Secrets of Google’s talent retention success

Revolutionary human resource management has once again seen Google named the world’s best employer. How, asks Elizabeth Matsangou, is the tech powerhouse so good at recruiting talent and nurturing innovation?

 
Workers at a Google office opening in New York City, US. Google has one of the best reputations for recruiting and retaining talent
Workers at a Google office opening in New York City, US. Google has one of the best reputations for recruiting and retaining talent

Author: Elizabeth Matsangou

15 Jun 2015

This March, Fortune named Google, already the world’s biggest search engine, the number one employer for the sixth year in a row, making the tech company the ultimate talent magnet.

Google has achieved this remarkable feat by transforming conventions in recruitment and management. Internally, the responsible department is not known as human resources, but rather as ‘people operations’, clearly distancing the company from outdated practices. Nor is it considered a subdivision of the business, or an avoidable and sometimes annoying function that deflects resources away from profit making. At Google, people operations is seen as the core of the company, the one area that connects and facilitates all other departments.

Google’s exceptional success shows how far a company can go when it celebrates and nurtures its staff, rather than considering them replaceable tools

Mirroring how it carries out research and development for products and services, Google applies data collection and analysis to both potential and existing employees. Rather than the traditional HR format of decision-making based on assumptions, first impressions and relationship building, Google makes decisions using statistics and algorithms. “The capabilities of IT systems allow a more sophisticated and analytical approach to HR than was possible in the past”, says Mark Thompson, Head of Reward Consulting at management firm Hay Group. Thus, cold hard facts are employed in order to keep the chances of unexpected outcomes to an absolute minimum.

Valued workers
When Google went public in 2004, a letter from the firm’s founders was sent to investors, outlining the firm’s modus operandi. Co-founder Sergey Brin added the following: “Our employees, who have named themselves Googlers, are everything. Google is organised around the ability to attract and leverage the talent of exceptional technologists and businesspeople. We have been lucky to recruit many creative, principled and hard working stars. We hope to recruit many more in the future. We will reward and treat them well.”

A simple question

Only a few years ago, the main challenge of getting a job at Google wasn’t the competition, but the now-abandoned bizarre interview questions posed

Explain a database to an 8-year-old in three sentences
This challenge aimed to test candidates’ ability to boil down concepts to their constituent elements, and relate them clearly and succinctly

Why are manhole covers round?
Aspiring Googlers were asked this question to test their logical reasoning skills, as well as their ability to think flexibly about problems and solutions

How many piano tuners are there in the world?
A classic Fermi problem, this aimed to test practical estimation and the ability to work confidently with numbers on a large scale

How many times a day do a clock’s hands overlap?
This question was a more straightforward test of applied mathematical ability, but could still throw the unprepared

At Google, employees are considered the company’s most valuable asset – the backbone of the organisation. They are given freedom, a healthy work-life balance, incredible perks, and even the chance to have fun at work. There are many who maintain that such radical practices are a waste of money and time, and some may find them simply absurd. And yet, the results speak for themselves.

Given that Google is a relatively young company, its rate of exponential expansion since being founded in 1998 illustrates just how effective this fresh method of management is. Google’s exceptional success shows how far a company can go when it celebrates and nurtures its staff, rather than considering them replaceable tools. “What HR should and must focus on is understanding the relationship between the things which motivate and engage people as individuals”, says Laurence Collins, Director of HR and Workforce Analytics at Deloitte. “The environment, work, growth, reward and flexibility it offers, [are] part of the employee proposition.”

Coveted careers
Each year, two million people apply for around 5,000 vacancies at Google. With better odds of being accepted into Harvard or even of being struck by lightning, many hopeful candidates turn to unorthodox means to make themselves stand out. Lazslo Bock, Head of People Operations at Google, told Forbes in a recent interview that he often receives pleas, bribe offers and even threats from applicants. Yet, as Google only hires the finest recruits in every aspect of its business, it is far more frequently the case that those employed are headhunted. “The recruiting corps at Google might eye a target for years”, Bock explains.

During the recruitment process, Google uses an algorithm to make predictions regarding which candidates have the best chances of succeeding at the role in question. Those with a very high IQ are often chosen, although the ability to learn and absorb information is considered more important. Riddles and brainteasers are no longer used, as analysis carried out by the department has found that those who do well in such exercises are not necessarily the best candidates. Traditional interview questions have thus made a comeback in Google’s interview process. “It is often easier and gives a much bigger return on investment to quickly spot a trend and act upon it”, Collins notes. “The mere ability to see a pattern often gives enough confidence and accuracy to make better HR decisions”.

The people operations team also looks for those who will fit into the firm’s unique culture. Namely, they are looking for ‘Googleyness’ or, in plain English, intellectual humility. Leadership skills are another valuable asset for selection, although the ability to step away and relinquish power is just as important. CEO Larry Page gets the final say on any individual talented (and fortunate) enough to make it through the selection process. Not often, but every now and again, he stops someone at the final hurdle. So as to prevent shortsightedness, verdicts, such as whom to hire and fire, how performance is rated and which promotions are given, are never made unilaterally. “Each of these decisions is instead made either by a group of peers, a committee, or a dedicated, independent team”, writes Bock in his book Work Rules.

An algorithm is also used to examine top candidates who have been rejected, in order to ensure that any gems have not slipped through the net. Although this happens at a very low rate (according to HR consultant Dr John Sullivan, it is just 1.5 percent), this point illustrates the thoroughness of the process. “There are a multitude of ways in which statistical principles can be applied to the provision of people-related forecasts. Assuming that the mathematical rules of the road are applied to both the data structure and the algorithm development, then these can provide great benefit to organisations. In essence, any model requires data to be collected and a series of tests to be applied”, Collins explains.

X marks the spot

Self-driving cars
The most significant project at Google X, the search for a reliable, safe driverless car is becoming more of a race. Car manufacturers and governments are pursuing the technology independently, as the reward for a major breakthrough will be financially and reputationally significant.

Google Glass
Derided and admired in equal measure, many felt Google’s limited two-year launch of Glass was a failure. In reality, it served as vital research into how such a product can be socially integrated. Very much an ongoing project, Glass is now being redesigned by Tony Fadell, once of Apple.

Project Loon
One of Google’s social responsibility tenets is that internet access is a fundamental right. In pursuit of this dream, Project Loon aims to use high-altitude balloons to beam the internet to remote and rural areas. The name comes from the general opinion of the initial idea as crazy and unworkable.

Abundant benefits
Many of the perks bestowed upon Googlers have received individual attention for their originality, appeal and, sometimes, for their downright wackiness. Adopting a fun environment is a key stratagem for the company’s founders. To fulfil this requirement, there are arcades on ‘campus’ (as Google HQ is known internally), as well as climbing walls, a volleyball court and even two bowling lanes. There are also regular sport and gaming tournaments, giving employees a chance to bond, as well as let off steam. They may seem like gimmicks, but there is a wider philosophy at play. “All this fun might sound too frivolous to take seriously, but fun is an important part of Google, creating an opportunity for unguarded exploration and discovery”, adds Bock in his book. “Fun is an outcome of who we are, rather than the defining characteristic.”

“Job perks are an important part of some organisations’ value proposition, and the more quirky or unique the better”, says Thompson. Google certainly has quirky and unique perks down to a tee, such as providing napping pods and hammocks for workers to rest when needed, which can boost cognition levels and reduce stress. For a subsidised price, employees can also visit on-site masseurs in order to relax and minimise work-related back pain, while doctors are available throughout the day for other ailments too. Comprehensive health plans include dental and optical care, and, more unconventionally, alternative medicine and even fertility treatment. When the time comes that a Google baby is born, $500 is gifted to the new parents – just because it’s a nice thing to do.

Bicycles are placed throughout the complex for workers to pick up and use whenever they wish, and there is even a squad of electric cars available for use during lunch breaks. There is also, of course, Google’s famous free food policy; various canteens offering an array of different cuisines and healthy sustenance are available for breakfast and lunch, each and every day. Calorie content and nutritional values are provided for the dishes served, as another way in which Google tries to promote a healthy lifestyle for its employees. Free ice cream is on offer too, presumably to boost emotional rather than physical health.

Innovation, communication
Google considers enhancing collaboration to be one of the best means for facilitating great work and innovation. Managers encourage their team members to communicate and spend time together as much as possible, for bouncing ideas off one another is how the magic often happens. Within the office space, departments are grouped together by glass dividers, which enables frequent idea exchange without disturbing others, while also maintaining an open and illuminated environment.

Another concept that the people operations team has implemented to inspire the next big idea is ‘20 percent time’. This programme allows employees to work on a personal project outside of their allocated duties for up to 20 percent of their working week. Although one day a week may seem like a lot of time to divert from one’s responsibilities, it is during these hours that an individual’s passion and ingenuity is best harnessed. Illustrating this point are the products that have been created from personal projects, such as Gmail, Google Talk and Google News.

“Google is really good at providing job enrichment. Googlers are assigned several projects at a time and have ownership of their projects. They work on these projects from beginning to end, so they are involved through the whole process and are able to see how their work makes impact on the organisation”, says Dr Jonathan Booth, Professor of Organisational Behaviour and Human Resource Management at LSE.

A DJ plays music at Google's new office in Berlin
A DJ plays music at Google’s new office in Berlin

Each employee is assigned their own mentor within the company. Naturally, the mentor is chosen based on data that matches the compatibility of the two individuals. The ‘career guru’ programme allows junior staff members to discuss their career development, daily schedule and how to deal with office politics, within a confidential and friendly environment. “It is a great place to work because it is a learning organisation”, says Booth. “They really focus on learning and development.” Staff members are also given the valuable opportunity to ask senior management any work-related questions they wish during sessions called TGIF (Thank God It’s Friday), which, in true Google fashion, often take place on Thursdays. “Our weekly all-employee meetings started when ‘all’ of us amounted to just a handful of people, and continue to this day even through we’re now the size of a respectable city”, writes Bock.

Then there is the Google-O-Meter, which allows staff to vote on employee suggestions in order to gauge their popularity and whether each policy or perk has enough traction for implementation. “Googlers have a lot of voice mechanisms in place, so that their opinions and views are heard”, claims Booth. As illustrated by such policies, communication is seen as key at Google. Giving personnel a chance to speak up not only fosters a productive work environment; it can also lead to significant changes within the business.

Recruiting the best
In addition to the extensive catalogue of company benefits on offer, Google pays some of the industry’s highest average salaries in order to attract and retain the best talent. As well as this, potential and existing recruits are often attracted by Google’s core objective as a business and the company’s famous motto: ‘don’t be evil’. The philosophy behind Google’s work is to make the world a better place through technology. Given its portfolio of free products, including Google Maps, YouTube and the Google Drive service, it is easy to see why 98 percent of staff surveyed by Fortune said that they feel great pride in telling people where they work.

Projects to support the community are another pillar of the culture at Google; employees are paid for voluntary work they carry out, while philanthropic donations are encouraged. “Some of the most effective perks in terms of staff retention are not about monetary reward at all, but focus on fostering team spirit and a sense of community”, Thompson explains.

Feeling perky

Google is not the only company that offers excellent perks to employees – other firms are catching on as HR and working conditions evolve beyond recognition

On time (if you want)
At the HQ of streaming giant Netflix, employees have no fixed hours or days. They can work as few or as many hours as they like, with unlimited holidays, as long as their work is done

Family values
Facebook, Google’s main rival in the perks sphere, offers employees $4,000 in cash when they have a child, reimbursement for childcare fees, and even the chance to freeze eggs for future IVF attempts

Leave it to Jeeves
Pharmaceutical giant Johnson & Johnson provides a free concierge service for 12,000 of its employees, to take care of the simple day-to-day tasks that drain time and energy

Going to Ibiza
In a more offbeat move, recruitment firm Spencer Ogden sends those employees who meet their targets three months in a row to Ibiza, to work at their beach office for a week

The future of HR
The analytical and data-driven approach allows Google to function based on quantitative evidence and to implement policies that are as far removed from chance as possible. This scientific attitude is a new frontier for management and recruitment, and one that can boost growth and profits to an extraordinary degree. “Human capital analytics is changing the way decisions are made about human capital, and how HR engages with the business and shapes strategy. That is why the adoption of analytics in progressive HR functions is proving to be the single biggest catalyst for improved operational performance”, says Collins.

There are numerous lessons that can be learnt from Google – a whole new way of understanding human resources and how to maximise staff potential, in fact. Most firms consider the traditional bottom line as the best way to maximise growth, but it seems that Google sees things differently: the bottom line is the Googlers. Since the very beginning, Google has treated its staff with respect and care, offering benefits even when resources were scarce. When the company first started, people were allowed to bring their dogs to work, and the free meals on offer consisted of cereal and giant bowls of M&Ms. Thus, the underlying principle of valuing staff was deeply engrained in the company upon establishment – it is considered holy, never reduced and never revoked, as was firmly stated in the welcoming letter to investors: “Expect us to add benefits rather than pare them down over time.”

From the outset, Page and Brin truly understood that in order to nurture creativity and efficiency, employee privileges are paramount. “We believe it is easy to be penny wise and pound foolish with respect to benefits that can save employees considerable time and improve their health and productivity”, the letter read. The saying ‘a healthy worker is a happy worker’ is well known, but Google fully embraces the expression, paying attention to all aspects of an employee’s welfare, from their fitness, to their diet and psychological wellbeing, which ultimately invokes excellence in their work.

It is sticking to this philosophy that has made Google the best at what it does and it is also this that has enabled it to successfully branch out into so many other areas. The cutthroat business atmosphere does not exist in Google’s workspace, and, unlike many CEOs may believe, fostering this unconventional attitude does not cause a company to collapse, nor implode in a cloud of penniless nicety and good feelings. Google illustrates how the opposite is the case, continuing to thrive and attract the world’s finest talent. Generally, people spend most of their lives at work. It is, therefore, vital for it to be as pleasant as possible. Furthermore, an infinite budget or worldwide status is not necessary to create such a setting, as many cynics often claim in response to Google’s style of management. Considering employees as the most precious commodity within a business is how it can be achieved. Creating an environment in which employees want to get up and go to work can enable them to reach their full potential – to the benefit of their employers and all those around them. To some, this may seem like an unmanageable task, but it really isn’t – Google proves that it is possible.