00:00:01
welcome to the show I'm Kade Massey professor the practice here at the Wharton School and I'm joined by Laszlo
00:00:07
Bock he's the head of people operations at Google and importantly he's the
00:00:11
author of a brand new book a book called work rules we're here to talk with Laszlo about his new book welcome well
00:00:17
okay it is fantastic to be here thank you it's fantastic to have you here I've
00:00:21
chatted with you in various places around the u.s. anyway but I've never chatted with you here on camera and we
00:00:28
want to hear about your thoughts on your new book so the first question in my mind is what does it say about Google
00:00:34
they allowed you to write this book I mean most people I think would want to keep these secrets of how you guys
00:00:39
operate to themselves and yet they allowed you to write this book what does it say about the firm
00:00:44
yeah well it's it's funny we kind of had this epiphany and I was thinking about
00:00:48
this and I realized work actually sucks for a lot of people a lot of the time and and at Google it's actually pretty
00:00:55
good most days we still have bad days I have bad days but it's not miserable all
00:00:59
the time before a lot of people work system means to an end and we spend more time working than we do anything else
00:01:04
more time than we do sleeping more time than we do with our loved ones and it didn't feel right that that we would be
00:01:11
having something and figuring out how to do things and kind of other firms wouldn't be able to learn from a benefit
00:01:16
from what we do so we decided we're gonna open-source some of this stuff and
00:01:20
share it with the world in the hopes that actually work gets better everywhere not just at Google why does
00:01:24
Google care about that improving the state of the world in terms of work you guys are about organizing information
00:01:30
why do you care about other people enjoying themselves at work well for two reasons and this is gonna sound a little
00:01:35
trite because every company's got a mission statement but people at Google really attached to it they really feel
00:01:41
it they they believe in this idea of making information free and sharing things and transparency and so reason
00:01:46
one is we want to we want to do that we want to try that the second is because what we found is rightly or wrongly you
00:01:52
know when Google makes news people pay attention and so even if we're saying
00:01:56
things that aren't rocket science we did this thing called Project oxygen which
00:01:59
actually had rocket science in it was fascinating about what makes managers work well but it it got a lot of
00:02:05
coverage as soon as the New York Times picked it up and people paid attention and we got all these stories about
00:02:09
people treating their employees better and we thought you know what yes we got organized world's information
00:02:14
that's important but we should be doing the right thing and everything we do and
00:02:18
this is a way to share some of that well can you tell us some of the main principles that you espouse in the book
00:02:22
if you were to say what the message is of this book what would that be I think I think there's a few one is
00:02:27
that it's important to have meaning in your work and there's fantastic work
00:02:30
actually about one of your colleagues Adam grant around the importance of mission and connecting your work to
00:02:34
something meaningful and what he's seen in his research you get a 30% to sometimes 400 percent improvement in
00:02:40
productivity by just making work meaningful ami Rosinski professor at Yale University also a friend similar
00:02:46
work she looked at people who were housekeepers who were janitors in a hospital and she found a third of folks
00:02:51
even in that kind of job found meaning in their work and ways to make it matter so number one is that the
00:02:56
second is taking power away from managers managers have all these incentives to control and manage but as
00:03:02
employees we want to be free and when we feel free we do our best work so I write
00:03:07
a lot about how to take power away from managers at Google for example managers can't hire they can't choose who to
00:03:12
promote it's all done by committee the third big thing is actually applying some data some science to making sure
00:03:17
that the decisions we make when it comes to people are right because our intuition is is wrong most of the time
00:03:23
you actually can't trust your gut in our computer scientists tell us you've got
00:03:26
11 million bits of information coming at you at any given time if you think about
00:03:30
not just what you see what you hear you actually you feel that your clothing on you right you're tasting the inside of
00:03:36
your mouth all your all the time your brain filters us out and can only process about 40 of those 11 million
00:03:41
bits so we make bad decisions without realizing it so the rest of the book is about how do you apply science to
00:03:47
actually make better decisions and it is we'll take what we learned and and the
00:03:52
beautiful thing is it works for just about any company well this is one question a lot of people would would
00:03:56
would say this is something that can happen in Silicon Valley or especially at Google they have all these resources
00:04:01
is it really applicable to my company whether it's small guy or an industrial
00:04:05
guy is it really applicable outside of your special setting yeah so so far it really seems to be and what's amazing is
00:04:12
we at Google have applied a lot of intellectual horsepower and analytics to prove this stuff works but you know like
00:04:18
a lot of good ideas a lot of companies develop this stuff independently and have just been doing it so in the
00:04:22
Northeast you've got this grocery chain called Wegmans and they treat people
00:04:26
well they open their books to people they give people incredible freedom there's this great story that jaktip
00:04:31
eaters their CEO told me dad a baker who got a call and said you know I need a wedding cake this afternoon can you
00:04:36
please help me so God bakes a cake and he he picks it up and goes to deliver it he shuts down
00:04:42
the bakery for four or six hours to get this cake to a customer and when he comes back to the store he's not
00:04:48
vilified for losing revenue they say he's a hero because he did the right thing and then
00:04:53
outside the US there's this really cool company I stumbled across doing the research called Brand X retail our
00:04:59
textile manufacturer they and you think about textile manufacturing in a developing country
00:05:05
you don't think great working conditions but they have a largely female workforce
00:05:08
they teach them entrepreneur entrepreneurship because they actually want them to actually go and do other
00:05:12
things afterwards they give them money to buy wells and build wells and their home villages so people have clean water
00:05:17
and so they're viewed as heroes and they do all these things and they're more
00:05:21
profitable they're viewed as a great company they have higher employee retention and higher quality work
00:05:25
product as a result so all these things around what you do for people lots of companies as different-sized I've done
00:05:30
it and what they generally find is you actually end up with better economics rather than worse selasa
00:05:35
if that's the case and it can it's more profitable and it works for grocers and
00:05:40
Buffalo and textile manufacturers in India why don't more people do it why don't more organizations do it that's a
00:05:47
great question I think I think the reason more organizations don't do this stuff is it's not always intuitive and
00:05:55
it actually cuts against all your incentives as a manager as a leader the reason you get promoted is because
00:06:01
you've done good work you've hit your goals you've made good decisions so
00:06:04
you're in this job and of course you immediately want to make good decisions
00:06:08
hit your goals move things forward and you forget that when you're an employee
00:06:13
you want your manager helping and you know giving you advice and then kind of getting you up getting out of your way
00:06:18
as a manager your whole mindset shifts so if your whole mindset shifts and once you start doing is saying like well I
00:06:25
got to make sure everyone delivers I got a micromanage I got a watch thing so it's not intuitive as a manager to
00:06:30
actually give people more freedom and back off and that's one of the things we've discovered that you have to limit
00:06:34
the power of managers and then people actually perform way way better so institutionally you solve that as a
00:06:40
organization by robbing your managers of power and this is I think one of the most interesting one of those surprising
00:06:46
aspects of the book I mean we always need the story of transparency and illustrations of it we've heard about
00:06:51
empowerment and we've seen some illustrations of it you guys seem to take the empowerment thing a step
00:06:56
further by explicitly philosophically robbing managers of power you mentioned the term committee is that
00:07:02
really an improvement on giving manager I mean some sense you're not empowering
00:07:05
that manager yeah so we we actually make a lot of decisions by committee so hiring for example you interview at
00:07:11
Google you'll meet your potential manager your potential peers potential subordinates everyone writes up feedback
00:07:16
feedback goes to a hiring committee and none of the people you met will be on that committee and then that committee
00:07:20
makes a recommendation which goes to a more senior one and eventually to Larry Page or CEO and these committees are
00:07:27
really important because they've just got one job they their job is to keep the quality bar incredibly high and the
00:07:33
reason you go to the separate group to review this stuff is because they don't
00:07:36
have any other incentives other than keeping quality high if I'm a manager I
00:07:40
want to fill my job and I want somebody's gonna do what what they're told and by the way if I've got a
00:07:43
customer who's got a nephew and the nephew needs a job maybe I want to give that kid a job so that maybe I'll get a
00:07:49
sale or some kind of deal later with this customer those are all bad incentives the committee is all about
00:07:55
quality and that's our only incentive the other thing is once you remove sort
00:07:59
of the individual you know oh I interviewed this person I like them you know I like to sale they like to sale or
00:08:04
I went to the same school you know we must be similar once you remove all that you get less
00:08:08
biased decisions and what we find is we actually do better in terms of hiring in
00:08:12
diversity because you remove all this bias that is introduced in the interview process okay another another thing I
00:08:20
hear that I've heard in other places but again you guys seem to take it further
00:08:23
than most is transparency and this is a major theme in the book and I'm curious
00:08:29
do you think there are necessary conditions before you can start being that transparent does transparency
00:08:34
follow other conditions or does it lead that's an interesting question we so
00:08:40
Google had we had an advantage our founders Larry Page and Sergey Brin believed from the beginning it was
00:08:45
important to be transparent so it's in our DNA so they started having employee
00:08:49
All Hands called TGIF's you know sort of once the coming out 50 people if you
00:08:53
listen to surrogate and we've just always done it we've always shared information it's kind of
00:08:58
part of who we are in what we do if you don't have that kind of culture I wouldn't start where we start right like
00:09:04
what we do today is every quarter Eric Schmidt our chairman after the board meeting he comes two dozen he comes and
00:09:10
doesn't all hands for all our employees and he tells you exactly what happened
00:09:14
at the board meeting he shares all the materials that's a big step as a first
00:09:17
step so what I would do instead is build trust and I'd start sharing things you
00:09:22
would normally wouldn't share so for example it might be as simple as the minutes from the meeting of the
00:09:26
management team might be as simple as having people come and be no takers who are junior people who can kind of soak
00:09:30
up how decisions are made it might be a product roadmap you don't normally change share with folks or it could be
00:09:36
you know some financials you don't normally share but give people a little and allow that trust to build and it'll
00:09:41
feel less scary and you get to a point where people share a lot more and the benefit of that is not just that people
00:09:48
feel trusted which is a positive because then they'll work harder for you the
00:09:52
other benefit is they'll know what's going on and they'll make better
00:09:54
decisions and they'll create better product um something I've seen with you
00:10:00
guys over the years and you talk about some of the book is how much research you do internally and how do you how do
00:10:09
you inculcate this sense of always improving and building on what you've done Minh you guys take now two three
00:10:18
four generations of research to continue to improve it you don't treat these
00:10:21
things as a one-off project you don't have an outside consultant come in and
00:10:24
do the same one time you're it's almost academic in the way it builds on
00:10:28
previous work how do you pull that off well actually part of it is you we lean on academics so Prasad Sethi who leads
00:10:34
our analytics and compensation team he often says if you're a company if you're
00:10:39
a non-profit if you're the government you should be spending more time with academics than you do with consultants
00:10:43
because academics also have this long-term perspective you know they're they're trying to make tenure right and
00:10:48
so they want to show results over a long time they're interested in topic area
00:10:52
you can actually get some great results so they actually those kind of partnerships actually encourage you to
00:10:57
have a longer term perspective but the other piece is I often talk with the team at Google about there's a
00:11:02
difference between running a program and doing a stunt a stunt is we're just one time gonna try
00:11:08
this and see how it goes and on to the next thing but you never actually know for sure what the benefit was of that
00:11:15
program because there's always lots of other things so you need to repeat things you need to run experiments they
00:11:20
need to watch how they unfold over time to make sure that what you did actually works mm-hmm great so we're about out of
00:11:27
time I'm curious we've talked about some parts of your book the book is rich it's
00:11:31
got tons of information tons of detail tons of interesting ideas is there anything in particular we've not talked
00:11:36
about you want to make sure you share you know I think that that's part of the
00:11:41
book that kind of I had the most fun writing was this chapter on nudges and it's called nudge a lot and nudges are
00:11:47
these things to academics Fowler and Sunstein kind of came up with this idea and they talked about a nudge is is a
00:11:54
it's a it's a nudge it's not a shove it's not a push it's not forcing someone
00:11:58
the idea is what can you change in the environment around somebody to help them make a better decision without removing
00:12:04
their options of making choices and it's a very cool area of research and I'm
00:12:10
glad you're asking because we haven't talked about it a lot but the two of the
00:12:13
coolest things in there one is about actually weight loss so we did this experiment where we we put all the candy
00:12:20
in our New York office and opaque containers so we have micro kitchens everywhere free food healthy snacks
00:12:24
unhealthy we put the candy and opaque containers and by making a little harder to see and a little harder to get to
00:12:30
people shifted to healthier snacks and over a three-week period people consume 7 million fewer calories almost a
00:12:37
thousand pounds worth of calories fewer consumed and then you think about your home pantry and you open the pantry and
00:12:43
what have you got right in front you've got like the sugary cereals and the snack food and the candy bars and all
00:12:47
the healthy stuff is hard to get to like it's immediately applicable to home and
00:12:51
you know you can actually make yourself healthier there's another piece about
00:12:54
the importance of savings and in a way it's kind of the dullest but also the
00:13:00
most important idea in the book another researcher looked at how much wealth people accumulate over a lifetime and he
00:13:06
found that he looked at the lowest decile people who had $35,000 of social security reportable income over 25 year
00:13:12
period which means all their other income or transfer payments right social security medicare medical food stamps
00:13:19
things like that and within that cohort of people $35,000 is all they earned some of them were
00:13:26
able to save $150,000 over a 25 year period and the reason was if you set a baseline savings rate and just keep
00:13:33
saving that rate you accumulate a lot of money and most of us don't most of us
00:13:37
live paycheck to paycheck or it's hard to save but because of the power of compounding if you and your 20 save 100
00:13:43
bucks a month you can retire with 50 or 100 150 thousand dollars more than if you didn't and it's super boring because
00:13:49
it's like it's just talking about retirement it's the future and there's
00:13:52
this math and compounding but honestly it has the potential to have the biggest impact on somebody reading the book
00:13:58
wonderful great we thank you for being here good luck with the book it's great
00:14:03
work we've been with Laszlo Bock new book work rules hope you pick it up Thank You Leslie pleasure thank you so
00:14:08
much Kate you