August 11, 2025
5 min read
Diana Bahur-Nir, Meir Orbach
Microsoft Israel GM: ‘In the AI Era, Success No Longer Means More Employees’
Alon Haimovich on Copilot, AI Agents, and Microsoft’s Workforce Restructuring Amid AI Growth
In the midst of historic growth and rapid technological advances, Microsoft is redefining its identity. No longer content to be simply a software company, it is positioning itself as an “intelligence engine” for organizations worldwide. This transformation, driven by breakthroughs in cloud computing and AI tools like Copilot, comes even as the company has undergone significant restructuring, laying off 9,000 employees globally earlier this year. Alon Haimovich, Israel Country Manager at Microsoft, explains why the AI era demands new skills, how autonomous AI agents are reshaping industries, and why Israel should focus on talent and collaboration instead of competing with tech superpowers on infrastructure.Microsoft’s Workforce Changes Despite AI and Cloud Growth
When asked about Microsoft’s booming cloud service Azure and AI technologies like Copilot and iGentic boosting the company, yet the global layoffs of 9,000 employees in May and June 2025, Haimovich said:“Microsoft is a company of enormous size, with meteoric growth on the one hand, that has decided to make adjustments to its workforce. Saying goodbye to employees is always difficult, but in an email sent at the end of July, Satya Nadella essentially said that in the age of artificial intelligence, the old equation, business success equals more employees, needs rethinking. It’s a dramatic paradigm shift. It’s like saying, ‘The king has no clothes.’”Nadella’s letter clarified that despite strong business performance, Microsoft is shifting its worldview for the AI era. The company no longer seeks to be just a seller of software products but an intelligence engine for its customers. Haimovich added:
“I have no doubt we’ll see more organizations go through this kind of structural change, closing departments that don’t contribute to growth, and adding employees in areas where they want to expand. There’s an opportunity here: employees who are curious and willing to learn new, relevant tools will thrive, while those focused on routine, repetitive tasks may find their roles disappearing. Others, however, will grow.”
Transforming from Software Company to AI Engine
Haimovich explained Microsoft’s transformation:“Until now, big tech companies invested heavily in cutting-edge infrastructure so customers could run their own generative AI tools. Now, we want to differentiate ourselves by becoming the platform for companies, organizations, and startups to build exactly the AI tools they need for their own purposes. That’s the transformation.”Regarding job security in the AI revolution, he emphasized:
“Both they and their employers are at risk. The required skill set today is very different from before. Microsoft still has over 220,000 employees, but now, every one of them, when preparing a business plan, is expected to know how to use an AI agent to generate quotes, boost sales using AI, and identify duplication of work that might make certain roles redundant.”On the situation in Israel amid the global layoffs:
“Saying goodbye to employees is never easy, but in terms of the overall balance, we came out of this round of layoffs in a strong position. I won’t get into specific numbers, but Microsoft Israel’s business arm is one of the fastest growing in the world, and Microsoft continues to invest in it.”
Practical AI Applications: Copilot and AI Agents
Haimovich demonstrated Microsoft’s Copilot, an AI software that sounds like a friendly colleague, highlighting its practical use:“It’s about showing a practical AI application. I can have these conversations with Copilot on my way to a meeting in any field and prepare en route. I just used the professional version, but there’s also a simpler version in the browser. Copilot can help with more complex meetings too. For example, if I’m moderating a panel with several funds from different industries, I can ask: ‘How do I involve everyone in the discussion? What’s the story that will connect them, and which question should I ask when and to whom?’”He also mentioned the “Security Copilot” that assists beginner analysts in investigating security breaches. On the difference between Copilot and autonomous AI agents:
“It’s similar to what ChatGPT does, we have a conversation, develop it into text and voice, but it’s not autonomous. You ask a question and get an answer. An AI agent is one step further. For example, I can say: ‘Plan me a trip to Greece with a beachfront villa, authentic food, and minimal tourists. Book the flights and hotels.’ The agent doesn’t just answer, it executes the plan, step by step, with my feedback, until it’s done.”
“That opens up endless applications where you’re not just asking for information or content, but the AI acts on your behalf. Let’s say: ‘Apply for National Insurance on my behalf and complete the process by the end of the day.’ Or: hire a new employee, assign them a phone, car, salary, and workspace. The agent does it autonomously. Is it scary? Maybe, but it’s also full of opportunities.”
AI in Israel: Mental Health and National Strategy
Haimovich shared an example of AI application in Israel’s mental health sector since October 7, 2024:“There can be 1,000 potential patients for every psychiatrist, and many can’t even get an initial consultation. The Ministry of Defense and the Rehabilitation Division are already using Mentaily, developed with Sheba Medical Center and based on Microsoft technology, to run an initial triage conversation through LIV, an AI tool that classifies urgency and is now built into the process of requesting recognition for a condition.”Regarding the Nagel Committee’s recommendation to invest 25 billion shekels over five years, including 18 billion for building an Israeli AI language model, Haimovich cautioned:
“Spending 18 billion shekels on supercomputing won’t make the difference. Israel has an opportunity to leap forward in every field thanks to AI, and we already have 2,000 AI-based startups out of 7,000 total. The government’s role is to enable and accelerate. But we must recognize what we do best, and what’s better left to others. Israel isn’t China or the U.S., and we don’t have the budget to compete on superpower-scale AI infrastructure. Instead, we should give our research community and startups access to the world’s most advanced AI platforms through partnerships with the largest global companies.”He explained that Microsoft alone spends $80 billion a year on AI infrastructure, and big tech firms invest over $300 billion annually, making it impractical for Israel to compete at that scale.
The Path Forward: Talent and Security
Haimovich emphasized the importance of talent development:“We need training programs, from schools to professional courses, to prepare developers for building advanced technologies. And we must raise cyber awareness. Israel is a target for major cyberattacks, and AI increases the risks. We have to ensure AI is developed securely and responsibly so it doesn’t cause harm.”On Microsoft’s AI investment returns:
“I feel the benefits already. But when you invest $80 billion in AI, the return isn’t immediate. AI success requires massive investment, and it’s an evolution, not a quick win. Over time, it will pay for itself.”
Personal Journey and Leadership Philosophy
Haimovich shared his own career path:“I started as a technician driving a Kangoo van, soldering sockets into walls. This was before most people knew what the internet was. I’m not the smartest person in the room, but I’m obsessed with success, love learning, face challenges head-on, and work hard. That took me from technology into sales. I was VP of Technology at Cisco for many years, then moved into business leadership, and here I am.”On what he looks for in employees:
“A manager shouldn’t be a know-it-all or emotionally detached. I believe your employees should be better than you. My advantage is seeing the future more clearly than others and breaking it into clear steps. I need to know who I can learn from to make it work.”He recounted a memorable interview moment:
“When I interviewed my CTO, he began explaining cybernetics in detail. I stopped him and said: ‘Now explain it to your grandmother in three sentences.’ Why? Because in our world, communication must be clear and impactful, otherwise it’s ineffective.”On his goals:
“I approach every job as if it’s my last, even when I was an installation technician. Microsoft Israel is one of the fastest-growing sites in the company worldwide. My goal is to keep that momentum going through one of the biggest revolutions of our time. That excites me.”
Source: Calcalist Tech