SWOT Analysis on Google’s Inc. approach to Culture Management

Questions

1. Evaluate the overall strengths and weaknesses of Google’s approach to culture management in relation to its vision and strategies (30% of total available marks)

2. Referring to the last section in the case on ‘Weaknesses in the Google Approach’, evaluate the specific problems identified by Sullivan and suggest ways that they might be dealt with in the future. Collectively, do they add up to a significant problem for Google (50% of total available marks).

3. What lessons can other companies learn from Google’s talent management practices? To what extent are they transferable to other contexts and time periods? (20% of total available marks)

A Look inside Google’s Talent Management Machine

Google Inc. is a US-based corporation that is best known for developing a widely-used internet search engine, e-mail system, online mapping, office productivity, social networking and video-sharing services. It earns its revenues from linking advertising to these services as well as selling advertising-free versions of them to clients seeking corporate solutions to their technology problems. The Google headquarters is located in its Googleplex at Mountain View California, but it has recently opened offices in New York, Ann Arbor and Pittsburgh in the USA, and in Europe, Asia and Australia. Since being founded by Larry Page and Sergey Brin in 2006 and going to public offering in 1998, it has grown remarkably to become one of the world’s most powerful brands and has been identified quite a few times as one of the ‘Best Places to Work’ by Fortune Magazine.   By December 2008 the company had 20,222 full-time employees.

Google, through its branding, PR and recruiting efforts, has made itself so well-known and attractive to professionals from every industry and university in the USA and in other countries in which it has offices that they have essentially changed the talent management ‘game’ of recruiting forever. Google attracts more than a million applicants per year for approximately 10,000 vacancies, which will double its size in a single year.   Because of its growth, vision and need for highly talented people it has developed a ‘recruiting culture’ and among the most innovative HR practices in the world, at least according to John Sullivan, a San Franciscan academic who studies them closely. The following paragraphs are a précis of Sullivan’s insights in Google’s people management and talent management practices coupled with insights into Google from the Economist and other sources.

Google current vision, as articulated by Brin in December 2008, is to make the world’s information ‘universally accessible and useful’. In addition, Google has recently established Google.org, its philanthropic arm. Its specific mission, through both for-profit investing and making charitable grants, is to ‘eclipse Google itself in overall world impact by ambitiously applying innovation and significant resources to the largest of the world’s problems’.

Google’s Talent Strategy – ‘the world’s first recruiting culture’

These visions of the future colour all aspects of Google’s sometimes ‘quirky’ management and leadership practices, no more so than talent management. According to Sullivan, Google has ‘accomplished something that no other corporation has ever accomplished’ to deliver the company’s ambitious aims.   Since 1998, it has developed a ‘recruiting machine’ to create a talent management culture that permeates the entire organization. This applies from senior leaders to the entry-level employees and has largely been done at the behest of the two founders, whose vision touches virtually all aspects of Google. Talent management, however, does not only refer to recruitment, which is obviously a key function in a rapidly growing company, but also to changing the ways in which employees work to ‘attract and retain the very best’.

‘Working with 20 per cent time’
Sullivan points out that ‘many organisations have changed their pay or benefits in order to attract better workers, but few have changed every professional job in the company so that the work itself is the primary attraction and retention tool’. Rather than leaving work design, job design and job descriptions in the hands of out of touch people in corporate compensation, Google’s two founders, HR director Stacy Sullivan and the leadership team at Google have designed all professional job and features of the workplace so that all employees are working on interesting projects, learning continuously and are being constantly challenged. Without using the terms, Google is striving to become a learning organization ‘par excellence’.
The key element of changing the work so that the work itself becomes a critical attraction and retention force and driver of innovation and motivation is what Google calls ‘20 per cent work’. There is no concrete definition of what 20 per cent work means, but generally for professional employees it means working the equivalent of one day a week on their own, researching individually selected projects that the company funds and supports. This idea is not new, having been popularised by other innovative companies in the 1980s, including 3-M. However, it has been effective. Both the Google Groups and Google News products are reported to have started as a result of personal 20 per cent time projects. In addition to being an important attraction message for the kinds of people that Google seeks to recruit, it also keeps their attrition rate at, as one HR executive put it “almost nil”, (in reality around 5%) but its greatest value is that it drives innovation and creativity throughout the organisation.

‘The world’s largest recruiting budget’
Sullivan argues that Google recruiting is the ‘best-funded recruiting function in any major product-driven corporation’. The statistics he uses to evidence this are impressive and show how important this element of talent management is to a fast growing company in the technology sector. ‘Google recruitment has a ratio of one recruiter for every 14 employees (14:1). That ratio surpasses the average ratio of 100 employees to 1 HR recruiter in the USA.

‘The benefits are highly attractive’
Google’s attraction, motivation and retention strategy is based on ‘spectacular’ benefits, though they are not just designed for HR related reasons but to encourage collaboration, to break down barriers between functions and to stimulate individual creativity and innovation (see Table 1). The benefits package does attract and presumably helps retain a percentage of “wrong people”, that is, talented individuals who are seeking benefits rather than an opportunity to do their best work. The company recognises that such an employer of choice strategy is not without its problems, which creates a screening and retention challenge.

Table 1. Employee benefits at Google A partial list of Google’s benefits include:·         Flexible hours for nearly every professional employee·         Casual dress everyday·         Employees can bring their dogs to work·         Onsite physician and dental care·         Health benefits·         Free massage and yoga ·         Stock options ·         Free drinks, snacks and meals, including breakfast, lunch and dinner ·         Three weeks’ vacation during the first year ·         Free recreation, including video games, foosball, volleyball and pool tables ·         Valet parking for employees ·         Onsite car wash and detailing ·         Maternity and parental leave (plus new mums and dads are able to expense up to US$500 for take-out meals during the first four weeks that they are home with their new baby) ·         Employee referral bonus program ·         Near site childcare centre ·         Backup childcare for parents when their regularly scheduled child care falls through ·         Free shuttle service to the main campus ·         Fuel efficiency vehicle incentive program ·         Onsite dry cleaning, plus a coin-free laundry room ·         A Friday TGIF all-employee gathering where the founders frequently speak ·         A “no tracking of sick days” policy ·         An onsite gym to work off all of the snacks

Google Recruiting Structure
Google has ambitious growth plans, which means doubling its workforce over the period of a few years. To achieve this aim the recruitment structure they have designed to enable such growth is, like most successful recruiting organisations, primarily a centralised operations model.

A key tenet of any successful recruiting function is that the function has the capability to handle in-house the most important and visible positions, that is, the search for future leaders. At Google, recruiting is responsible for filling both executive leadership and top-level technical positions, which makes it even more of a core function in delivering strategic aims.

According to Sullivan, ‘Because Google believes wholeheartedly in sourcing the best talent that is ferociously sought after by competitors, every element of the recruiting function is abundantly staffed with highly focused professionals’.

The recruiting model has been broken up into very distinct roles, each requiring specialised expertise. These activities, carried out in a highly choreographed manner by teams tied to divisions and business units, include: recruiting research analysts; candidate developers (‘sources’); process coordinators; candidate screeners; specialised recruiters for college; specialised recruiters for technical and leadership executive search; specialised international recruiters to be located in Asia and Europe; recruiting program managers; and recruiting project managers. Such specialisation enables the function to be managed in a way similar to a supply chain.

The company employs a range of standard and company specific recruitment tools, the latter of which it regards as key to its operations and something of a set of ‘signature’ practices.

Standard recruiting tools
Google has successfully implemented many of the standard best practice tools found at other companies:

• Employee referral programmes: Google’s referral program is without any industry leading features, but the company’s strong brand coupled with its highly enthusiastic workforce makes up for weaknesses in the program.
• University recruitment: Google hires a large number of PhDs on the premise that they enjoy exploring areas that no one else has explored. To accomplish this, they have developed a network of direct relationships with over 350 professors at major schools. In addition, Google has an outstanding internship program that has a very high conversion rate to permanent hires.
• Professional networking: Google also effectively uses social networking groups like Linkedin and other live professional events to recruit top performers.
• Recruiter training: Google is one of only a handful of companies that requires most newly hired recruiters to go through extensive recruiter training prior to starting.

 

Key ‘Signature’ Recruiting tools

Google employs a variety of impressive recruiting tools including:

• AdWords as a recruiting tool: Because Google is recognised as the master of search, it’s not surprising that they utilise their own search tool to find top candidates without active resumes.
• Contests as recruiting tools: The Google Code Jam, as they call it, is a global online software writing contest that can attract over 7,500 people each year. The top 25 finalists are invited to the Mountain View campus to compete for US$50,000 in prizes as well as a chance to work at Google.
• Brain teasers as recruiting tools: Google has placed brainteaser billboards in the Silicon Valley and by Harvard Square. The math puzzles on these billboards challenge mathematics-oriented people and get them thinking. Although they do not specifically mention Google, the billboard puzzle does eventually lead interested participants to the Google site.
• Friends of Google: This tool creates an electronic email network of people that are interested in Google and its products but not necessarily interested in working for the company. Thus, Google can build a relationship with thousands of people that like the firm.
• Data-driven approach to candidate assessment. The latest innovation from is a new assessment tool that relies on an algorithm to more accurately identify candidates who resemble existing top performers. The algorithm enables Google to include candidates who might otherwise be overlooked as it evaluates a much wider range of potential success predictors than can normally be discerned from most resumes. It is argued that this innovation recognises and resolves a major flaw inherent to typical assessment methodologies that rely too heavily on academic grades, school scores, degrees from top schools, prior industry experience and subjective interview results.

‘Weaknesses in the Google approach’

Sullivan has recognised that Google recruiting is not without weaknesses, though qualifies this criticism by suggesting that they aren’t significant threats. However, in a company whose slogan is “great isn’t good enough”, he argues that it’s critical that HR and recruitment management spend some time and resources in the following areas:

• Employment branding: Although Google is clearly well-known as a great employer, it is clear that much of that recognition has come as a result of programs and ideas that originated outside of HR. What can Google do to develop a distinctive employer brand?
• Metrics: Both the HR and the recruiting function have dragged their feet on developing metrics to show that investment in talent management pays. He singles out on-the-job performance of new hires but flags up an important failing of HR generally, which is the failure to assess the effectiveness of what they do.
• Recruiting strategy: Although Google recruiting obviously carries out lots of innovative recruiting activities, they seem to occur at random and in spite of the fact that there is no formal, well-communicated recruitment strategy.  Is there a need to formalise the informal? Or should they leave what works alone?
• Speed: Like other companies where who you let in is critical, e.g. Apple and some of the management consulting companies, many candidates report on Google ‘comments’ how slow the screening, recruiting, and interview process is. How can this be speeded up, or should it be speeded up?
• Contingent labour: The number of temporary workers and contractors in the recruiting function at Google is very high.  Google seems to be unwilling to give permanent jobs immediately to recruiters, which may reduce Google’s ability to employee experienced recruiters that look for a certain level of stability.
• Emphasis on youth: Google’s emphasis on youth culture might hurt its ability to attract more senior and experienced personnel.