By Michael Foy, President of Publishing Search Solutions
Here’s a newsflash. Google does well and continues to enjoy exponential growth. Like most organizational success stories they have an underlying philosophy that they credit for this. Their Senior Vice President of People Operations, Laszlo Bock, revealed some of this philosophy in an interview. He had just published a book called Work Rules. It is counter-intuitive. Want to hear his key to their success? Their managers don’t hire or fire or determine raises or bonuses. Yes, you read that right. And it bears repeating. Their managers don’t hire or fire or determine raises or bonuses.
Laszlo explains that employees that need to curry a manager’s favor for their rewards can’t wield their full creative abilities. If, however, a manager acts as an advocate, coach and procurer of resources the relationship turns much more productive for the organization as a whole. The less formal authority a manager has the more latitude his team has to innovate. Decisions are based on data not on managers’ opinions. Who chooses the projects you ask? They are oftentimes determined by the team or team member. Is it any wonder then that Google has been rated the “Best Company to Work For” an unprecedented five times as reported by Fortune magazine?
So Google, an international company, is the best workplace with tens of thousands of employees, very deep pockets, a 30 percent profit margin and an army of PhDs. With those advantages what else would you expect? But as Laszlo cites in his book another company with an equal reputation is Wegmans. Unlike Google, Wegmans is a family owned, Northeast based supermarket chain with a workforce made up of local high school grads in an industry with a 1 percent profit margin. They also provide an extraordinary environment to encourage employee creativity. Like Google, Wegmans enjoys a loyal, productive and stable workforce that provides the foundation for their success.
Treat your people well and provide for their creative freedom. Can that really work? As proof that it does Laszlo cites several examples in his book. In one case, Mexican factory workers that were given more freedom doubled their productivity relative to those that operated with traditional manager/employee relationships. In another, Costco generated 87% better operating profit per employee as opposed to Sams Club. There are other examples in his book too but the point is to give employees a say and then trust them. If you already have and you’re not nervous you haven’t empowered them enough.
But now let’s address the elephant in the room. Would all employees automatically improve if they were given the freedom to innovate? No. And that’s even the case at Google. To start with any organization still bears the burden of finding and adding the best suited people.
As Laszlo Bock confirms refocusing on hiring better will have a higher return than almost anything else you can do. As such, Google has raised the hiring function to a science. Without getting into the details of their system Laszlo does call out certain truths in his book. A partial list follows.
- Top performers aren’t looking for work. They’re doing well where they are and are usually rewarded appropriately. Google spends considerable time and internal resources to court those that aren’t looking.
- Finding a great person from an inbound application is low. Countless hours are spent sifting through floods of applications from the likes of Monster.com etc… Google stopped posting to job boards in 2012 due to the poor hiring rates from them.
- It’s better to hire a high performer from a state school for instance as opposed to a mediocre performer from an Ivy League school.
- Finally, once identified, one must give unique candidates a reason to join.
Those are obvious, right? In the interests of full disclosure they are to me maybe because I have the benefit of matching talent to unique working environments in my day job as an Executive Recruiter. Speaking as a recruiter, whether it’s Google or someone else I can appreciate when a client has a critical need for a talented professional that’s key to the company’s growth. But once the hard work of landing a candidate is done doesn’t it make sense to provide a working environment where that person can succeed? Google has learned to leverage people’s creativity to great advantage. But, as in the example of Wegmans, you don’t have to be a Google to do the same.