GOOGLE*
Fortune magazine named Google the best of the 100 best companies to work for, and
there is little doubt why. Among the benefits it offers are free shuttles equipped with
Wi-Fi to pick up and drop off employees from San Francisco Bay area locations,
unlimited sick days, annual all-expense-paid ski trips, free gourmet meals, five on-site
free doctors, $2,000 bonuses for referring a new hire, free flu shots, a giant lap pool, on-site oil
changes, on-site car washes, volleyball courts, TGIF parties, free on-site washers and dryers
(with free detergent), Ping-Pong and foosball tables, and free famous people lectures. For many
people, it’s the gourmet meals and snacks that make Google stand out. For example, human
resources director Stacey Sullivan loves the Irish oatmeal with fresh berries at the company s
Plymouth Rock Cafe, near Google s people operations group. I sometimes dream about it, she
says. Engineer Jan Fitzpatrick loves the raw bar at Google s Tapis restaurant, down the road on
the Google campus. Then, of course, there are the stock options each new employee gets
about 1,200 options to buy Google shares (recently worth about $480 per share). In fact,
dozens of early Google employees ( Googlers ) are already multimillionaires thanks to Google
stock. The recession that began around 2008 did prompt Google and other firms to cut back on
some of these benefits (cafeteria hours are shorter today, for instance), but Google still pretty
much leads the benefits pack.
For their part, Googlers share certain traits. They tend to be brilliant, team oriented
(teamwork is the norm, especially for big projects), and driven. Fortune describes them as
people who almost universally see themselves as the most interesting people on the
planet, and who are happy-go-lucky on the outside, but type A highly intense and goal
directed on the inside. They’re also super-hardworking (which makes sense, since it s
not unusual for engineers to be in the hallways at 3 A.M. debating some new mathematical
solution to a Google search problem). They’re so team oriented that when working on
projects, it’s not unusual for a Google team to give up its larger, more spacious offices and
to crowd into a small conference room, where they can get things done. Historically,
Googlers generally graduate with great grades from the best universities, including
Stanford, Harvard, and MIT. For many years, Google wouldn’t even consider hiring
someone with less than a 3.7 average while also probing deeply into the why behind any
B grades. Google also doesn’t hire lone wolves, but wants people who work together and
people who also have diverse interests (narrow interests or skills are a turnoff at Google).
Google also wants people with growth potential. The company is expanding so fast that
it needs to hire people who are capable of being promoted five or six times it s only, the
company says, by hiring such overqualified people that it can be sure that the employees
will be able to keep up as Google and their own departments expand.
The starting salaries are highly competitive. Experienced engineers start at about
$130,000 a year (plus about 1,200 shares of stock options, as noted), and new MBAs
can expect between $80,000 and $120,000 per year (with smaller option grants). Most
recently, Google had about 10,000 staff members, up from its beginnings with just
three employees in a rented garage.
Of course, in a company that s grown from three employees to 10,000 and from zero
value to hundreds of billions of dollars, it may be quibbling to talk about problems, but
there’s no doubt that such rapid growth does confront Google s management, and
particularly its people operations group, with some big challenges. Let’s look at these.
For one, Google, as noted earlier, is a 24-hour operation, and with engineers and
others frequently pulling all-nighters to complete their projects, the company needs
to provide a package of services and financial benefits that supports that kind of
lifestyle, and that helps its employees maintain an acceptable work life balance.
As another challenge, Google s enormous financial success is a two-edged sword.
Although Google usually wins the recruitment race when it comes to competing for
new employees against competitors like Microsoft or Yahoo!, Google does need some
way to stem a rising tide of retirements. Most Googlers are still in their twenties and
thirties, but many have become so wealthy from their Google stock options that they
can afford to retire. One 27-year-old engineer received a million-dollar founder s
award for her work on the program for searching desktop computers, and wouldn’t
think of leaving except to start her own company. Similarly a former engineering
vice president retired (with his Google stock profits) to pursue his love of astronomy.
The engineer who dreamed up Gmail recently retired (at the age of 30).
Another challenge is that the work not only involves long hours but can also be very
tense. Google is a very numbers-oriented environment. For example, consider a typical
weekly Google user interface design meeting. Marisa Meyer, the company’s vice president
of search products and user experience, runs the meeting, where her employees work out
the look and feel of Google s products. Seated around a conference table are about a dozen
Googlers, tapping on laptops. During the 2-hour meeting, Meyer needs to evaluate various design
proposals, ranging from minor tweaks to a new product s entire layout. She s previously given
each presentation an allotted amount of time, and a large digital clock on the wall ticks off the
seconds. The presenters must quickly present their ideas, but also handle questions such as what
do users do if the tab is moved from the side of the page to the top? Furthermore, it’s all about
the numbers no one at Google would ever say, for instance, the tab looks better in red you need
to prove your point.
Presenters must come armed with usability experiment results, showing, for instance,
that a certain percent preferred red or some other color. While the presenters are
answering these questions as quickly as possible, the digital clock is ticking, and when it
hits the allotted time, the presentation must end, and the next team steps up to present.
It is a tough and tense environment, and Googlers must have done their homework.
Growth can also undermine the outlaw band that’s changing the world culture that
fostered the services that made Google famous. Even cofounder Sergi Brin agrees that
Google risks becoming less zany as it grows. To paraphrase one of its top managers, the
hard part of any business is keeping that original innovative, small-business feel even as
the company grows.
Creating the right culture is especially challenging now that Google is truly
global. For example, Google works hard to provide the same financial and service
benefits every place it does business around the world, but it can’t exactly match its
benefits in every country because of international laws and international taxation
issues. Offering the same benefits everywhere is more important than it might initially
appear. All those benefits make life easier for Google staff, and help them achieve a
work life balance. Achieving the right work life balance is the centerpiece of Google s
culture, but this also becomes more challenging as the company grows. On the one
hand, Google does expect all of its employees to work super hard; on the other hand,
it realizes that it needs to help them maintain some sort of balance. As one manager
says, Google acknowledges that we work hard but that work is not everything.
Recruitment is another challenge. While Google certainly doesn’t lack applicants,
attracting the right applicants is crucial if Google is to continue to grow successfully.
Working at Google requires a special set of traits, and screening employees is easier
if it recruits the right people to begin with. For instance, Google needs to attract
people who are super-bright, love to work, have fun, can handle the stress, and who
also have outside interests and flexibility.
As the company grows internationally, it also faces the considerable challenge of
recruiting and building staff overseas. For example, Google now is introducing a new
vertical market- based structure across Europe, to attract more business advertisers to
its search engine. (By vertical market- based structure, Google means focusing on key
vertical industry sectors such as travel, retail, automotive, and technology.) To build
these industry groupings abroad from scratch, Google promoted its former head
of its U.S. financial services group to be the vertical markets director for Europe;
he moved there recently. Google is thus looking for heads for each of its vertical
industry groups for all of its key European territories. Each of these vertical market
heads will have to educate their market sectors (retailing, travel, and so on) so Google
can attract new advertisers. Google already has offices across Europe, and its London
office had tripled in size to 100 staff in just 2 years.
However, probably the biggest challenge Google faces is gearing up its employee
selection system, now that the company must hire thousands of people per year.
When Google started in business, job candidates typically suffered through a dozen
or more in-person interviews, and the standards were so high that even applicants
with years of great work experience often got turned down if they had just average
college grades. But recently, even Google s cofounders have acknowledged to security
analysts that setting such an extraordinarily high bar for hiring was holding back
Google s expansion. For Google s first few years, one of the company s cofounder s
interviewed nearly every job candidate before he or she was hired, and even today one
of them still reviews the qualifications of everyone before he or she gets a final offer.
The experience of one candidate illustrates what Google is up against. A 24-year-old
was interviewed for a corporate communications job at Google. Google first made contact with
the candidate in May, and then, after two phone interviews, invited him to headquarters. There he
had separate interviews with about six people and was treated to lunch in a Google cafeteria.
They also had him turn in several homework assignments, including a personal statement and a
marketing plan. In August, Google invited the candidate back for a second round, which it said
would involve another four or five interviews. In the meantime, he decided he’d rather work at a
start-up, and accepted another job at a new Web-based instant messaging provider.
Google’s new head of human resources, a former GE executive, says that Google is
trying to strike the right balance between letting Google and the candidate get to know
each other while also moving quickly. To that end, Google recently administered a
survey to all Google’s current employees in an effort to identify the traits that correlate
with success at Google. In the survey, employees responded to questions relating to
about 300 variables, including their performance on standardized tests, how old they
were when they first used a computer, and how many foreign languages they speak. The
Google survey team then went back and compared the answers against the 30 or 40 job
performance factors they keep for each employee. They thereby identified clusters
of traits that Google might better focus on during the hiring process. Google is also
moving from the free-form interviews it used in the past to a more structured process.
Instructions
Answer the following questions in a two-page paper using the following format: Times New
Roman, size 12, single-spaced.
1. Select and critique three potential strategic HR issues in the Google case in the areas of total
rewards and employee engagement. What are the ethical considerations?
2. Many employees can afford to retire young because of the earnings they get from the stock
option. How can management address this particular strategic HR problem in terms of the link
of attrition to total rewards?
3. If you were to localize the rewards program of Google, what creative non-monetary benefits
can you propose to motivate and instill commitment in the organization, while ensuring to
maintain its strategic position and competitive advantage?
4. To support its growth and expansion strategy, Google wants (among other traits) people who
are super-bright and who work hard, often round-the-clock, and who are flexible and maintain
a decent work–life balance. List five specific employee engagement policies or practices that
you think Google should implement to support its strategy, and explain your answer.
