is crucial to companies that must retain top talent
around the globe, optimize team performance, and grasp the subtleties of new market segments (Microsoft,
2015).

Another concern that has been discovered through studies is that many people feel that they must
separate and compartmentalize significant parts of themselves at work and some want to keep certain things
private, which they share with no one. This seems to be due to the fear that if certain areas of their lives such as
their religious and spiritual beliefs are known it will cause them to be shunned or even discriminated against
(Mitroff & Denton, 1999). The same article found that most people wished ardently that they could express
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their spirituality in the workplace but as stated above, felt hesitant because they had strong fears and doubts that
they could do so without offending their peers (Mitroff & Denton, 1999).

From those surveyed or interviewed by the author (Mitroff & Denton, 1999) approximately 30 percent
of the participants had positive views of religion and spirituality, 2% had positive views of religion and negative
views of spirituality. About 60%, or the majority, had positive views of spirituality and negative views of
religion; 8% had negative views of both religion and spirituality. John, one of the interviewees and the CEO of
a major social service organization had this to say about religion and spirituality: “For me, the essence of
spirituality is connectedness with everyone and everything in the universe, to the whole of humankind and the
physical universe itself. It is feeling the awe and the mystery of being. It is also knowing that there is a
supreme being or higher power that guides everything. I believe strongly that religion should not be discussed in
the workplace (Mitroff & Denton, 1999).
On the other hand, I believe not only that spirituality can be discussed in such a manner without dividing
people, but that its discussion is key if we are to create and maintain ethical, truly caring organizations. All
organizations, for-profits as well as not-for-profits, need to learn how to harness the immense spiritual energies
of their members if they are to become ethical and profitable over the long haul. Any organization can make
money in the short run by exploiting and maltreating its employees, but if it wishes to be profitable over the
long haul, then it needs to learn how to become spiritual.” (Mitroff & Denton, 1999).

Prior to the 21st century U.S. society considered inappropriate to bring religion into the workplace, but
recently faith and spirituality have come into the workplace and this phenomenon, the “last taboo in corporate
America” is rapidly disappearing. This has caused employers to balance the firm’s and employees’ rights to
express their religious beliefs and values while not subjecting other employees to harassment or discriminating
against employees based on different religious beliefs. Such tensions have surrounded the latest type of
diversity that firms must address—God at work (Von Bergen, 2013).

Recommendations to Managers

There are at least three human resource imperatives to ensure that SHRM practices will continue to
support the primary mission of Microsoft; 1) Continue to evolve new systems of human resource practices that
support its future growth and competitiveness 2) Provide immediate assistance to areas in the process of
organizational change and 3) Maintain its current operational function of central HR. Specialization is crucial
in this process and the following recommendations should be carefully adhered to assure success in SHRM
functions.
For human relations teams, redesign and/or establish human resource practices to ensure their
applicability to both individuals and teams, re-think and implement job designs and a classification system that
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support competencies and roles to accomplish work. Implement efficient, flexible hiring and transfer processes
based on roles and competencies to facilitate movement to and from assignments, roles and responsibilities.
Institutionalize a system to reward and recognize employees for their contributions, which both ensures equity
across the Institute and encourages creativity at the "local" level.
For performance evaluations be sure to build on the existing performance planning and monitoring
process for individuals and implement a similar process for teams. Implement competency-based assessments,
development and training processes to promote flexibility and growth and implement an annual strategic
planning process to support the staffing needs of academic departments, centers, and administrative areas as
well as the institute's broader mission. Finally, implement an annual strategic planning process to support the
staffing needs of academic departments, centers, and administrative areas as well as the Institute's broader
mission.

Conclusion

Strategic human resource management incorporates a business’s most important asset, its people, into its
overall strategic mission. Microsoft recognizes people are the driving force behind business success and they
are committed to attracting, developing, and retaining top talent. Over the past twenty years “economic
pressures, multigenerational workforces, and advances in technology have evolved Microsoft’s HR role into a
crucial strategic role within the enterprise” (Microsoft, 2014). As the global market continues to flourish,
continual review of SHRM practices will call for redesign and implementation to address new trends and new
social concerns. Microsoft’s distinguished awareness in its people and SHRM initiatives will continue to help
advance their industry success.
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References

Alen, D. (2006) Retaining Talent: A guide to analyzing and managing employee turnover. Retrieved from
http://www.shrm.org/about/foundation/research/documents/retaining%20talent-%20final.pdf
Bhuvanaiah, T., & Raya, R. P. (2014). Employee Engagement: Key to Organizational Success. SCMS Journal
of Indian Management, 11(4), 61-71.
Corporate Citizenship. (2015). Retrieved from Microsoft Web
site:http://www.microsoft.com/about/corporatecitizenship/en-us/working-responsibly/principled-
business-practices/our-people/
DailyFT (2015). What’s next: The role and future of HR. Retrieved from: http://www.ft.lk/2015/01/23/whats-
next-the-role-and-future-of-hr/

Fee, K. (2011). 101 Learning and Development Tools : Essential Techniques for Creating,

Delivering and Managing Effective Training. London : Kogan Page.

Lavelle, J. (1999). The spirituality of work. Life Association News, 94 (2), 130-131.

Microsoft (2015). Global Diversity and Inclusion. Retrieved from: http://www.microsoft.com/en-

us/diversity/business-of-inclusion/default.aspx#fbid=Q8IYYOskDGR

Mircosoft. (2015, February). Facts about Microsoft. Retrieved from Microsoft:

http://news.microsoft.com/facts-about-microsoft/#EmploymentInfo

Microsoft. (2015, February). MVA. Retrieved from Microsoft Virtual Acadamy:

http://www.microsoftvirtualacademy.com/

Microsoft. (2015, February). Professional Development. Retrieved from Microsoft in Education:

http://www.microsoft.com/en-us/education/training-and-events/professional-

development/default.aspx#fbid=3mKnZlhKw8s

Mitroff, I. I., & Denton, E. A. (1999). A Study of Spirituality in the Workplace. Retrieved from:
http://sloanreview.mit.edu/article/a-study-of-spirituality-in-the-workplace/

Nocera, J., & Wheat, A. (2000). I Remember Microsoft. (Cover story). Fortune, 142(2), 114.
Von Bergen, C. W. (2013). God in the Workplace. Culture & Religion Review Journal. 2013, 2013(1), 111-
126.