How Its Great Workplace Helped Steer Microsoft through Challenging Times

Paul Rellis, Amy Lyman, John RyanThis article first appeared on the Great Place To Work website in March 2012.

Navigating a company of 1,200 employees through the worst economic downturn since the Great Depression is no mean feat. That it should win Ireland’s Best Large Workplace for 2012 — its fourth victory in a row — might seem miraculous. But the process of becoming, and staying, a Great Place To Work (GPTW) is exactly what gives a giant like Microsoft the flexibility to respond to market pressures, according to Paul Rellis, CEO of Microsoft Ireland.

Speaking at the Great Place To Work 2012 Conference in Dublin, Rellis told of the strains faced by the Irish operation during the recession. Costs per head, which were 40 percent less than the U.S. eight or nine years ago, began to creep up, he said. Four years ago, they had surpassed American costs. That put the Irish operation on a par with Switzerland and made it very visible to accountants back in corporate. “It was a crazy situation,” Rellis said.

Costs per head are closely tracked in all of Microsoft’s global operations, and Ireland’s exposure was worrying. “If costs are growing faster than revenue, it’s a major problem.” Meanwhile, Microsoft was looking at a rapidly changing environment. Digitisation, transparency, more choice, and rationalization of capital were among the many trends identified, said Rellis.

To get back on track, management engaged the workforce. One part of the process included company meetings to explain the financial situation. Meanwhile, in a very structured, “non-threatening” environment, staff were asked about how they felt the company was run. “We got incredible feedback,” Rellis said.

One of the big changes the workforce saw was a move to an open-plan office. It brought “a big improvement to the vitality of the organization” and increased camaraderie, Rellis said. Initially there were worries about confidentiality, but then Rellis realized, “I don’t have that much confidential stuff and everyone knows everything anyway.”

Meanwhile, the financials improved. Microsoft was using 30 percent less space, which was a large cost reduction in itself, Rellis said. Travel went down by 25 percent, and employees concerned about the environment were gratified to find out that CO2 emissions were down by a fifth. Yet both employee satisfaction and the all-important customer satisfaction ratings went up.

Rellis attributed his ability to steer Microsoft Ireland through challenging times to its GPTW high ranking. “It’s not some fluffy, nice to have concept,” he said. “It is really good for our business.”

Image courtesy of GPTW. From left: Paul Rellis, Microsoft; Amy Lyman GPTW co-founder; John Ryan, CEO GPTW Ireland.