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Technology Stocks : How high will Microsoft fly?
MSFT 487.55+0.1%Dec 30 3:59 PM EST

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To: johnd who wrote (52238)10/26/2000 3:00:16 PM
From: DiViT  Read Replies (1) of 74651
 
Some dot-commers back at Microsoft

www0.mercurycenter.com

BY KRISTI HEIM
Mercury News Seattle Bureau
REDMOND, Wash. -- Only a year ago, Microsoft Corp. was bemoaning the flood of employees to Internet start-ups. Now that the dot-com bubble has burst, the company is getting its revenge by hiring some of those same employees back.

Several hundred people have returned to the Microsoft fold over the past year -- almost double the number from the year before, the company says. That's due in large part to the exodus from sinking start-ups.

``We keep our eyes open anytime we see dot-coms fail,'' said Deborah Willingham, vice president of human resources. ``It's been a good source for us.''

The company is making an effort to keep in touch with employees who leave and give them plenty of opportunities to change their mind.

``They were constantly taking my temperature in a very nice way,'' said Leslie Osborn, who returned to Microsoft in May from an Internet retailer. ``The door was wide open to come back,'' added Osborn, now a senior programming executive at Microsoft Network.

For Microsoft, attracting and keeping good people is one of its most critical tasks. With intense competition for brain power, every employee counts. Turnover in the information technology industry runs as high as 18 percent. While Microsoft says its turnover rate is about half the industry average, it still loses about 3,500 employees a year, equivalent to 9 percent of its global workforce.

Dot-com burnout

These days, one factor behind the renewed interest in Microsoft is dot-com burnout.

``There are a number of great ideas out there turning into start-ups, but the majority aren't going to be successful,'' said David Pritchard, Microsoft's director of technical recruiting. The company recently has begun tracking the number of people it rehires. ``People are telling us they've been promised a lot of things, but a lot of firms aren't delivering on those promises.''

Osborn, for instance, worked 70 hours a week at an Internet retailer in Seattle that she had joined after leaving Microsoft. While the company looked great on the surface, she soon found it lacked such basics as a functioning human resources department, office equipment, an internal Web site and adequate health insurance.

``The promise was very exciting,'' she said. ``Underneath, it was just a lot of chaos and an extreme lack of infrastructure.''

The company's ``seat-of-the-pants'' management style made it hard to do her job well, said Osborne. She saw four top managers fired in the first few months during a company reorganization.

Other Microsoft returnees say their experience at dysfunctional start-ups made them appreciate the ample resources they had at established companies.

``I realized what I had and what I missed,'' said Patricia Mitchell, another Microsoft returnee who works as a business development manager in Foster City. She left Microsoft last year after a friend convinced her to join a small Silicon Valley tech company. She had more responsibility than before, but says, ``I didn't feel that kind of stimulating environment where I was in the forefront of technology.''

Even those who leave Microsoft often are still considered part of its flock. They receive ``customized information and direct access to recruitment people to help them stay in the fold of the business,'' Pritchard said.

The grueling all-day interviews new job candidates go through are scrapped, and former employees are treated as current employees, Pritchard said.

Hiring former employees can help offset the problem of turnover, said Craig Silverman, senior vice president at Hall Kinion and Associates in San Francisco.

To win back their workers, tech companies are trying everything from starting newsletters for friends of the company to mailing out Frisbees and free goodies.

But sometimes the world's biggest software company still can't match the appeal of a hot new start-up.

After former Microsoft engineer Deepak Amin founded his own software company, vJungle, at least 35 employees from Microsoft left to join him. It didn't hurt that his office is sandwiched between two parts of the Microsoft campus, and vJungle employees rented a bus and dressed up like gorillas to spread the invitation.

Phani Vaddadi had a key position leading Web architecture projects at Microsoft before becoming vJungle's chief technology officer. While Microsoft tried hard to keep him, ``Deepak tried harder,'' he said. ``He put so much energy and passion into it that it was hard to resist him. I have a lot of technical passion for what I do.''

Small-teams approach

Microsoft tries to replicate the passion and atmosphere of start-ups by grouping people in small teams.

After the dot-com implosion, it might not have to work so hard. More people seem willing to chuck the trendy ideas of the start-up world in favor of decent health insurance and weekends at home.

For Bob Aquino, who worked at several start-ups before joining Microsoft three months ago, working 70 hours a week at the office and another 15 or 20 at home was enough. But getting called into work on Easter Sunday between bites of mashed potatoes was the last straw.

``I feel like sometimes they owned employees,'' he said of his previous job at an Internet bookseller whose name he won't divulge. ``It was very much an intrusion.''

He left the dot-com world for a systems administrator position at Microsoft's Hotmail e-mail operations in Mountain View. He did get his personal life back, he says, but ``I did get a fair amount of ribbing about going to work for the `Evil Empire.' ''
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