A Case Study Compilation of the Amazing HR Practices That Make Google the Benchmark to Learn From
Using any set of assessment criteria, Laszlo Bock of Google has been in the vanguard in creating revolutionary change in the profession of HR to the point where he has earned the title of “HR professional of the decade.” Under his leadership, Google has literally led the way in innovation in all aspects of HR and it has become the world’s only data-driven HR function. Its willingness to continuously try completely unique approaches has resulted in Google being rated the No. 1 best place to work by numerous independent groups (Fortune six times, Fast Company, Glassdoor, Universum, and LinkedIn).
Working at Google has such a powerful employer brand draw that it receives an unparalleled 3 million applications a year, even though applicants only have an estimated 0.2 percent percent chance of getting hired.
But it’s more than just image that Mr. Bock has helped to create, because Google’s workforce productivity is simply amazing at $1.23 million per employee each year.
Not only has he molded the HR function at Google in nine short years into the benchmark model that everyone admires, but he has been extraordinary in his willingness to share his knowledge with both HR professionals and potential job applicants. Even though I have been writing and speaking in the HR field for three decades, I have never come across a leader who deserved the title of HR professional for an entire decade. HR is a unique field where very few corporate HR leaders are known by name throughout the profession but Laszlo Bock is clearly the exception, primarily because he openly shares what he has learned, even when it runs counter to standard HR thinking.
An Overview of the Amazing People Management Practices at Google
You have undoubtedly heard about the free food, nap rooms, and the 20 percent time at Google, but those are minor practices representing the tip of the iceberg. This article highlights dozens of amazing people-management practices that taken together as a body of work, simply define the phrase “bold innovation” in the HR space.
As the leader of an amazing people opps team, he (as well as his team and the senior management at Google) deserves credit for encouraging the development of some amazing people-management programs, approaches, and features. Even though the offerings are constantly changing, the ones cited here serve as illustrations covering the types of innovation that he has nurtured over his tenure. Whenever possible, I have used their words or public quotes to describe Google’s practices.
Top-ranked business results — the HR team and the managers at Google have put together people-management approaches that contributed to some amazing business results. They include Google being ranked as the No. 1 product brand, the No. 2 most valuable firm in total market capitalization and its profit margins are among the best at over 20 percent.
The first truly data-driven HR function — in my experience, no other HR function even comes close when it comes to being dominated by analytics.
“Don’t trust your gut: use data to predict and shape the future” (Laszlo Bock).
Rather than relying (as most do) on intuition, past practices, and benchmarking, “[we want to] bring the same level of rigor to people-decisions that we do to engineering decisions,” (Prasad Setty).
Its world-famous people analytics team isn’t an isolated activity; instead it’s a way of doing business.
“We apply the same level of rigor, analysis, and experimentation on people as we do the tech side” (Jennifer Kurkoski). “All people decisions at Google are based on data and analytics” (Kathryn Dekas).
Rather than demanding or forcing managers to accept their HR approach, they instead act as internal consultants and influence managers to change based on the powerful data that they present to change preset opinions. They have used data to improve manager performance, to increase collaboration, to improve performance appraisals, to understand employee happiness, and even to improve compensation.
“Pay unfairly, it’s more fair!” (Laszlo Bock).
In addition to traditional metrics, Google excels at using forward-looking predictive analytics in the areas of recruiting, retention, happiness, and improving managers …“data can be a way at getting to the truth” (Laszlo Bock).
An applied R&D team that experiments on people management problems — the first firm to develop this truly groundbreaking approach, its “People and Innovation Lab” (PiLab) is where for the first time, the scientific method meshed with HR. “We apply science to organizational issues as well” (Jennifer Kurkoski).
Google is the only firm that regularly conducts A/B tests and applied control group experiments within Google to determine the most effective approaches for managing people and maintaining a productive environment.
“Run experiments … Take two groups with the same problem, and try to fix it for just one … By comparing between the groups, you’ll be able to learn what works and what doesn’t” (Lazlo Bock).
The team has analyzed a variety of diverse issues including employee happiness, what makes onboarding effective, how to improve managers, how to encourage increased employee retirement savings, how to combat decision fatigue, and which rewards make employees the happiest. It even improved employee health without objection by reducing the calorie intake of its employees by making unhealthy food less visible and cutting the size of the serving plates.
No one comes close to making a superior business case for HR —perhaps the best-kept secret about Laszlo Bock and his team is their ability to make a powerful and compelling business case. Almost every HR function that I come across continually struggles to get extra budget and resources. They should all learn a lesson from Mr. Bock’s team, which is unmatched in making an internal business case (better than many finance teams that I have encountered).
For example, Google’s HR team (it calls it people operations or POPS) put together a breathtaking business case for recruiting, which resulted in the company spending double the percentage of its overall HR budget on hiring, compared to the average firm. Fortune magazine once estimated that Google had an amazing one recruiting professional for every 58 employees (58-1 where the average is nearly 577-1). Even executives get involved in building the business case for top talent. For example, the senior vice president of knowledge, Alan Eustace (who Mr. Bock calls Google’s best recruiter) contributed to the focus on top performers when he calculated that top engineer hires were worth “300 times or more than the average” hire. As a result of this powerful recruiting business case and the calculated performance differential, Google is one of the few firms that can successfully practice “top grading,” which aims to hire exceptional talent in each and every job.
No one can match Google recruiting — Google is one of the few firms that can successfully practice “top grading,” which requires you to hire exceptional talent in each and every job.
“Only hire people who are smarter than you are, no matter how long it takes to find them” (Laszlo Bock).
I have labeled Google a “recruiting machine” because its approach is unique across all industries. To start off, chairman Eric Smith has made it clear that “hiring is the most important thing you do.” Because of its paramount importance, Google is both data-driven and unique. For example, all hiring decisions are made by a hiring committee rather than individual managers. This is because hiring managers can be extremely short-term oriented and “managers often want to hire people who seem just like them. So hiring decisions are made by a group” (Laszlo Bock) based on a consensus.
Google’s data-driven recruiting team has identified predictive hiring criteria and it is one of the few firms to use a statistical algorithm for hiring. Its data-driven approach has also proven the low ROI of job boards and the low long-term predictive value of common selection criteria including GPAs, test scores, brainteaser questions and unstructured interviews.
“Most interviews are a waste of time” (Laszlo Bock).
It has demonstrated that hiring speed directly impacts hire quality (and as a result, it reduced hiring time from what once took “six to nine months” (Laszlo Bock) down to an average of 47 days. Its research also proved that interviews beyond four added little predictive value, a dramatic change from the past where candidates “sat for 15 to 25 interviews” (Laszlo Bock). Its Project Buffet makes referrals easy because employees can quickly access stories about Google’s culture, people,e and products.
Google’s on-campus “ambassador program” is in my experience the world’s most-effective college recruiting tool, because it allows a constant physical presence on campus. It revisits past “silver medalist” candidates with its “classroom” and “Janus” approaches to make sure the top candidates weren’t missed the first time around.
It estimates the future trajectory of exceptional candidates and excels at using contests to identify not-looking prospects. More than 35 percent of new hires occur under the buddy hiring process, and its classic “math problem billboard” remains one of the most unique approaches of all time for attracting STEM talent. And finally Google has the most specialized recruiting related jobs (at least 15 distinct roles) of any firm that I have ever come across.
Simply the best at innovation and collaboration — Google has an extraordinary focus on increasing employee freedom.
“If you’re comfortable with the amount of freedom you’ve given your employees, you haven’t gone far enough” (Laszlo Bock).
Freedom also increases collaboration between employees who work in different functions. Their 20 percent time gives most engineers the freedom to work on their own innovative projects, and their manager can’t say no.
“Take away managers’ power over employees” (Laszlo Bock).
Google has found that increased innovation comes from a combination of three factors: discovery (i.e. learning), collaboration, and fun. It scientifically changes the colors and designs physical workplaces to maximize learning, fun, and collaboration (and tracks the time spent by employees in the café lines to maximize collaboration).
Managing “fun” may seem superfluous to some, but the data indicates that it is a major factor in attraction, retention, and collaboration. Google has a “150-foot” away from food rule, café tables are designed to maximize interaction, Thursday night CEO chats, and on the main campus, there is even a laundromat to facilitate collaboration. It discourages telecommuting because of the importance of being onsite for serendipitous meetings which increase collaboration. As a result, Google as a firm excels in innovation in multi-areas including search, mobile phones, Google glass, driverless cars, fast Internet connectivity, YouTube videos, and maps.
Internal movement is facilitated in unique ways — Google’s “Magnet” career development website allows workers to better manage their careers. Employees can tag themselves within Magnet as “looking for new opps” if they want to be considered for open positions. Employees can also see what specific careers paths other employees have taken. Employees can also build internal networks, where searches and conversations between employees are private. The Magnet rotational program allows engineers to choose and then test out other engineering roles for three months. After three months, with approvals, they can choose to stay in the team. Some less glamorous internal groups have offered employees and new grads a $5,000 sign-on bonus for a six-month assignment. After six months, they can stay or choose to leave to any other general software roles they can get at Google. Google also has an “internal mobility team” made up of specialized recruiters who proactively facilitate internal employee movement across all business units.
Google is unique in that employees self-nominate themselves or their peers for promotions. They can get career and technical advice through additional programs, including the “CareerGuru” program where senior leaders provide career coaching and “EngAdvisors” which allows engineers to discuss concerns with senior engineers. Internal networks like MOMA and Snippets keep everyone informed about progress on major projects and what individual engineers are working on at any one time.
gDNA reveals the secret to maintaining long-term employee happiness – The PiLab’s gDNA 100-year long-term pursuit of happiness study surveying current and former employees is unique in the corporate world. Over time it may help cultivate better leaders and keep employees engaged for longer periods of time. Google’s Analytics team discovered that “being grateful and expressing it” is the best way to maintain higher levels of happiness. Employees who are more grateful are “largely immune to the sinking effects of tenure on satisfaction” and “they stay happier, longer” (Laszlo Bock).
“The data from gDNA allows us to flex our people practices in anticipation of our peoples’ needs” (Laszlo Bock).
Managed happiness may lead to better employee productivity, innovation, and retention.
The world’s only data-driven diversity effort —Google was the first major firm to publicly release its diversity data, and it has donated millions to early-stage STEM women development programs. Google also has a track record of applying data to measurably improve the hiring, promotion, and retention of women. Google has innovated by allowing women to rewrite job descriptions to make a job more attractive to other women. Recently in one global region, various recruiting teams launched “interview preparation calls” to support female candidates prior to their onsite interviews. Google has also been running sessions covering “unconscious bias” that a majority of its workers have voluntarily participated in.
Its retention approach breaks new ground — because it attracts the very best that other firms desire, Google must constantly focus on retention. Google is unique in that it has developed a predictive algorithm to proactively and successfully predict which employees “feel underused” and are therefore most likely to become a “flight risk” problem. This algorithm allows management to “get inside people’s heads even before they know they might leave” (Laszlo Bock).
Google has also learned that poor performers drive away top performers as illustrated by this quote: “Never ever, ever compromise on quality.” It’s toxic if people see poor performers all around them … they decide they don’t need to work that hard. Your very best people will leave” (Laszlo Bock).
Since a top cause of turnover is having a weak manager, Google used “project oxygen” to put together a list of the eight actions and behaviors (oxygen attributes) that made managers more effective (initially 75 percent of struggling managers improved). Google also surveys employees about their manager twice a year, and the survey is unique in that more than 90 percent of employees do not take it anonymously. They also use the “big scrub” to fix weak policies or rules. Under it, every quarter employees list and then vote on the top 20 rules they want to see changed. Google pledges to fix those rules within two months. And finally Google has held a “bring your parents to work day,” which helps to build family support for working at Google.
No one puts a greater emphasis on continuous learning and agility — the one single hiring factor that is emphasized across all jobs is learning.
“Learning ability is the key determiner in deciding among candidates” (Laszlo Bock).
Self-directed learning is enhanced using unique approaches from “testing on the toilet” to “gLearn classes” to “Talks at Google,” which has invited over 1,700 external speakers including Barack Obama, Bill Nye, Salman Rushdie, Bob Woodward, and Lady Gaga to speak and answer employee questions. Google also focuses on hiring and retaining “people who are comfortable with ambiguity” (Prasad Setty). In a VUCA world, it is essential to have employees who are “quick-learning generalists who can master whatever challenges are thrown at them” (Laszlo Bock).
A unique HR team — Google’s unique approach to people management comes in part because the intellectually curious Mr. Bock has staffed his HR team with intellectually curious individuals from backgrounds that are rare in HR.
“Only a third of Google’s people operations staff has typical HR backgrounds; the rest come from generalist consulting firms or research fields such as psychology and physics” (Laszlo Bock).
By continuously streamlining HR processes, people operations has improved its own productivity 6 percent a year for the past five years without outsourcing HR functions or increasing its use of HR vendors or consultants” (Michelle Rafter). Even with all of their successes, HR is always in learning mode.
“Learn from your best employees, and your worst” (Laszlo Bock).
In short, Mr. Bock has developed this revolutionary approach while simultaneously reducing HR costs per employee. He has also reduced the time that Google employees need to spend on HR activities; for example, the average employee once spent an average of 10 hours per week on recruiting activities but that number has been reduced to nearly 1.5 hrs. per week.
Helping jobseekers — Mr. Bock also excels at sharing his knowledge and expertise with jobseekers. He has provided powerful detailed information on how to write a perfect resume, how to interview, and what it takes to get a job at top firms like Google.
As someone who has researched, visited, and written about Google for over a decade (Note: I have never had any financial relationship with Google), I am continually amazed about how it are able to come up with amazing and unique people-management practices on a continuous basis. Its level of innovation and its willingness to share it is certainly unique within HR, so I unabashedly assigned credit for these accomplishments at Google to its leader, Laszlo Bock. Incidentally, Bock continues his transparency and sharing of the best practices at Google in his book “Work Rules! Insights from Inside Google that Will Transform How You Live and Lead.” Because of his extraordinary leadership, his serving as a role model, and his continuous innovation in HR, I call him “the HR professional of the decade.”
If you know of other corporate leaders who rival Bock’s contributions, feel free to list them in the comments section following this article on ERE.net.
As seen on ERE Media on 3/30/2015.