In his post Missed big HR meeting (MyMicrosoft is now improved) Robert Scoble mentions that he missed yesterday's town hall meeting at work where a bunch of employee benefits/compensation changes were announced. I missed the meeting as well because I took a friend on the Ride the Ducks of Seattle tour. I haven't been to work yet so I haven't read what the changes are but bits and pieces have come out in blog posts and news articles. Todd Bishop excerpts some of the highlights in his blog post Microsoft rethinks employee reviews ... and towels such as

• "To reset our approach, beginning with this review period we are retiring the 2.5-5.0 rating scale and introducing a three point Commitment Rating scale of Exceeded, Achieved and Underperformed. ... There will be no forced distribution (i.e. curve) associated with this commitment rating, which allows managers and employees to have a more candid discussion about performance."
• "We are increasing our investment in our annual review stock award program. This incremental investment is focused on providing meaningful stock awards to our top talent. 'Top talent' refers to employees who are strong performers, achieve results in the right way and are expected to make the greatest future contributions."
• "We're planning to provide on-campus access to a variety of services, including laundry and dry cleaning, grocery delivery from Safeway and opening convenience stores -- all of which are designed to ease the burden given the hectic pace of life. We will expand and upgrade dining services adding great new retail food in select cafes, dinners to go from Wolfgang Puck and other services. We are also arranging discounts on a variety of home services including house keeping, yard care, pet care, auto services and more.

Getting rid of the curve is great news. Having a quota of how many people get good or bad scores during annual reviews has been a recipe for bad morale for as long as I've seen it practiced at Microsoft. Bringing back a bunch of the stupid cost cuts like the towel service [free towels in the on-campus showers for people who bike to work] is just common sense. The amount of money it saved couldn't have counterbalanced the amount of bad will it generated. Better food in the cafeteria is cool, auto services is also interesting since I my car always seems to need washing and I never seem to have time to do it. I gotta say kudos to Lisa Brummel on doing something to make the employees lives better.

I was surprised to see negative comments from people who aren't Microsoft employees such as TDavid's post For employees Microsoft throws in the towels where he writes

In a move which is bound to be seen as placation and a serious case of Googleplex envy — by those who aren’t employees anyway — Microsoft has restored the employee towel service that was axed for “cost cutting measures.”...

Towels a “symbol of poor leadership?” Who da Punk’s real name must be Who da Kidding. If Microsoft plays lemming to anon cowards like this then the decline of their stock is far from over. I’m sure shareholders will be pleased that they restored towel service and put better food on the menu, thus restoring employee morale — until the stock drops even further.

Outsider customers like me have to wonder what’s next in the long list of employee perks for these major corporations? Why stop at the marginally sane perks? How about insane ones like escort services? If only Microsoft and Google were in Nevada, they could cut deals with the local brothels I’m sure. Heck, maybe escorts.live.com could be a promising vertical niche. The search for skin and sin is on.

I don't think the perks are worthy of such vitriol. First of all, a lot of the Googleplex-style perks are designed to keep people at work instead of having them leave early to manage their personal lives (e.g. getting the car washed, getting home early to walk the dog, etc) or leave campus for meals by having better food in the cafeteria. Secondly, it is common knowledge that Microsoft doesn't pay that great. I've heard that our pay scale is in the 65th percentile meaning that for every 10 companies out there, 3 to 4 of them would pay the average Microsoft employee more for doing the same job. In a climate where Google recruiters are spamming every half-decent employee at Microsoft and recruiter cold calls are not unheard off, the company needs to step up its game if it plans to retain its talent in an increasingly competitive software landscape. 

Taking care of your employees is just good business.