How Google's Novel Management System Aids Growth 156
Carl Bialik from WSJ writes "Gary Hamel, visiting professor at London Business School, argues in a Wall Street Journal commentary that Google's 'novel management system seems to have been designed to guard against the risk factors that so often erode an organization's evolutionary potential.' Among Google's advantages: The 20% rule, an 'expansive sense of purpose' and the credo, 'keep the bozos out and reward people who make a difference.' Hamel also traces the company's evolution from Google 1.0, 'a search engine that crawled the Web but generated little revenue,' to Google 5.0, 'an innovation factory that produces a torrent of new Web-based services, including Gmail, Google Desktop, and Google Base. More than likely, 6.0 is around the corner.'"
Re:Googles problem will be their increasing size (Score:3, Insightful)
The Friendly Giant... (Score:3, Insightful)
All that said, how long can Google really maintain it's unorthadox business methods while allowing VERY orthadox investors to buy stocks in the company. I'd say it's only a matter of time, and the price for become a truly large corporation. I can only hope that I am wrong.
Remember when Yahoo was the darling? (Score:2, Insightful)
As a previous poster said, as it gets bigger, things will not go as well. Just as everyone turned on MicroSoft, I'm sure one say everyone will turn on Google as well. We're a fickle industry.
Re:Googles problem will be their increasing size (Score:5, Insightful)
I completely agree with you. Those big companies are in trouble. IBM after all showed only a 25% growth in profit for Q1 2006. And, just a few minutes before I posted this, Microsoft announced a small jump of 16% growth in profit AND a 13% growth in revenue. Leaving the tech industry, Exxon Mobile had a horrible quarter with only $89 Billion in Revenue.
Yeah, those large companies, they are just falling apart....Oh, wait...
God I hope it lasts... (Score:1, Insightful)
Eh, at least that's what I've seen happen. Hope I don't get modded down too much by angry managers.
Re:Ah yes (Score:3, Insightful)
Re:The Friendly Giant... (Score:3, Insightful)
More products and more inovation means more dollars. more dollars means hap-hap-happy investors. now if only Google would hire me.
I would take issue with one point from the article (Score:5, Insightful)
Elitism may be out of fashion, but Google is famously elitist when it comes to hiring. It understands that companies begin to slide into mediocrity when they start to hire mediocre people. A-level people want to work with A-level people.
The only problem is that a company cannot thrive longterm with only A-level people. As a software company grows and matures so the average age of the company code base increases, and there's a gradually increasing requirement for maintenance of the older products. A-level people rarely consider their primary task in life is settling in as a maintenance coder on products that are no longer considered to have a substantial "wow" factor.
Having said that, code maintenance can be some of the most demanding work around, as programmers are asked to come up to speed on outdated code they didn't write and make it do things it was never designed to do. But, speaking generally, this isn't considered something that will make you stand out in your company and it's not where A-level people want to be.
Equally well, having everyone take a turn at maintenance doesn't work either. I would imagine that there's few programming tasks worse than taking over code that's been maintained by half a dozen people who only wanted to move on to other things. You probably aren't going to get any of the awards mentioned in the article by burying yourself in old code, regardless how valuable that might be.
Re:I would take issue with one point from the arti (Score:5, Insightful)
The whole point of googles flat structure makes it possible to have maintenance be a sexy task within the organization by allowing rewards to go where they should go too. I would say that 'most companies' create the hierarchy because they don't have the guts to manage the way that google does.
I've worked at far too many companies where the disconnect between espoused values and actual values create the kind of situation you describe (ie maintenance coding is a loser job, best avoided or gotten promoted out of).
Re:God I hope it lasts... (Score:4, Insightful)
Re:God I hope it lasts... (Score:5, Insightful)
Bozos, etc. (Score:5, Insightful)
Well, everybody does that, don't they? Even the Bush administration does that. The key is in your perception of who the bozos are, and who makes a difference...
Re:Googles problem will be their increasing size (Score:3, Insightful)
-Chris
Ironic that they have to buy other companies (Score:2, Insightful)
With all of the "brainpower", what makes headlines? The products of companies they bought (not the products developed from within) and copies of other companies' products:
- Google Earth (originally developed externally by Keyhole)
- Skechup (originally developed externally by @Last Software)
- Writely (originally developed externally by Upstartle)
- dodgeball social networking (originally developed externally by dodgeball.com)
- GoogleTalk (instant messaging idea copied from ICQ and others)
- AdWords (patented externally by Overture)
- GMail (internet mail idea copied from Hotmail)
- GoogleMaps (mapping idea copied from Mapquest and others)
This points out there is a flaw in the system. They may have thousands of "little 'Googlettes'" (to quote TFA) running inside of the company, but the true innovation is happening outside of the company. These ideas weren't created by the Mensa-like brains who passed the Google hiring gauntlet.
The article mistakenly says that Google's management ideas are novel, but they aren't; they are copied from a number of other companies, some of which are still around, some of which aren't.
At the end of the day, Google still gets its revenue from advertising, which is no different from any other portal since circa 1996. The quality of Google's core application (search results) is subjective. Google's primary user-interface is trivial (from the end-user's standpoint, it has few states). Easy rise, easy fall.
Ultimately, the question becomes: Who wrote this article? A journalist for the Wall Street Journal? Nope. The article's author is Gary Hamel, who owns a management consulting business. This is a fluff promtional piece he can add to his resume when trolling for new clients. That's why the article is offered for free (no registration required); it's an advertisment.
The greatest irony is that the former senior vice president of engineering at Google pre-IPO and shortly post-IPO was Wayne Rosing (who in 2004 held about 28 million dollars worth of Google stock).
It's my understanding that Rosing has no college degree.
Re:Problem is... (Score:2, Insightful)
That's what the manipulation of money (investment) is, that's its DEFINITION. So some folks don't invest money in the places you would prefer, boo hoo. Some other folks invest money in illegal/immoral ways (monsanto, feedlots, illegal immigrant/h1b hiring to depress wages), petition your representatives and/or change your habits. After 9/11 I rethought aspects of my behavior and chose to not continue driving my Jeep after its lease was up, and instead chose a more efficient and better-for-the-global-environment diesel instead. Would I force everyone to drive diesels and hybrids at gunpoint (the reductio ad absurdum of government mandation)? No. I'd explain things in a complete way and expect people to behave rationally, and I'd make sure that government-based fooling with free market pricing information was at least transparent and fully-documented.
The only thing of real worth is labor.
Wrong. Labor is worth what someone will pay for it. The Labor Theory of Value is entirely and completely wrong and fully debunked by now. For example, if person A will build widgets for $50/hr and person B will build them for $5/hr, guess who gets the job, and guess how much the labor for building widgets is worth? And guess how much labor's worth when robots can build those widgets for $0.05/hr? It might not be comforting or nice, but it's the truth.
Oh, and the LTV corollary that a doctor's labor is worth the same as a ditchdigger is such laughable bullshit that it seems bizarre that folks actually bought into this cultlike concept. Just imagine a country of doctors painting their houses and plumbers sweeping the gutters. Oh wait, the Soviets tried that. SUCKERS...
MBA's should not be paid as handsomely as they are for essentially supervising a company. The goal of a company's CEO should not be making money by whatever means possible, but rather making sure that the company's work and products are the best they can be, as logically, that will make you profitable and that's the only reason you should be profitable.
Wrong. MBAs and CEOs should be paid what the market dictates they be paid. CEOs should make money by any means necessary, since shareholders can fire them for doing less. Now, consumers may choose to buy a product based on intangibles, such as a company's "corporate responsibility" or "environmental sustainability", but make no mistake: any company that behaves in a "responsible" manner only does so for the PR, and as soon as they don't derive an improved rate of return for that PR that leadership will be replaced by a leadership that will. That's the most efficent way of deploying capital, as proven by history.
Now people can either choose to (or to not) patronize companies based on their behavior, or they can use laws or taxes passed by their representatives to set the rules of a particular market, but any government tinkering in and of itself distorts markets in often unpredictable ways, and if you seek to do such things you are morally obliged to be open about it and not try to hide or sugarcoat your agenda.
"To [secure] to each laborer the whole product of his labour, or as nearly as possible, is a most worthy object of any good government."
Sorry Abe, mechanization and the Asian population boom have obsoleted your sentiments. The "whole product" of labor is now what, $7/day in China?
The worthy object of good government now is to help laborers develop skills and productivity that increases the value of their labor, so that they're not put out of the market by mechanization or foreign competition.