The Turn: Experienced Talent Always Has Options
Why voluntary buyouts are not a layoff panacea
Welcome back to The Turn. Today, we’re talking about the exciting world of worker buyouts.
Microsoft is offering roughly 7% of its US workforce the option to retire early. The eligibility formula, age plus years of service totaling 70 or more, effectively targets its most tenured (and expensive) employees.
Buyouts aren’t exactly new. If they were a cure-all, every newspaper in the country would be thriving. I am told that is not the case, though.
While it is a novel solution in the tech industry, I’ve always had a problem with a voluntary buyout, even a targeted one.
The biggest issue: Voluntary programs don’t let companies choose who leaves. They let employees choose, and employees optimize for their own interests, which is reasonable but also entirely at odds with what the organization needs.
The employees most likely to accept the package are the ones with the strongest external options. They might have decades of enterprise relationships, networks, and a resume that does a lot of heavy lifting. Some will land at competitors. Some will start something.
Microsoft’s exit package becomes their runway.
The ones who decline are a more complicated group. Some are committed to seeing the transformation through. Some already tested the external market and didn’t like what they found. Some know they have topped out at Microsoft and want a few more years of their top earnings in their retirement accounts.
All of these are good reasons. For the employee.
Microsoft doesn’t get to distinguish between those outcomes. Layoffs aren’t inherently strategic, but they can certainly be that if done well. You make projected cuts based on the skills you need going forward, and you sell the people who you chose on why they are so needed.
Targeting their oldest and most experienced employees is also a gamble. These are the people who remember how the last several platform shifts actually played out inside a large enterprise. Not how they were announced, but how they actually went. They also have customer relationships that predate their current skip-level. They know which problems are structural and which are noise, which escalation paths work, which internal fights are worth having.
That knowledge isn’t in a knowledge base. It isn’t recoverable from a well-constructed prompt. It lives in specific people, built over years of being inside a specific organization.
Microsoft is betting AI absorbs what leaves or that what they actually need is a fresh start with fresh ideas.
That bet could very well pay off at the task level and maybe even a beyond. The judgment layer is a harder problem, and the people who carried it are now taking calls from recruiters.
What else is happening this week
The AI Labor Debate: Three Views on the Future of Work. Carnegie lines up an optimist, a skeptic, and a muddier middle ground on what AI does to work, and the honest read is that all three might be right at the same time.
Why Career Sites Are the Future of Recruitment. Matt Charney finds the gems in the thing recruiting teams love to complain about most. The case for owned channels over borrowed ones isn’t new, but the specifics here make it stick.
Shaker RM Is a Stevie Award Winner. Congrats to Gina Alioto and the whole Shaker team on the Stevie win.
The Talent Time Machine, Episode 16. Marissa Geist and Jason Scheckner dig into what it actually takes to break IT and HR out of their respective silos. Good conversation on the structural reasons this problem persists and what it costs when it does.
MrBeast’s Company Sued for Alleged Sexual Harassment, Wrongful Termination. The excuses cycle through the same predictable rotation: startup energy, fast growth, isolated incidents. At some point the pattern is the story.
The Market Isn’t Pricing Your Numbers, It’s Pricing Your Narrative. Steve Smith breaks down why ServiceNow and SAP command the multiples they do while Medallia doesn’t, even when the underlying numbers tell a messier story.
Anthropic’s 81K Economics Research. Anthropic drops more research on AI’s economic footprint. How are CEOs so low on the displacement list, given that some of them are already running multiple companies at once?
SkillCycle CEO & Founder Files Federal Lawsuit Alleging Predatory Takeover, Fraud, and Retaliation. Kristy McCann is fighting to take back the company she founded in an unusual way: in public. We usually only hear about this at networking happy hours at conferences.
What’s Stalling AI Adoption in HR. Uncertainty about cost is doing more to slow AI adoption in HR than uncertainty about capability, says Stacey Harris.
How Your Hierarchy Ensures Eventual Failure. Michael Carden taps into the structural reasons well-designed organizations eventually collapse under their own weight. Harder to dismiss than the usual org design takes.
Intrateam IC Newsletter. If you’re doing digital transformation work inside a large organization and you’re not subscribed to Kurt Kragh Sørensen‘s Intrateam newsletter, fix that ASAP.
Culture King at 30,000 Feet: Lessons from Shawn Achor at Total Rewards. Tom Short has a solid set of takeaways from Shawn Achor‘s session at WorldatWork in San Antonio. If you weren’t there, this is the next best thing.
Your AI Prefers Itself. Steve Levy breaks down what happens when AI systems favor AI-generated content in recruiting, where the entire point is evaluating actual humans. Quiet problem, loud consequences.
Your HR Tech Stack Is Being Rebuilt Around You. Do You Have a Voice in It?. George LaRocque brings the marketscape data into a conversation HR leaders need to be in. The stack is getting rebuilt with or without them, and that’s the problem.
So Many Vegas Visits, Still So Few for Fun. Rob Pegoraro captures why Vegas is essentially a different city depending on why you’re there. It’s been a few years since a trip that wasn’t for an event, basketball included, and this one resonates.
The Reinvention of Workday: From System of Record to Platform of Agents. Josh Bersin unpacks what Workday is actually building toward: less the place where HR data lives, more the foundation for AI agents working on top of it.
More Output, Less Meaning: How AI Is Changing Day-to-Day Work. Interesting research on AI and workplace meaning, brought to you by the company that makes your business cards.
Have a great rest of your week!
I once managed a voluntary program, and you are right. The hardest part of managing it was getting managers to understand they could neither encourage or discourage employees in their choice. As an individual who had some significant institutional knowledge and planned to accept the buyout, I found that my leaders honored that and conveyed best wishes. For eighteen months they also had me documenting a lot of what I knew in some particular topics, and sharing that with some key employees who were staying. It all depends on how it is structured, and how much time you are allowing between acceptance and exit. The company can put some guide rails on that. But what remains is still a gap, and many employees who wish they had been eligible and are hoping there will be another window someday.