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INTRODUCTION
Google, the world’s most popular search engine and home to many other online services such as Gmail was developed in 1996 by Larry Page and Sergey Brin as a research project for Stanford Digital Library Project. The project which was originally called “Backrub” was done as an exploration of mathematical properties of the Worldwide Web. The project launched through the Stanford website in 1997 and by late 1997 the new domain google.com was registered and Google Inc. was formed on September 4th, 1998. Although both founders rejected the idea of advertising funded search engines model they both changed their minds and allowed simple text ads later. The search engine was well accepted by the public and was seen by many as the future of the web. Its technology allowed it to easily surpass the competitors such as Yahoo & AOL.com and was an achievement given that it operated on finance of $100,000 offered by co-founder of Sun Microsystems, Andy Bechtolsheim. In 1999, a further $25 million of equity was sold on the market and the company moved to the complex in Mountain View, California which is now called the Googleplex. In 2000, they introduced a technique of advertising associated with search keywords which gave birth to Adsense, their main revenue stream.
The following analysis evaluates Google’s business model, its culture, how its base resource of HR is used in achieving organisational goals and the implications which might pose threats to the firm in the future.
EVALUATION OF GOOGLE’S ORGANISATIONAL CULTURE
In modern business world, organisational culture does play a dominant part in the success of any business. It is extremely important to understand how modern businesses adopt strategies to attract the best in the business. This work brings out how Google Inc. succeeded in attracting and retaining employees with the organisation by having an innovative organisational culture. Google is said to be one of the very few companies that had a great blend with technological innovation and strong managerial values. Google was selected as the best company to work by fortune in 2008. The Cultural Web (Johnson, 1988) of Google is dominated by this basic paradigm of managerial flexibility, team-working and innovativeness.
Google earned its reputation as one of the most fruitful internet switch on companies and in 2003 Google went on to become the most chosen search engine among the internet users due to its accuracy and speed. Google always had the edge over its competitors not only on technology but on the ability to attract the best employees. During the late 1990s the world went through a technological boom which was known as the dotcom boom. At a time where almost all big tech companies experienced an employee turnover, Google was the only company that did not face a similar crisis. These stories of success allow Google to be placed in the employees mind which spars loyalty and attachment to the company.
To begin with it is important to understand the fact that Google’s removal of any unnecessary managerial hierarchies and this gave Google’s engineers the freedom to work. However on the other hand some are not pleased with this culture and they argue otherwise. They say that Google’s culture is too informal which could result in chaos among both employees and customers. Further they argue that the management structure lacks in unity of command at the top. This organisational structure and control system acts as unique features of Google culture which allows innovations to take place without any barriers.
Google’s global headquarters known as Googleplex is located in Mountain View, California. It, coupled with its logo can be considered as symbols of Google’s culture. Cofounders of Google Larry Page and Sergey Brin always wanted their workplace to be a fun location to work. The entire office complex is decorated with lava lamps and painted in bright colours which reflect their beliefs.
One of the innovative techniques used by Google is that Googlers are allowed to take their pets inside the office. Also they are provided with free snacks and on top of it lunch and dinner is prepared by a celebrity chef Charlie Ayers. They have separate snack rooms offering the employees
with cereals, cashew nuts, fruit juices, and cappuccino at no cost.
Google rented out an entire theatre for a day to accommodate 6000 Googlers to see first run films. That’s what exactly happened for films like ‘Lord of the rings’ and ‘Transformers’ as an extra benefit they were allowed to bring along an additional guest as well. Google moms are allowed 18 weeks of paid maternity leave and dads get seven weeks.
Google has a gymnasium inside their office complex and encourages the employees to have regular workouts to keep themselves in good physical condition and on top of that they have the luxury to take a massage inside the office itself if they want. Also the casual dress code at Google gives Googlers a relaxed homely feeling and helps them to keep their minds off from their busy work schedules. The rituals and routines such as the above symbolizes the values of Google’s management and makes up part of the overall paradigm of their culture.
The emphasis at Google is always on team achievements however at the same time the employees are given proper recognition to take pride in their individual performances as well. In the multi cultured environment of Google such team achievements may be given weightage differently based on the country where they work. In eastern countries, such as Google in China, collectivism can work more successfully as people are more open to relations but in western countries such as USA individualism plays a major role and therefore individual achievements are considered as important by employees. (Hofstede, 2001)
Another characteristic of Google’s culture is that they do not have the so called formal business meetings. Instead what they have is like a casual conversation either during lunch breaks at the café or at a tea table which really ensures each individual’s contribution to the subject matter. Also it gives them the feeling that everyone is sitting pretty much on the same level. These types of activities reduce the power distance between the management & employees, thereby creating a sense of equality which is part of Google’s culture.
Employees are sometimes given freedom to take risks in their roles to encourage them to be more creative and innovative. This resembles the self-actualisation stage in Maslow’s hierarchy of needs. This is absolutely significant in an industry which comprises of lot of high skilled and qualified professionals. They need freedom to perform individually and recognition to their achievements. Nevertheless the employees have a sense of team which makes sure that they do not compete against each other but achieve targets through more collective efforts.
The consumer oriented approach at Google makes sure that the decisions they take benefits the Google users. This thinking out of the box policy helps Google to stand out from the competition while the values of the company also being maintained at the same time.
It can be said that the culture at Google has three facets: an honourable work environment, customer oriented business approach and spiritual conduct. Through their work, Google makes sure all three fragments of its business is benefited. Employees are motivated because of the friendly atmosphere in the workplace, Google users are benefited with its cutting edge technological developments and also the organisation as a whole to attain its objectives. This leads to the symbolizing of a paradigm or a model of working environment which has worked very well during the life of Google.
EVALUATION OF GOOGLE’S RECRUITMENT AND SELECTION POLICIES
Google holds one of the strongest employer brands in the world if not the strongest. It receives more than one million job applications every year. It is absolutely challenging hence its vital to understand the screening policy it has. On the one hand some would see this as a blessing but it is indeed a dilemma to Google to sort this storm of applications and to review each and every submission to select the best fit without overseeing less competent but skilled candidates.
Google’s methodology to selection candidates is highly integrated and scientific. The technical staff at Google came up with a very non-traditional approach to hiring people. Google’s focus is not mainly on academic qualifications and past work experience as most of the other companies even though it has a gang of well-trained computer wizards and highly skilled mathematicians. What it mostly look for the personality of a particular candidate along with positive behavioural characteristics which certainly could bring value to the organisation in an open job position. The selection process contains activities that could measure leadership skills and creativity with the top emphasis on innovation.
A candidate should have an understanding of the following if he/she is facing an interview at Google.
· Culture within the organisation along with its objectives and shared values.
· Ability to think out of the box and be passionate about the job. To be able to think like owners by taking responsibility while on the job.
· Well aware of the structure within the company. (No hierarchies’ flat structure with each individual is given equal respect).
· Relationships and connections within and across offices.
· Work and life balance.
Ideal candidates should possess the following characteristics.
· Being ethical.
· Interests in outside and extra-curricular activities.
· Be a self-starter and be proactive.
· Strong analytical skills and resourcefulness.
· Solid leadership skills.
· Strong communication skills with the ability to communicate effectively and openly.
· Ability to think globally across cultures, regions and scenarios.
· Ability to be consumer focused and a solution oriented mind set.
Through setting these types of characteristics for a potential employee, Google aims at ensuring that the employee fits in with the culture of the organisation well. In addition, an employee who possesses these skills may be better at fitting in with the existing employees as it’s a very important task in a team oriented work environment. Therefore they have set standards such as do’s and don’ts of interviewing criteria as below in order to select the candidates who would fit in to their description of an ideal employee.
| Do’ s | Don’t s |
| Selecting people who are smarter and more knowledgeable than the most | Selecting people who can’t learn from mistakes and be challenged |
| Selecting people who can really add value to the organisation and its culture | Selecting people who can add value |
| Selecting people who has the ability to get the job done | Selecting people who are not proactive and only pass time by sitting on the problem |
| Selecting proactive, self-staring and enthusiastic people | Selecting people who would just do the job for the sake of doing a job |
| Selecting people who like working with others and be a motivation to the others | Selecting people who doesn’t have a team spirit and love to work alone |
- An outline of Google’s selection process.
It is said that Google has about seven rounds of interviews in its screening process. These are mostly conducted in the US office in California or in Hyderabad and Bangalore in India. The biggest weightage is on complex data structures, algorithms and other basic fundamentals related to computing. Even if the candidates manage to go through all the rounds the final word may take around 3-4 months to come.
1. Screening process starts with the recruiting team calling the interviewee over the phone.
2. Then the decision making is done by a so called business group. It has got three phases.
a. Peer interviews
b. Senior peer interviews
c. Cross region team interview
3. Then a decision on an offer is made by a so called hiring committee. This is based in Google’s California office and takes the final decision on a job offer.
- Five stages of Google’s selection Process
1. When a job opening is announced job resumes will flow in from all directions of the globe. Roughly out of 500,000 applications the HR team will review these applications and bring the figure down to 40,000 by rejecting the less competent ones.
2. The recruiting team will start calling these 40,000 applicants over the phone and out of which 1,500 candidates shall be shortlisted.
3. The 1,500 shortlisted candidates will be called in for an on-site interview out of which 1,300 shall be rejected.
4. Finally the recruiting team will be left with 200 proficient applicants whom will be directed to the hiring committee.
5. The final decision is to be made by the hiring committee, who will make the decision depending on the number of vacancies and the requirement of the job role.
So it is not an easy task that the recruiting team at Google is facing. It is extremely complex and an uphill task to attract and select the best of the best in the industry. This is why the HR team at Google work round the clock even if they do not have tall volume of hiring targets. The recruiting team really value every application and treat each and every one of them as their customers and potential employees of Google even-though some of the candidates are not competent enough for its positions.
CONCEPT OF EMPOWERMENT AND ITS RELEVANCE TO GOOGLE
Empowerment can be identified as a managerial process which is concerned with giving more autonomy to employees which allows them to be trained in making decisions and being responsible for their areas of work. The process of empowerment will result in employees being encouraged learning/ practicing the necessary skills and acquiring required knowledge with the intention of overcoming issues at the workplace and train themselves to be better leaders. (Blanchard, Carlos & Randolph, 1996) Although it may be said that empowerment assists the employee more, it can be identified to offer similar benefits to the organisation at the same time. Some of the overall benefits received by the organisation are;
- Encouraging participation/involvement in decision making leading to development of decision making skills which will result in quality decisions and better top and bottom line performance.
- Development of positive attitudes towards change and risk taking which are pre-requisites for innovation and fortifying that idea by developing an environment where employees are enabled to make decisions.
- Self-initiated growth which will develop the current skill sets of the employees and contribute to collective intellectual wealth of the organisation.
Google has been applying these principles of empowerment throughout their organisation which has immensely contributed to their success. For example the concept of initiating project teams can be considered as a form of empowerment. Through project teams they are expecting to make breakthrough innovation adopting an approach where groups collectively pursue set work-related targets and also targets for their own development. The employment of project team based approach helps employees to participate in decision making which may not otherwise be offered to them under a conventional departmental approach. This means that it’ll help in developing entrepreneurial instincts of employees which may result from the self-confidence generated by participating in decision making. On the other hand more participation from employees means that the quality of decisions taken may be higher than those taken under a limited participation model.
The principles of empowerment are closely associated with the process of decentralisation where the decision making authority is delegated to the lower levels of the organisational structure, away from the top management. Characteristics of an organisation with decentralization are more bottom-up flow of information and decisions and lesser tiers of the organisational structure. Google aims in contributing to employee empowerment through decentralisation as evidenced below.
In case of Google’s project teams, the decision making power is decentralised to the teams instead of the top management. They are expected to decide upon their targets and thereby more autonomy is provided to the staff. It is of utmost importance that autonomy and authority is provided in a project team situation as the intrusion of management in team decision making will be disastrous in terms of hindering the team focus resulting in dissatisfaction and demotivation. With that in mind they have rejected the idea of micro management by branding it as an approach which reduces creativity.
It is also apparent that Google adopts a review system which is focused on peer reviews rather than management reviews. By eliminating the need for top down management approach in review they have made their staff more responsible for their colleagues’ performance and develop their skills of identifying the rights from the wrong and reporting them in an efficient manner.
Decentralisation of decisions aimed at empowering employees is more clearly visible in the process of idea generation and screening. In Google, an employee who comes up with an idea is asked to post that idea in a suggestion box and this will be evaluated by colleagues based on its marketability and feasibility. Through this they have adopted a bottom up management approach and made employees feel more empowered as they are seen as important parts of the organisations decision process. In addition, in case of disputes relating to innovations arises, management decisions will only based on the arguments made and not on hierarchical considerations.
In addition to the above the principles of management by objectives is used by Google to empower employees in boosting creativity and innovation. By adopting the 70-20-10 principle where employees are allowed to use 20% of their time to follow their own initiatives, they have provided more freedom for employees to tap in to their creativity while ensuring more commitment from employees, in this case because they set their own objectives rather than following those set by management. The management plays more of a coaching role here as they attempt to adjust individual objectives to be more synergistic with organisational objectives and is also aimed at continuous mentoring and encouragement through reviewing and advice.
Google’s overall expectation of empowerment is the development of a motivated and loyal workforce. By offering intrinsic rewards such as more responsibility, friendly working environment and better relations with peers and superiors, they are expecting to fulfil motivators according to Herzberg (1959). In addition they are using extrinsic rewards such as offering one million dollars’ worth of Google stock for the best innovation to create an achievement oriented organisation.
In concluding, it can be said that empowerment of employees had generated fruitful returns to Google in the past. These efforts have led to the development of a highly motivated & loyal workforce which is signified by the identification of Google as the No.1 place to work for by Fortune magazine. As a result of empowerment Google has been able to develop more innovations in the past decade than any of their rivals which have resulted in both top and bottom line growth for the company. But as recent evidence from the technology market suggests, the ability of a tech company will depend on the loyalty and the retention of the workforce employed. Therefore continuation of these efforts is required in order to experience success and also to avoid threats of breakaways. In addition empowerment is a tool which has to be used with caution in order to avoid management problems which are discussed in the next section.
MANAGEMENT PROBLEMS FOR GOOGLE IN THE FUTURE DECIDING ITS ABILITY TO REMAIN COMPETITIVE
The management problems Google might face in the future can be discussed in two parts; organisational & HR perspective and competitive perspective.
- Organisational & HR Perspective
Even a company like Google which is structured for innovation with very high financial strength will be immune from management problems. It may seem that their management oversight and overconfidence may prove to be the root cause for problems in the future. The first identifiable problem arises due to management overestimation of project success. The Google management practise of approving projects based on the approval of low level employees may lead to it losing significant revenue made from its base business of search and ad-sense.
In addition to that organisational efficiency may be severely hindered by empowerment initiatives such as allowing too much freedom for employees to follow their own initiatives. The ability of employees to decide upon their participation on achieving organisational goals may prove to be negative if employees are inefficient and following an ineffective initiative. At the same time, the commitment to own initiatives may distract employees from effectively performing work in their allocated project which may play a more important part in organisational goal achievement. With a fast reacting competitive environment, any waste of time through inefficiency may result in competitors responding to the opportunity. Management interference is therefore required to ensure that employee goals are linked to the organisation’s goals & objectives.
In addition, empowerment which is aimed at encouraging innovation will lead to loss of control for the top management. Due to the high spans of control and lower number of levels in the organisational hierarchy, the top management may not be able to maintain communication with all employees of the organisation. Especially with the project team concept this will lead to creating groups which may distance themselves from the management and due to their current review system which is based on peer review, they may be successful in achieving that.
Another threat to Google is the continuous motivation of employees. Although according to Herzberg’s two factor theory (1959), the empowerment and workplace relations may act as motivators, but the extent of motivation offered by them to an individual is limited. According to Maslow (1943), employees are in continuous pursuit of unsatisfied needs and their needs differ in relation to the level of the need hierarchy they are in. Therefore companies like Google need to offer intrinsic needs such as promotions to make individuals feel satisfied. But making such offers in a team working environment will lead to the satisfaction of one employee while others may be left unsatisfied which makes them prone for competitor moves.
An even bigger threat will be from culture and path dependency where the successes enjoyed by Google may prove to be the cause for their shortfall in the future. Although continuous alignments of the organisation has been ample in addressing the environmental changes they have faced up to now, there might be instances in the future where an overall shift in the cultural paradigm may be required to avoid moving on to a strategic drift. If at this stage, the management become overconfident in past performance and become path dependent, it may prove to be disastrous. But with employees being attached to the organisation largely due to its culture, a change in the paradigm may result in breakaways from Google which has become a commonplace in the current technology companies. Therefore management may face a dilemma in taking decisions at this stage.
- Competitive Perspective
Another problem which Google might face comes from its diversion from the base business. As the industry knows Google is the most dominant search engine in the world which maintains a near total lock on the online advertising market with its ad-sense engine and Google search. In fact 95% of revenues Google made in 2008 came from this base business which is based on revenue from pay per click advertising (http://investor.google.com/earnings/2008/Q1_google_earnings.html). The introduction of new products, although may be argued to being able to guarantee the diversification of risk and revenue streams, may in fact lead to brand value erosion due to their inconsistency with the Google’s business model which is more dangerous. The image which has been maintained throughout the lifecycle of the search engine may be damaged due to unsuccessful innovations which may negatively affect customer loyalty.
The developments made by the competitors of Google and the change of customer emphasis during the past few years may prove to be another problem for Google. Search engines such as Bing who brand their product based on the accuracy of search results have continued to attack Google on the basis of their pertinence or relevance of their search results. On the other hand new competitors such as Wikia search have positioned their products above others by branding them as organic search engines which develop more and more with the inputs of people. Added to these changes to the competitive sphere Google faces the threat of change of customer lifestyle which emphasises on the accuracy and relevance of the search results. Competitors upon identification of these opportunities have now developed vertical search engines which are able to search within a particular industry for instance Expedia, which is a search engine developed for holidays and recreation. These market forces play an important part in estimating the competence of Google’s management to come up with solutions which may not be addressed by alternative products.
In concluding it can be identified that Google may face significant managerial challenges in the future due to the change of the competitive sphere and also due to the oversight of their management. Therefore incremental changes need to be implemented to address the gaps which may cause problems in the future. This way they may be able to reduce adverse effects of undertaking swift and sudden changes to the organisation and culture and make employees more acceptable to change and may be able to remain competitive under a continuously evolving environment.
CONCLUSION
The discussion above clearly demystifies the reasons behind the success enjoyed by Google up to now. Their strides towards providing an environment which spawns creativity has proved fruitful in terms of new products developed in the short life of the company. The decisions taken by management in laying down suitable recruitment and selection practices to ensure the selection of employees who could fit-in with the existing employees and taking off layers of the organisation’s hierarchy in order to empower employees has been able to generate a highly motivated and loyal workforce. But the management oversight in all actions may also lead to significant problems in the future as the market evolves and employees become increasingly demanding. Therefore proper control needs to be established which may prevent any shortfalls of the company in the future.
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