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
- Give your work meaning.
- Trust your people.
- Hire only people who are better than you.
- Don’t confuse development with managing performance.
- Focus on the two tails.
- Be frugal and generous.
- Pay unfairly.
- Manage the rising expectations.