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“It’s been said that every institution is nothing but the extended shadow of one person.54 In IBM’s case, that was Thomas J. Watson, Sr.”
To do all this, you have to be crazy enough to think you will succeed, but sane enough to make it happen.
Every company needs a “Don’t be evil,” a cultural lodestar that shines over all management layers, product plans, and office politics.
But we can tell you with 100 percent certainty that if you have one, it is wrong.
This is why a venture capitalist will always follow the maxim of investing in the team, not the plan. Since the plan is wrong, the people have to be right. Successful teams spot the flaws in their plan and adjust.
In fact, it’s fine to have a plan, but understand that it will change as you progress and discover new things about the products and market.
So although your plan might change, it needs to be based on a foundational set of principles that are grounded in how things work today and that guide your plan as it shape-shifts its way to success. The plan is fluid, the foundation stable.
“Google Strategy: Past, Present, and Future.” We delivered it to the board in October 2002
Bet on technical insights that help solve a big problem in a novel way, optimize for scale, not for revenue, and let great products grow the market for everyone.
most important component: What is the technical insight upon which those new features, products, or platforms will be built?
Giving the customer what he wants is less important than giving him what he doesn’t yet know he wants.
Start by asking what will be true in five years and work backward.
Examine carefully the things you can assert will change quickly, especially factors of production where technology is exponentially driving down cost curves, or platforms that could emerge.
Spend the vast majority of your time thinking about product and platform.
Growth matters most. All big successes in the Internet Century will embody large platforms that get better and stronger as they grow.
Iteration is the most important part of the strategy. It needs to be very, very fast and always based on learning.
“What is the single most important thing you do at work?”
For a manager, the right answer to the question “What is the single most important thing you do at work?” is hiring.
Leaders (and management book authors) often say they hire people smarter than themselves, but in practice this rarely happens in a hierarchical hiring process.
In a peer-based hiring process, the emphasis is on people, not organization. The smart creatives matter more than the role; the company matters more than the manager.
Think about your employees. Which of them can you honestly say are smarter than you? Who among them would you not want to face across a chessboard, on Jeopardy!, or in a crossword-puzzle duel? The adage is to always hire people who are smarter than you. How well do you follow it?
But hire them not for the knowledge they possess, but for the things they don’t yet know.
“learning goals”99—goals that’ll drive you to take risks without worrying so much about how, for example, a dumb question or a wrong answer will make you look. You won’t care because you’re a learning animal, and in the long run you’ll learn more and scale greater heights.
Favoring specialization over intelligence is exactly wrong, especially in high tech.
“What big trend did you miss about the Internet in 1996? What did you get right, and what did you get wrong?”
Create opportunities for every employee to be constantly learning new things—even skills and experiences that aren’t directly beneficial to the company—and then expect them to use them.
We institutionalized the LAX test by making “Googleyness” one of four standard sections—along with general cognitive ability, role-related knowledge, and leadership experience—on our interview feedback form. This includes ambition and drive, team orientation, service orientation, listening & communication skills, bias to action, effectiveness, interpersonal skills, creativity, and integrity.
You should first do your own research on who the interviewee is and why they are important. Look at their résumé, do a Google search, find out what they worked on and do a search on that too.
You want to learn if the candidate was the hammer or the egg, someone who caused a change or went along with it. Your objective is to find the limits of his capabilities, not have a polite conversation, but the interview shouldn’t be an overly stressful experience. The best interviews feel like intellectual discussions between friends (“What books are you reading right now?”). Questions should be large and complex, with a range of answers (to draw out the person’s thought process) that the interviewer can push back on (to see how the candidate stakes out and defends a position). It’s a good
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“What surprised you about…?”
“How did you pay for college?”
“If I were to look at the web history section of your browser, what would I learn about you that isn’t on your résumé?”
“When you are in a crisis, or need to make an important decision, how do you do it?”
But what’s most important in the Internet Century is product excellence, so it follows that big rewards should be given to the people who are closest to great products and innovations.
News flash: When you hire great people, some of them may come to realize that there is a world beyond yours. This isn’t a bad thing, in fact it’s an inevitable by-product of a healthy, innovative team. Still, fight like hell to keep them. The best way to retain smart creatives is to not let them get too comfortable, to always come up with ways to make their jobs interesting.
We discuss it in our staff meetings and one-on-ones: Who on your team is a good candidate for rotation? Where do they want to go? Do you think that is the best thing for them?
focus your retention efforts on the stars, the leaders, and the innovators (not necessarily the same people), and do whatever it takes to keep them around.
Because people seldom leave over compensation, the first step to keeping them is to listen. They want to be heard, to be relevant and valued.
Then, if they want to continue the conversation, have a plan for how they can develop their career while staying. This demonstrates your commitment to their success,
The best smart creatives often want to leave so they can go start something on their own. Don’t discourage this, but do ask them for their elevator pitch.
One last note: There are some people who actually enjoy firing. Beware of them. Firing instills a culture of fear that will inevitably fail, and “I’ll just fire them” is an excuse for not investing the time to execute the hiring process well.
The right industry is paramount, because while you will likely switch companies several times in your career, it is much harder to switch industries. Think of the industry as the place you surf (in Northern California the most rad waves are at Mavericks, dude) and the company as the wave you catch.
Tom Lehrer line—“Life is like a sewer: What you get out of it depends on what you put into it”115—and a promise that if they put real effort into the exercises, he will help them.
Think about your ideal job, not today but five years from now. Where do you want to be? What do you want to do? How much do you want to make? Write down the job description: If you saw this job on a website, what would the posting look like? Now fast forward four or five years and assume you are in that job. What does your five-years-from-now résumé look like? What’s the path you took from now to then to get to your best place?
No matter your business, learn how the right data, crunched the right way, will help you make better decisions.
When making financial decisions, for example, don’t worry about the ABCs of the MBAs’ and CPAs’ EBITDAs, ADRs, and RPMs; focus on what matters, which is usually cash and revenue. (A frequent Eric aphorism during financial discussions: “Revenue solves all known problems.”)
The right decision is the best decision, not the lowest common denominator decision upon which everyone agrees. And it’s not always your solution. As Coach Wooden once said, “Be interested in finding the best way, not in having your own
There is a mistake technical and scientific people make. We think that if we have made a clever and thoughtful argument, based on data and smart analysis, then people will change their minds. This isn’t true. If you want to change people’s behavior, you need to touch their hearts, not just win the argument. We call this the Oprah Winfrey rule.
When ending a debate and making a decision that doesn’t have 100 percent support, remember these three words: “You’re both right.” To emotionally commit to a decision with which they don’t agree, people have to know that their opinion was not only heard, but valued. “You’re both right” accomplishes this.
Then, after reassuring the argument’s losers and articulating what needs to be done, the decision-maker must ensure that everyone who was involved does one of two things: disagree but commit, or escalate publicly.
