Sep, 2015

This is another quick read from the founders of 37 Signals and creators of Ruby on Rails.  Nadine West has been working remotely from the beginning and there isn’t anything in the book to disagree with.

ADVANTAGES TO REMOTE TEAMS

• Fewer interruptions than at the office
• No commuting
• Technology makes it possible
• Flexible work hours
• No need to live in a city or suburb
• Freedom to travel while working
• Bigger pool of talent to choose from
• Save money on office, overhead
• Pay your employees more compared to local rates (except for the coasts)
• The work itself becomes the only yardstick to judge someone’s performance
• When people manage themselves, managers must have other skills to be useful
• When an employee moves to another city, it has zero impact on their employment, so less turnover
• Parents can spend more time with family

EXCUSES AGAINST REMOTE TEAMS

• Less structure and regimen: establish your own daily routine
• Fewer serendipitous moments of brilliance: not really needed all the time
• Drop in productivity: only hire people you trust
• Too many distractions at home: vary your routine, do more interesting work
• Data security: use standard tools
• Big businesses don’t do it: big business are usually very inefficient anyways
• Impact on company culture: demonstrate your culture through your work
• Communication suffers: require some overlap, use collaborative tools
• Collaboration suffers: give everyone access to everything by default
• Social interaction suffers: have a group chat room, talk online a lot

REAL DRAWBACKS TO REMOTE TEAMS

• Cabin fever: remember to get out of the house, schedule checkin calls, cowork
• Burnout: working too much is more of a concern than too little, establish work-life boundaries
• Health: encourage exercise, get ergonomic furniture

HOW TO HIRE/MANAGE REMOTE TEAMS

• Never hire anyone with a bad attitude.  It’s toxic.
• Pay your team more than local markets (except coasts).
• Develop your team’s writing skills.
• Hire someone for a small task before hiring full-time.
• Try to meet in person a couple of times a year.
• Over-communicate to keep everyone engaged.
• Check-in with people regularly.
• Watch out for drops in motivation and counsel if needed.

Two things about this book: it’s very short and it has a very simple message: repeat “I love myself” over and over, every day.  I bought it because it was recommended by James Altucher, Tim Ferriss, and Sean Stephenson.

• Repeat “I love myself” every day.  Do this with emotional intensity.
• Meditate for 5-10 minutes every day.  Inhale “I love myself.”  Exhale anything that arises.
• Respond to fear by telling yourself it’s not real.

Preface: Why Google’s rules will work for you

• Companies who follow many of the same principles: grocery chain Wegman’s, a Sri Lankan clothing manufacturer, a Nike factory.
• The book’s key messages: take power and authority over employees away from managers, managers serve the team not vice versa, empower your employees

Chapter 1: Becoming a Founder

• Every great tale starts with an origin story.
• Larry and Sergey knew how they wanted employees to be treated.
• Examples from Google: hiring decisions are made by groups, stock grants to all employees, more women engineers, dogs are welcome, free meals
• Other founders who focused on treating employees well: Henry Ford, Milton Hershey, and Bell Labs founder.
• Encourage your employees to think of themselves as owners.

Chapter 2: Culture Eats Strategy for Breakfast

• 10 Things We Know to Be True: 10 guiding principles for Google
• The 3 defining aspects of Google’s culture: mission, transparency, voice
• Google’s mission: organize the world’s information
• Good missions gives individuals’ work meaning.
• A more traditional mission (creating value for customers or shareholders) doesn’t inspire innovation.
• An inspirational mission attracts world-class talent.
• Deep down, every human being wants to find meaning in their work.
• If you believe people are good, you must be unafraid to share information with them.
• Google’s intranet includes product roadmaps, launch plans, employee status reports, team goals (OKR).
• Larry and Sergey hold a weekly all-hands TGIF meeting, with an AMA session
• Transparency has been proven to improve performance.
• Voice means giving employees a real say in how Google is run.
• Employees see problems first and are the best source of solutions.
• Local culture groups have been critical for maintaining the Google culture as they grew.

Chapter 3: Lake Wobegon, Where All the New Hires Are Above Average

• Offering higher wages just means you get more applicants, not necessarily better.
• Most organizations recruit like everyone else: post a job, screen resumes, interview people, pick someone.
• Most people are simply not good at interviewing.
• Interviewing is flawed because of cognitive biases.
• It’s almost impossible to train an average performer and turn them into a superstar.
• Today, companies spend more on training than on hiring, when they should be spending vast more on hiring than on training.
• Key Point 1. hire more slowly and more carefully.
• The top 10% aren’t normally looking for work.  But finding one who is, is worth the wait.
• Key Point 2: hire only people who are better than you.
• Take a bright, hard-working student who graduated at the top of her class in a state school over an average or above average student at an Ivy League.
• Warning from Malcolm Gladwell: systems are just as important as stars, so have great processes and great people
• Two intangible traits Google looks for: humility and conscientiousness (don’t just hire IQ)

Chapter 4: Searching for the Best

• Crowdsource HR and hire people by committee.
• Never lower your hiring standards, hire more slowly or expand your hiring pipeline instead.
• Ignore candidates’ references and ask other people who worked/studied with them instead.
• Hire smart generalists, not experts.
• Grades and transcript are a crude measure of intelligence.
• Becoming a Googler might mean 6 months of interviewing.
• Bad hires can be toxic so do everything you can to avoid them.
• For many years, Google’s best source of new employees was existing employees.  Talent attracts talent.
• Later on, Google had to build an in-house recruiting department to find employees, often already working for other companies.

Chapter 5: Don’t Trust Your Gut

• In an interview, people form an opinion of you in the first 10 seconds and then spend the rest of the interview looking for evidence to confirm that opinion.
• Most interviews are a waste of time.
• The best predictor of performance is a working interview.
• The second best predictor is a general cognitive test.
• Structured (behavioral or situational) are tied with general cognitive test.
• The best approach is to use a combination of working interview, general cognitive test, and structured interview.
• To keep improving, ask your candidates for feedback about the hiring process.
• Four key attributes that predicted success at Google: general cognitive ability, leadership, personality/character fit, and role-related knowledge.
• Also track your interviewers’ ability to predict good performers.
• Always hire by committee.

Chapter 6: Let the Inmates Run the Asylum

• Take power from your manager and trust your people to run things.
• Psychology says that managers have a tendency to amass and exert power, employees have a tendency to follow orders.
• De-emphasize titles, status, and hierarchy.
• In a non-hierarchical organization, symbols and stories communicate company values and culture.
• Make decisions based on data, not managers’ opinions.
• Not sure what to do?  Run an experiment and let the data tell you.
• Be aware of cognitive biases that impair decision making.
• Google’s 20% Rule (20% on side project) is an example of finding a way for people to shape their own company.
• Survey your people (Happiness survey, Ecstasy survey, Googlegeist) to give your people a voice in how their company is run.
• Let your people make decisions.  Bubble it up to the next level ONLY when they can’t come to a decision.
• Happier people generate better ideas.
• Fight the impulse to micro-manage and control everything.  Instead, hire better people and trust them to do their job.

Chapter 7: Why Everyone Hates Performance Management and What We Decided to Do About It

• Use OKR (objective and key results) framework.
• Focus on both speed and accuracy (aka efficiency and quality).
• Google tried a bunch of performance ratings system and found the best was to rate employees on a 5.0 rating scale every 6 months based on OKR.
• Always separate the “how you did” discussion from the “how you can do better” discussion.  Why? Because intrinsic motivation >> extrinsic motivation.  Performance evaluation should be separate from people development.
• Performance evals should come from managers, coworkers, subordinates, and self.

Chapter 8: The Two Tails

• The biggest opportunities lie in your best and your worst employees.
• Most organizations under-reward and undervalue their best people.
• Why focus on your worst performers?  They will either improve a lot, or you can identify which of them should leave.
• Learn from your best performers.  Learn what makes them so good.
• Google studies found out that good managers matter a lot, contrary to what they and most engineers thought.
• Google found that their best managers: were good coaches, empowered the team, cared about employees, were results oriented, communicated well, developed teams, had a clear vision, and had useful technical skills
• Google studied top managers and created a management checklist which drove managers’ performance eval design

Chapter 9: Build a Learning Institution

• Most training money is wasted, especially if you use an outside company.
• Deliberate practice is, by far, the best way to learn.
• Your organization’s best teachers are sitting right next to you.
• Have your best performers teach the worst performers and the overall gain is much greater.
• Academic knowledge is too theoretical.  Consultant knowledge is too shallow.  Your people are the best teachers.
• G2G is a Google program for Googlers to teach other Googlers various skills, such as meditation, intro to programming, presentations.
• Everyone in industry uses the 70/20/10 rule (70% on-the-job, 20% coaching, 10% classroom) but there’s no evidence that rule works.
• Google thinks the best way to learn is to teach.  Plus teaching gives people purpose.

Chapter 10: Pay Unfairly

• Before Google’s IPO, their average executive salary was $140k, lower than average for Silicon Valley.
• Early on, Google hired only risk-seeking entrepreneurial types willing to take a big pay cut for extra stock options.
• At Google, everyone is eligible for stock grants.
• Paying more can get you more loyalty and productivity.  Costco vs Sam’s Club.
• The best of the best are worth a lot and should be paid accordingly.
• People on average are underpaid early in their careers and overpaid later in their careers (Edward Lazear).
• Most companies design pay systems that incentive their best people to quit.
• Pay according to contribution, not seniority.
• Individual performance follows a power law distribution (80/20).  Note: this is less true for industrial/manufacturing roles where there is a ceiling imposed by machinery or raw materials.
• Celebrate accomplishment not compensation by focusing on earned praise and non-financial awards.
• More experiential gifts (trips, dinners, electronics).  Fewer cash awards. (Dan Gilbert, author of Stumbling on Happiness)
• Let employees grant awards to other employees. (gThanks, Wall of Happy)
• Public recognition of small acts and accomplishments is incredibly underutilized.
• Reward thoughtful failure to encourage risk-taking and innovation.

Chapter 11: The Best Things in Life are Free (or Almost Free)

• Most of Google’s people programs can be duplicated by anyone.
• Many on-site services are actually provided at the cost of the vendor, not Google.
• Perks paid for by Google: a few electric vehicles, concierge team.
• Annual Take Your Parents To Work Day.
• Meetups for Googlers various interests.
• Culture Clubs.
• Various community service projects.
• Micro-kitchens to encourage social interaction and teamwork.
• Authors@Google was self-organized by Googlers.
• Talks@Google can be replicated by asking a local college professor to stop by.
• Be there when your people need you: unexpected death benefits, maternity leave.

Chapter 12: Nudge…a Lot

• Book recommendation: Thinking, Fast and Slow.
• Small changes can make a big impact.  Find out what those small changes are.
• Small changes in physical layout can make a big impact.
• Small changes in pricing can make a big impact.
• Book recommendation: Nudge
• Use nudges (and experiments) to help your people become healthy, wealthy, and wise.
• Nooglers and checklists help new Googlers succeed.
• Small nudges help improve employees investing and personal finances.
• Small nudges help employees eat more healthy.

Chapter 13: It’s Not All Rainbows and Unicorns (Google’s Past Mistakes)

• Sometimes information leaks out but that’s just the price of transparency.
• So many perks can sometimes create an attitude of entitlements.
• Be careful about continuing something that’s no longer useful.
• Don’t try too many new ideas at once.
• You can’t please all the people all the time, so just do your best.

Chapter 14: What You Can Do Starting Tomorrow

1. Give your work meaning.
2. Trust your people.
3. Hire only people who are better than you.
4. Don’t confuse development with managing performance.
5. Focus on the two tails.
6. Be frugal and generous.
7. Pay unfairly.
8. Nudge.
9. Manage the rising expectations.
10. Enjoy!