Posted June 18, 2009 7:41 am by with 5 comments

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google-logo1Google is often a victim of its own success. While there is little cause to go out and throw a pity party for them, it is an interesting study to see what a Google does to manage the pains that come with getting so big so fast. The Wall Street Journal examines the continued problem of Google bleeding top talent as employees leave for start-ups, often taking with them the innovation that Google needs to expand beyond its King of Search status. It’s a good problem to have considering the times but one that is getting real attention from the C-level folks in the company (in between trips to Washington, DC, of course).

The gist of the problem is

The Mountain View, Calif., company famously lets its engineers spend one day a week on projects that aren’t part of their jobs. But Google has lacked a formal process for senior executives to review those efforts, and some ideas have languished. Others have slipped away when employees left the company.

“We were concerned that some of the biggest ideas were getting squashed,” said Google Chief Executive Eric Schmidt in an interview.

While many might start to wonder if innovative thinking is slowing down at Google that’s not the case. It’s the process that handles this innovation that has suffered under the weight of going from a freewheeling, cool start-up itself to the 20,000 employee corporate behemoth it is now. There is a price to being the most recognized brand in the world after all.

So what is happening to slow this talent drain down?

Google has recently started internal “innovation reviews,” formal meetings where executives present product ideas bubbling up through their divisions to Mr. Schmidt, Google founders Larry Page and Sergey Brin, and other top executives.

The meetings are designed to “force management to focus” on promising ideas at an early stage, Mr. Schmidt said.

Whenever you see the word ‘force’ used to describe a technique it looks like some of the fun may be leaving Google along with its talent. Once again, is this kind of thing avoidable when a company becomes the size, scope and influence of Google? Few have enough experience to even know this especially in a company that has gone from 0 to world leader in such a short amount of time.

Recent new product introductions like Wave and the ability to integrate Google platforms with Outlook (which is another story in itself considering the finger pointing from Microsoft around initial troubles with the offering) have gone through a new process to help the innovative products / features actually see the light of day.

Here’s where it is actually tough to be Google as well. We have often noted how disappointed people can get with double-digit growth numbers that Google has turned out. The Journal’s article does it again

Google needs new products to jumpstart its growth. While it remains a juggernaut with one-third of all U.S. advertising dollars spent online, its year-over-year revenue growth has slowed from 56% in 2007 to 31% in 2008 and was just 6% in the first quarter of this year.

In a day and age company performance is flat year over year most are thrilled, Google gets bit because it isn’t doing what it did several years ago in a ‘healthy’ economy and a rapidly expanding new industry. This kind of unreasonable scrutiny may be influencing how Google handles their internal innovation process. Pressure, whether it is valid or not, can make people do silly things.

Google is trying to make sure this exodus is at least slowed.

Google has taken cracks in the past at the retention problem. In March, it repriced millions of employee stock options whose value had been wiped out as Google’s share price has fallen over the past two years. The company has also begun testing a mathematical formula to try to predict which employees are most likely to leave, based on factors like employee reviews.

What Google experiences, however, is still very different than most of the rest of the world. Just one look into the thought process of a former employee will tell the story

Sean Knapp, a former Google engineer, left the company in 2007 and started Ooyala Inc., a start-up that distributes and manages advertising around online video.

Mr. Knapp said Google managers offered him the chance to start the project within the company, but he declined. He worried he wouldn’t feel the same pressure to succeed. “If you’re really aggressive, you want that sink or swim environment,” he said.

Most companies have to figure out how to motivate employees just to do the jobs their job description outlines. Having a company full of alpha dog, intellectual talent can present unique situations. Google CEO Eric Schmidt wants to foster that young company feel as the company tries to make it possible to be “part of a start-up within Google.”

Good luck. Here’s to innovation!

  • Google innovates many things in advance than others do.This made them to be leader in the industry.Google will keep rocking in future as well.

    Comment by Tam Krish – Director,SEO Empire.(

  • this is just the start of Google’s success, I guess… 🙂

    Jehzeel Laurente’s last blog post..Just Guess and Win A Prize!

  • foo

    Welcome to going through exactly what Microsoft went through in roughly 1998-2000.

    Oh, and “innovation review” sounds like something out of a Dilbert comic 🙂

  • Steve Billmer

    Google needs new products to jumpstart its growth?

    No, Google needs PRODUCTS to jumpstart its growth. Google has been picking the low-hanging fruit of the demise of the advertising industry. Coincidentally, advertising has fallen off a cliff, but the conversion rate has helped Google prosper.

    However, Google appears to be an ADVERTISING/spyware (doubleclick) company more than anything else, and I look forward to an increase innovative products that actually do something from the minimal “web based desktop replacements”.

    This is more than “innovation review”. It’s innovation, period.

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