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How Microsoft Hopes to Change Its Old-School Ways, Beyond Cutting Jobs

Top executives Terry Myerson and Scott Guthrie are leading an effort to revamp the company's tools and processes for writing software.

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While the bulk of the 18,000 Microsoft job cuts are coming from the former Nokia operations, more than 5,000 are coming from within the traditional ranks of the company as Redmond looks to revamp the way it builds products.

Satya Nadella has alluded to a new way of engineering in both his long memo last week and in subsequent interviews, but we’ve managed to get a little more detail on the practical implications of the shifts he envisions, as well as how those relate to the cuts announced earlier on Thursday.

Historically, Microsoft has been a series of product silos, largely developed in isolation, with most updates coming through larger releases developed over several years. That has been shifting in recent years, as the company has transitioned several products to also be available as more frequently updated online services.

However, in many parts of the company, engineering still works as it did in the old days, with each product team composed of a triad — with one group planning features, another writing the code and a third unit doing the testing.

The units, including Windows, that had been doing things this way may feel Tuesday’s cuts particularly sharply — especially in testing.

Microsoft insiders stress they aren’t doing away with testing, just moving to a broader definition of the function. However, the company is shifting some responsibilities for finding bugs back to those writing code, which means that those testers with traditional bug-hunting skills could be among those left on the outside looking in.

Beyond changing the organizational structure, Nadella is also pushing Microsoft to modernize the tools it uses to develop and manage code, again looking to break down the company’s silo nature in favor of processes that allow groups to work together more easily.

Overseeing those efforts, Re/code has learned, are operating systems unit head Terry Myerson and cloud and enterprise division lead Scott Guthrie.

Nadella says the changes are a key part of helping Microsoft be more competitive.

“In order to deliver the experiences our customers need for the mobile-first and cloud-first world, we will modernize our engineering processes to be customer-obsessed, data-driven, speed-oriented and quality-focused,” Nadella said in last week’s memo. “We will streamline the engineering process and reduce the amount of time and energy it takes to get things done. You can expect to have fewer processes but more focused and measurable outcomes. You will see fewer people get involved in decisions and more emphasis on accountability.”

Specifically, he said the company needed to cut down the layers involved in building products.

“Software engineering will evolve so that information can travel more quickly, with fewer breakpoints between the envisioning of a product or service and a quality delivery to customers.”

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