VMware by Broadcom: layoffs and redundancy

• Over 2800 VMware employees have been laid off or made redundant by Broadcom post-acquisition.
  
• Broadcom CEO insists company will remained focus on growing VMware. 
• CEO also requested VMware employees to return to office to work. 

As soon as Broadcom announced its plans to acquire VMware, many in the industry understood that layoffs would be in store for staff should the deal go through. And true enough, since the deal closed, more than two thousand VMware employees have since been laid off or made redundant by Broadcom.

VMware has over 38,000 employees worldwide. In the US, a report by ChannelFutures stated that data stems from WARN notices the acquisitive chipmaker has filed in multiple states. The Worker Adjustment and Retraining Notification (WARN) Act helps ensure advance notice in cases of qualified plant closings and mass layoffs.

Broadcom’s actions post-acquisition are nothing new. The company made similar moves when it acquired CA Technologies, Symantec and several others in the past. But most of the companies it acquired previously were neither as profitable or innovative as VMware.

“While an important moment for Broadcom, it’s also an exciting milestone for our customers around the world. And as I said when we first announced the acquisition, we can now come together and have the scale to help global enterprises address their complex IT infrastructure challenges by enabling private and hybrid cloud environments and helping them deploy an “apps anywhere” strategy. Our goal is to help customers optimize their private, hybrid and multi-cloud environments, allowing them to run applications and services anywhere,” said Hock Tan, president and CEO of Broadcom in a statement.

While Tan has hinted that the company will remain committed to several offerings by VMware, there have been questions asked about the areas that were not mentioned. That includes VMware’s cybersecurity venture – Carbon Black.

Carbon Black may no longer be a key business unit for VMware post-acquisition. Broadcom already has several cybersecurity ventures under its group and a recent report from CRN stated that Broadcom had told VMware channel partners to immediately stop bundling sales of VMware products with those belonging to Carbon Black.

This is the first of many changes implemented by Broadcom. In an email and town hall meeting with VMware employees, Tan said he plans to review strategic alternatives for both Carbon Black and VMware’s end-user computing practice.

New leaders for VMware?

With layoffs ongoing at VMware, there have also been some changes made to the senior management team of the company. Raghu Raghuram is now the former CEO of VMware. The man who remained optimistic about the deal, posted on LinkedIn that he will now be taking a break and will remain to serve as a strategic advisor to Tan.

“During this time, we have navigated a dizzying journey together that spans the full lifecycle of a business – from raising debt financing to spinning off from Dell and operating as a standalone public company, to being acquired by Broadcom and executing through a complex regulatory process to finally arrive at this milestone moment in VMware’s history. Throughout it all, I have been amazed at the resiliency and focus of the VMware team as we repeatedly beat our financial goals, broke new ground with our product releases and took time to celebrate the values that make us a special company,” said Raghuram in his post.

Also leaving the company is Sumit Dhawan. The former president of VMware has now joined Proofpoint as its new CEO. In his most recent role as president of VMware, Dhawan was responsible for driving over US$13B of revenue and led the company’s go-to-market functions including worldwide sales, customer success and experience, strategic ecosystem, industry solutions, marketing, and communications.

Apart from Dhawan and Raghuram, several other senior executives have also announced plans to move away from VMware. But that’s not all. There have also been reports of several VMware offices being closed down as well around the world.

In the US, reports state that some of Broadcom’s employees will also now move to VMware’s campus office in Palo Alto. In an interview, Tan also requested VMware employees living within 60 miles of a Broadcom location to return to the office to work.

“If you are customer-facing, go-to-market (sales), then sure, you can be remote, I don’t care…Any other exception, you better learn how to walk on water. I’m serious,” Tan said in an interview.

VMware layoffs and redundancy in Southeast Asia

The layoffs and redundancy announced by Broadcom seem to have a major impact on VMware’s Southeast Asia offices. In Malaysia, the entire VMware office has been shut down, while several channel sales partners in Singapore have also been made redundant following the acquisition.

A conversation with a former executive of VMware revealed that many employees in the regional headquarters are still unsure if they would want to remain with the company. He said that many were not pleased with the way Broadcom deals with clients and partners, and that he could see clients moving away from relying on VMware products in the future.

He also said that Broadcom is quite adamant in how it conducts its businesses. While the company is profitable and doing things right, its approach to sales may be different from how VMware operated in the past. And this is where VMware employees might find it more challenging to cope with – and could be made redundant.

As such, VMware employees may have a bleak future on the horizon, but it doesn’t mean that it’s the endgame for them or the company. While many will undoubtedly leave in search of better opportunities, there will also be those who remain and continue to support Broadcom in its plans to grow VMware’s business.

After all, Tan has acknowledged that Broadcom qill continue to invest in VMware’s innovations and continue to support the development of the company’s products. The only question will be whether the team that remains will be open to Broadcom’s terms of doing business or will decide to move on.

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