Friday, May 22, 2015

How Google Works - Eric Schmidt and Jonathan Rosenberg

I am fascinated by the astounding growth of Google as a company and of what it has achieved. There are innumerable positives that Google has brought into our lives (not to mention a few causes for worry too - the amount of information it has about me being the prime one). But overall it's well in the positive and still growing. So, a book that gives an insight into its thinking is something I just could not resist. Just as I have my reservations about certain things Google does while also admiring many other things it does right, the book had its pluses and minuses. But who is looking at minuses right now - let me take away all that it did right.

To start with I liked how the two authors, top managers at Google say they relearned everything about management in their years at Google. And the way they put company culture first up - its the key to how the company functions. It's amazing how many companies miss that part and do not give much thought to nurturing the culture they'd like to see in their company. 

The authors advise companies to first believe in their own slogans (and not simply write stuff  that no one knows or believes). They cite a classic example of how culture reflects in ownership at work. Larry finds certain ads that don't match the search parameters. His response - a note on the board with the offending ads and a comment that "These ads suck". (No calling the teams responsible for a meeting etc, just a simple expression that something was not right with the whole.) The response to his action is even more interesting. A team of Googlers totally unrelated to the product team that was responsible for the offending results sees the note, comes together, works over the weekend, builds a prototype and comes with sample results. These guys were not even on the ads team. Now how many companies can boast of such passion, ownership and freedom is what we need to concern ourselves with. Not many I'd say. It boils down to culture.

I can see many HR professionals and managers jump up and say - its easy for Google to do that because they pay well etc and how its not the same for everyone. (How companies go anywhere with such negative HR people I always wonder.) But look at the founding principle google works on - if the culture is right, the right people will come. Its the culture that attracted people like the team that worked on something that was not their headache really. The authors term such people as Smart Creatives – those who value the culture of the place more than other things. Now hopefully the significance of culture drops in.

Nowhere have I heard this said so emphatically - that culture is the most important thing. And I believe it is right. If cultures have to be built the cultural pillars and codes must be carefully identified and behaviors clarified.

The next question, how do we set culture? The solution the authors give is simple - ask the core team these questions. What do we care about? What do we believe in? What do we want to be? How do we want our company to act and make decisions? The best cultures are aspirational. 

Some of Google's own founding principles - "Focus on the user" "Long term focus" "Don’t be evil" "Making the world a better place" etc.

To me, cultures are shown at the door, at first level of interaction like the security guard, the receptionist, the one who takes the call. Are they innovative and service oriented. If they are not, you're only talking.

Office Spaces
If you have Smart Creatives (SCs), keep them crowded because they like the energy. They like interacting with one another so facilitate that energy buildup by creating facilities that maximise interactions. Not distant isolated cabins that separate everyone. In fact the authors ask - keep them so crowded so you hit someone if you swing your arm. At the same time give them quiet spaces to reflect and rejuvenate and be by themselves.

The key idea is this. When at work be surrounded by team members, work, eat, live together. Don't worry about messy, just let them go with the ideas. Be stingy with things that don’t matter and invest in stuff that does. And Google expects people to work at office and not at home. Makes sense.

One of the things that struck me during cricket workshops was this. The same people who work in quiet solitude and isolated behaviors at office, come together and bond with high energy in the cricket workshops. The energy is some 20 times more. My question was always this - can we take this energy back to the office and if not, why? Now I got my answer. It's because offices are not designed to be energetic. They separate energies. Now if my cricket dressing room was like an office with the captain in a big cabin on the highest floor and all others in faraway cabins, can you imagine how the energies would be. What Google has cracked is that - keep the layout like a dressing room and the energy comes automatically.

Also to be stingy with what does not matter - great story. Reminds me of two promoters I saw during my days in the bank. One who spent all his money building electric fences and guest houses and ran out of money for the main equipment. Another who used all his short term monies to build the main assets and was already into production and revenue generation. 

Decision Making
The authors talk of the dreaded HIPPOS – the Highest Paid Person's Opinion. It's common sense that decision making quality and experience may not always go hand in hand. But its a cultural thing again if one has  to look at data and not mere opinions. Clearly, its the quality of idea that matters and not who suggests it. 

Now most companies will find it difficult to accept this. On one hand they want fresh ideas but on the other hand they will not like juniors to come up with fresh (perhaps half baked ideas). These are the insecure leaders. They ask for ideas, trash everybody's ideas and then impose their ideas on the rest of the team. Most creative guys will leave such teams.

To be able to take ideas at face value you need to have confidence in your people and to do that you need to have enough self confidence (secure) to let them ideate a better way. For a culture of meritocracy managers must understand and build a culture where dissent is an obligation, and not an option. They must empower juniors to come up with and defend their ideas. Wonderful stuff and truly aspirational.

Team sizes
Google (or the authors) suggests flat hierarchies. They recommend a minimum of 7 direct reports. They quote Bezo (Amazon?) and his 2 pizza rule - teams must be small enough to be fed with 2 pizzas. The principle - small teams get more work done.

People Principles 
To get great work done find impact people who run the company by performance and passion. Organise around them. Invest in people who do what they think is right- whether or not you give your permission (you'd think that was a basic rule but then most times its only lip service ).Okay once you find impact people who will run with your ideas, push them. Give those people more work to do. Push them until they tell you its enough. Whoa! The 20% of the Pareto's lot?

Now Impact People will come with their own quirks. Google differentiates between knaves and divas.  The rule here - exile knaves, fight to keep the divas. Both may seem alike but here are the differences. Knaves  are arrogant, have no integrity, are sloppy, selfish, jealous, take credit. Once a knave always a knave so get rid of them. Divas are good because they think they are better than the team but do not harm the team. They may actually push the team.

In technology companies the authors recommend the top management ought to have 50% who are product experts. Finance and sales are 2nd.

Work is an integral part of our life - it takes up most of our waking hours, keeps us paying bills, feeds our aspirations. But most people (I did too) seem to think that work is something we do until some great big fortune happens and our dreams come true. To me work is where you hone your attitude, skills  etc on the path to making your dreams come true. I'd actually like to see a system coming where people actually pay to work in good companies!

Anyway overworked in a good way is what the authors suggest because work is an important part of life and is not separable. Give responsibility and freedom to these Smart Creatives (works for all teenagers too! or anyone else). Make them own things for which they are responsible and see how they run with it. Most surprise you. 

As for burnout, I like the perspective that it happens not by overwork but by resentment at giving up what matters. Nice insight. So it helps to give the employees control. Once again the onus shifts back to having secure leaders who are willing to trust and mentor and care. Find the right leaders and much can be done right.

Establish a culture of YES (this is for the Managers)
Facing NOs from their managers repeatedly is a tiny death of Smart Creatives say the authors. Enough NOs and Smart Creatives stop asking and exit. Saying YES as a manager leads to new experiences.

My experience with the NOs has been the same. There are people I know who say they are always open to new ideas. The moment a new idea is brought to the table it is cut short and a long lecture on what is wrong with the new idea follows. New ideas first come to the table as work in progress - not as full grown trees. By cutting down the ideas when they are young my manager friend effectively stopped his entire team from opening their mouths. 'When I ask you for new ideas you have nothing to say,' he says. 'See, we have such useless talent.' It's self fulfilling. If only he had that much security within himself to nod and  listen and say go on, so many of those ideas would have come out. Some may fail but so much new thought could have come. Now the team works like it is dead. They know it does not pay to give out any new ideas.

Fun-Not FUN
When Ian Chappell said that the way to bring the best out of the team is to make the cricket interesting, I could not agree more. Here the authors think on similar lines. A great job should be fun they say. Certainly future success is fun. But most fun comes everyday things - laughing, joking and enjoying company of one's colleagues. Ho can we keep it fun is the question? Loosen up.

I have a problem with the ways many company try to engage employees. Big parties, big hotels, booze, food, event managers who don't have a clue - its all so tacky and trashy. It somehow shows the unimaginative culture of the company. Fun can be in so many different ways, so many enriching ways. Book clubs, walks - use your head fellows.

How To Find Talent
Create the culture and the talent will come. To find the people you want, find one of those types first and then ask for the people they know. 

Porn Filters to Image Searches
Good insight here. While attempting to filter porn images the team realised that there could be a broader use of that application - image searches - where you drag an image into the search bar and it throws up similar images. The lesson - start with a solution to a narrow problem and then broaden its success. You never know where it could go. (It happens a bit like that when writing - a small sliver of an idea grows into something much bigger.)

Back Technical Insights 
For tech companies or startups, the advise is to back technical insights. What is the Tech Insight that gives you an advantage? What aids your growth? What keeps the energy growing? 

Google's original idea was to share as much as possible and to keep improving their search engine. Their focus was to get great at search which they thought they were good at (resisting the idea of becoming a portal which many did). They backed themselves on what they felt they were better at than anyone else. (Which is backing your competitive advantage anyway!)

Default to open, not closed
The google policy is to default to open. In fact they make it easy for customers to leave. Another useful tip - don’t follow competition. It's limiting.

Eric’s notes
Start by asking what will be true in 5 years and work backwards.

Once you put your head inside, or go to the finish line first, all you need to do is walk backwards and address the possible blocks. It is done!

Another important tip. Get input from everyone in the room. Start soon and iterate – iterations can follow based on learning.

Successful companies that grew large all solved problems and used the solution in its products success. They solved a problem for society that way.

Talent Management
This part got me all awake. The authors feel that hiring is the most important job one does. That's because the best talent takes the team places. Though the authors feel that no amount of strategy can substitute for talent I feel differently. In the end its a mix and much depends on the leader.

The authors recommend a committee-based hiring where peers are involved. Google promoted their culture with their hiring line "You’re brilliant. We’re hiring." That kind of an ad attracts all those who think they are brilliant.

What do you look for when hiring? Passionate people (be aware that passionate people don’t use the P word. They live it.) Learning animals. Character, Passion, Intelligence, Growth mindset and how Interesting they are (this through a test - what if you were stuck at an airport for 6 hours with that person).

The list grows longer - Cognitive ability, role related knowledge, leadership experience, googleyness
Ambition and drive, service orientation, listening and communication skills, bias to action (I like that), effectiveness, interpersonal skills, creativity and integrity. That's a lot.

The authors feel that diverse cultures are best (unlike the Indian company that rejected Muslim candidates recently). The idea is to respect - not necessarily like. Look for potential. Everyone knows someone great so get everyone to recruit - referrals, interviews, metrics.

Interviewing  is the most important skill they say. To interview - Prepare. Find info about the person. Ask challenging questions. Test limits of capabilities. Insights.
Schedule interviews for 30 minutes. Hire for passion
Don’t compromise quality of hiring. Ever.

Retaining Talent
Google gives disproportionate rewards when people do a good job. That said, you need to keep their jobs interesting. But when you lose them (which you might if you keep loading them with work) let them go. However try and retain the innovators, the leaders. Counsel them. Seek information on why they are going. Ask them their elevator pitch and if they are not ready ask them to postpone their decision until they are ready. If nothing else get them on the alumni network.

Qualities to Look for when Hiring (Again?)
Smart, knowledgeable, adds value, gets things done, enthusiastic, passionate, self motivated, inspires and work well in the system, well rounded unique interests and talents, ethical, communicates openly,

On Career
The authors feel that it's like surfing. The right industry is like the right place to surf, while the right company is the correct wave to catch. 

Model Employee
Should know his elevator pitch about what he is working on. Combines passion with contribution.

Nice. Shows how much thought he has put in and how engaged he is.

On Decisions 
Decide with data. Show the evidence. Make fewer decisions, meet everyday

On Focus
On spending 80% time on 80% revenue. (how few get that!)

Google believes in having coaches for their players. Makes sense. I agree with that. A perspective always helps.

Share information. Default to open – transparency. Repeat 20 times. Reinforce core themes (Google's are - user first, think big, don’t be afraid to fail). Make communication fresh, effective, interesting, fun, inspirational and authentic. Check for the right media, for right people.

Self Review
This is something most managers might fail - would you work for yourself? Most just don't get it that its people like them who do the work finally and what works for them works for others too mostly.

Business should always be outrunning the process which means constant chaos is good. To foster good people relationships listen, make people smile and use praise. (I can see many going - why should I?)

Innovation is the next big thing. To get innovative ideas find and attract optimistic people, give them the space to create change and culture. Ideas come from anywhere –reward workers for inventions and improvements

Think big, Think 10x 
10 X is what I believe we are capable of when we are fully engaged. With support and platforms, it could grow even more. Give your Smart Creatives more freedom, bigger challenges. The work and responsibility should induce joy, not anxiety - that's the check for a Smart Creatives and fakes.

Set Unattainable goals
Objectives and Key Results – look at the big picture with measurable key results, should be a stretch to achieve. Then go for it.

Resource Allocation 
70/20/10 – Core business, Emerging products and new things, Big failure risks

Creativity loves constraints
I agree. Lack of resources forces ingenuity. It's a paradox but like all p's, true.

20% time
20% time where employees work on whatever they choose. Actually it becomes 120% of time because its outside their regular work timings. So employees can try their hand at something new, build a prototype and work together with a team. Helps them understand ownership and develops many aspects of their personality too. In fact I think its a great idea to grow people. 

The authors stress on creating an environment resilient enough to take on risks and tolerate failures. But the key is to fail fast. With a long term vision.

Imagine the unimaginable
This requires a culture that encourages innovation. Most innovative things look like small opportunities. People are not rewarded normally for taking risks and are penalised for failure which is a sure case for missing opportunities.

And there is so much more in the book. From the look of it Google seems to have practiced what most preach and have the results to show for it. The book is easy to read especially because its written for the lay person, complete with the dummy jokes etc. It does give credibility to their idea of defaulting to open. Though the authors debunk some of the old school management ideas, one can see that many ideas are in fact refinements of the old structures. You still need vision, plans, people etc. But where they have been great is at managing something so fluid by reacting fast and keeping it all under control (by giving up control). Many thoughts and more importantly practices are aspirational without doubt. Many could learn and benefit from it and one can only thank the authors for sharing so transparently. If you're looking to become a Google, worth a read.

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