Cent CHENNAL Goagle’s HR Practices A Strategic Edge? ‘Case study Reference no 408-0571 This cave was waisen by Florence Nightingale, ICAI Businass Schoo|,Chernal ‘end P Gir Al Business School Cose Development Cerra under the direction ‘of Doris Rajkumar Jo, ICr8l Business School, Chern tis intendied to be Used as the basis for class discussion rather shan to ilusrrare either affecce a ineifeeine handling of ¢ management sivation. The case wes compiled from poblished sources “© 2008,:CFAI Business School, Chena hha par: of this publicasion may Le copied stored, wansrlled -epruduced ir Slernbsedt it sry Foren or medium vihattanver ysthut she peression phe copdghs ower, CtaihelnnchKestih tihrain fei the case for learning Satexene iigaeat septa408.057-1 Google's HR Practices: A Strategic Edge? *Gongle is organized around the abitty io aftrect and leverage the talent of exceplional technologists and business people. We hava been lucky to recruit many creative, principled and hart-working stars."! = Lamy Page, Google Co-founder “Google is a great company and | am very proud fo be a part off. The petks are extraordinary and this i the most unique working environment | have ever been in. The products leas, create minds that we have contirue to amaze and inspire me = Voioe of a Google Employee Google Inc, based in Meuntain View, Calflomia specialised in Intemet search end online adverising. A of 2008, the company has abuul 15,916 ful-tine employees? Gaogla bocame popular wah its intovaive search engine. The company is alsa known for is unique culture and human resource (HR) polices and is acknowledged as an innovaror and bos! employer. I was recognised by the Businese Week magazine — 25 the ‘op employer of choice among collage shiderts, MBAS, wemen, engineers, and diverse individuals * In the year 2008, Google ranked 1° on the 70* annual "100 Best Campanies to Work Far Ist of Fortune ~ a ‘walbinovn intemational business magazine * Gaogkds innovalve HR policies and bonofis such as foo food; engineers allowed ta spend 20% of their time on ova projects; and good work environmen: made Goog|e.a motivating employs.” Bases, the company gies stock options to 88% of its employens. Despite known as a “endly-empioyer, the trend setting and innovative HR prectioes of Google wes debated. twas ‘aiguad i the ‘Best Place ta Work For culure of Google is to realy allracl and matvete the emplayees oF F itis a srategic move? Human Resource Management Practices in Knowledge-based Industry Knowledge-based Industies relatively concentrale more on their inputs oftecnology and human the knowdedge based industies, human resources have become the single mst important deteminaat of success and growth of the compary. The aggressive cloba compeifion and aocelerating technelagical change, especially in information communication and internet technologies have created an increasing ‘competion in the Imowedge-based indusbies, This nature of compelton is driving change in how supply ‘hai are beita menaged vhin and across fs. It also signals a demographic shit as the workforce is femad as knowledge-based workers. These inuwedge-based workers demand a diferent type of work ‘emvronment and leadership development programmes. There are also heightened demands fom more hnopdedgeable customers, There‘, companies face the challange of harassing zhe compotencios of ‘workers, suppliers and customers to manage In the knowledge economy — charactersed by diversity, ‘compioxity and ambiguity. ‘Peopla are tha grestest ssset for the knovéedge based inusly ond a few compares ave stated prackcing Human Resources Managentent (HRN systems hal suppor tis plidosopy, Human Resource Management pioys a vital rele in an organisation and managing HR in the knowledge-based industry i in fom 2 significant challenge for RE managers, as i involves a mmultHask responsibil. Same of the issues ! *Geting ate Google’. hitpdiwwn google 1204009107 i ‘Sulivan Jobn, “Googie Continues to hnavata in Recrufing and Cencidate Acsecement’, pth re nella nA SE7 2448 50CEOECRADEESFFOG7SO 145.05, January B 2007 ‘+100 Best Companies To WarkcFor 2008", itp money cnn.com/magatirestortnelbectcon panies 2008'smapsbos/ hi, February 4” 2008 1 Heathfield Susan, "Top 10 Ways bo Be Happy al Work", tp numanresoutces about comlodisueces sappy. wc408-0571 lhe knowledge-based industies are facing are managing people, motivation fo adopt new lectiology changas, recrufmen! and ‘raining, performance management, development and campersalion management In the competitive scenario, there is a greater demand for knowedge workers. Recruirent and retention of employees is becoming a challenge as well as & concer for the HR managers. Recrufment has become a rgjor furetion, from an iniperaive sub system in HR, pariculany in the tnowledye-based industy. Airacting new talent aio fsa top prioty for these campanies. Anather challenge for HR is o put systems into plsoe, to make the pacple a perfect fi or the Job. Skill radundancy is more in the knowkxtge-based industry, To overcome this problem, organisations give utmost priory to training and sil enhancement Programmes. Many knawiedge-hasod Industial companies are providing technical taining to the employees on a querteriy basis. These tranings are quile usetl in terms of providing ski development to Ihe employses. ‘There area number af challenges forthe comaparies which ince building a ‘conducive work enviroment hat wil bo beneficis! for tie employees, as well as the organisation? The persist problems of the nowerige-based companies ase etition, confidentefty and ayatty. CRen talented professionals enjoy high bargaining power due to Beir tnowiedge ond skis, Wifk these chaFenges, the organisalns tawe to rsh Ihe ways they manage theit employees. Unike earfer, the HR. managers have lo perform a vavisly of ‘eaponsibifies. HR has tumed oul be a stctegic function, to meet the demands of the companies and counter competion fom offers. The knowledge-based industry is faring the challenge dua fo the growing fafont asnuisiion. This aspoct creates a smoother assimilation and the: cittral hinding of the new comers into the organisation. The pressure of delivering the best of euafity sendces iv a reduved tine frame calls for ensurieg that employees raintain a work fie batance. Cre of the toughest challenges for HR in the knowledge-based industy i to seal with ths prevalent high ation levels. Though there is an adequate supply of qualified staff al enty level, there are huge gaps in the midcle and senigr level management in the industry. HR attempts to bridge the gop between the demand anc supply of professionals. They maintain consistency in perfomance ard keep the motivation levels of employees hig, As compatition is growing rapidly in the glnbal knowedge-basad industtios, avery organisation gives top priory to technology advancement programmes. HR manacers are now petfonring the role af moifvators for thet knowledge worhors to adopt new changes. Most cf the organisatfons have started maintaining an innovative and competent HR poo! and pracice HR menegement iniiatres with stung business nowesige. Companies wart to create both an appealing environment to attact and retein employees and "alte noople fe! they belong, but hoy also wart Wo increase producti. Knowledge-based industies provide benefit packages which indude enka, vision, life insurance, cafeteria and retremant plans (Exhibit . These indusires have increased the pay packages and also provide variabie pay such as incentives and bonuses lo reward and retain high performers. Many companies Fave adopted various advanced technologis in ther work tf lke human analytics? kuman capital management, carly waming sysloms and others. These technologies help to increase the efficiency level co as to meet the ever increasing needs in the compeive world, Cuisourting the human rascurce function, fexble work linings and fob sharing ate also the prevaling new trends of HRM inthe knosdexige-hased industies. * Gilamsirt Singha. ct, "internation Technctogy Offshore Outspuring in Ina: A Human Rescurees Management Perspective” hrm. cuted. a/Z0 iss ena * Homan Analysis the small business concerm providing execuliv and inchnical recruiting solic For dafonse contractors requrng nteligence, Ingust ane cuturt seluons.408-057-1 Exhibit Bonofts Programmes in Knowledge-Basod Industry Benefits Programmes hich: = Group Medical Insurance: HMO (Heath Maire ance Crpanisaton), POS (Point of Serdce) and PO refered Proder Organisation} pans Dental, ison and Le Insurance Long Ter and Short Term Cisbity Insurance ANN) Refrement Savings lan Section 125 Pre-Tax Cafolrz Plans -Prertium Cry Pen Dependent Senin Gare Reimbursement -Unreimb.rsed Mestce Transpartaion Reimbursement hid Care Fleibe Werk Schecules (On Site Corporate Heath Care Contes Cn Ste Recrestion and Finess Garters Enmployee Assistance Programs \Work Lite Balance / Enployeo Assistance Programme (Clobal Tne Assistance Voiirtary Tem tifeInurancs and ADD. Loge Senies Benet ‘aondent Insurance Welness Seminars Famiy Life Universal ite Insurance Einployee Savings Ticks. ES Beef if ns a Knowerge-based Industries provide innovative workplaces which integrate business pracesses and work Practzes. This results in neakhy and higipertomarce workplace solitons which help in improving Productivity. Employee recogniion programmes conducted by the companies enhance employes motivation, saislacion, and omployeo producivily and improve organisalonal porlormance. The knowledge-based companies plec2 a greet deal of emphasis on provicing a ‘people-onientac’ work ‘environment. The industies provide adapiablo workplaces that have the Rexibilly to aosommodate the ‘changing needs ofthe occupants and the organisation. ** Google and other related companies said, “Come to work for us, work very hard, ard weil ty fo help you ‘with your dally ecthites.“" These companies insist that they provide transportation and services in the: ‘campus tse, There is also an integration of work and non-work acivibes within the campus, Family ie and ‘work may be blaring for many professionals Google's Human Resource Management Practices — Is it Worth the Effort? With the missian ‘to organtse the word's information and mate it universally accessible and useful’, Google siarled as a search engine company co-ourded by Lary Paye and Seagay Srin on Sepiemiber 7 4998, Besides, gaining popuiarty as an innovative company In the technoleay frant, Google was 2160 renowned {or is corporate phitosophies such as Don’ ba evi and "Wark should be challenging and the challenge ‘is Elinor, “Mewamaker: Meet Googles cttue czar, hp Svemv.rews cafMeet-Googles-cultre-erar2408-1B23 3 (E179807 Atm, AprL ZT 2007 ‘Pek Place: The Bonefits Offered Ey Google and Others May Be Grand, but They're All Businass”, tp noudedge whartn-wapenn.edufaticle fn ecleit=t6S0ACF D=S5B450{2ACFTOKENS17S0B028jsessionlc-a8305e ‘5556 ab eS2ER86, March 21% 2007408-0574 should be fur’, which ilsttes its comorete culture. Google started making innovations both in the product a. oma “Google Cons ues to innovate in Recnufing and Gandddete Assessment” op. cit.408-057-1 Googe has is offices worlwide and focuses to establish bakanced representation of employees.® In addin to hiring the best talent, the dlversty of perspectives, ideas, and cultures Heads to the creation of beller products and servives at Google. This diversily of tre employees and periners serves ws the foundation for the company to steve fis diverse citstomers and stakeholders all aver the world “Diversity plays a major rlein the development ofthe o-ganisafion allover the word"* Exhibit Reasons fo Wark at Google ‘Top 10 Ressons to Work al Googie ‘1. Lend a helping hand. Wih milfons of visitors every month, Google hes became an essential part ‘cf evenday Ife ike a good fend connecting people wth the formation they need» lve great hes. 2 Lifes beautiful. Bcing a part cf something that malts and working cn products in which yous cen baliove is remarkably fling. 3. Appreciation is the best motivation, s0 welve created fun and insiting workspace youll be sad tobe apart of, incuding cnsile doctor and dentist; massage and yoga; professional ovelopmant cpportunties, on-se day care; shoreline runing tras; and panty vf stacks ta get you through the day. 4, Work and play are not mutually exclusive. Its possible to code and pass the puck atthe same time, § Welove our employees, and we want them fo know i. Google alles a varity af benefits, including a choice of medic’ progres, com panyithed ADT), tock options, maternity and pateenty eave, and mach mare. Innovation is our bloodling. Even tve best ciuology con be improvad. We see endless. "opportunly fo creale even more relevant, more useful, anc faster preducts for our users. Googl2 is ‘he lochnology Rear in oxen izing the work's nformasion. 7. Good company everywhere yau look. Googlers range fom farmer neurosurgeons, CEOs, and U.S. puzzle charnpions te aligace wrestles and onmee-Marires. No matter what ther backgrounds Gaoglers make icintsresing cube mates. 8. Uniting the worl, one user at a time. eae in every couriry and every Iarguage use or products. As such wr think, ac, and work globally - jest our lie contusion to waking the word a beer place 9, Boldly go where no one has gone before. There ze huneds of chalerges yt to suive. Your ‘reaive ideas matter here and ere vor exporing. You have the opportunity fo deveiey iovative new products tal milf people wl rd useful 10. “Thereis such athing as a ree lanch after all. n fect we have them every day: heathy, yuTimy, and made with love. “Source: “Top 10 Reasons to Work a Google™, [nipstvee google cons upeatabebinsetc prayer shout hmiabouetop!D ‘Though Google is welLkncwn a8 2 great employer, there are many pitalls n the IR practices of Google. It is ccor that much of its recogriton has come as a result of programmes and ideas thal originated beyond HR conceptsipalcies. in particular, Google i tacking in its ably to track the envihe.job performance of nev hires. Although Google's recruifhg function is inavative, there i no Ferra, wel-commuricated recruitment sitalegy. Most of the candidates at Google comment on i's slow screaning, recruling, and interview process. The number of lemporaty and contract employees in the recruiting function et Google is high. The 2 Google Contes ovals in Railing and Candidate Aces met. + *Goagh Cees Ue, pre google convpporabu vane py answa S598408-057-1 ‘unwitingness We give permanent jobs immediately to recruiters may reduce Google's billy ‘0 get experienced recnilers. Google's emphasis on atracting youngsters: might hurt ts abity to attract more ‘senior and experianced personnel. Event though Google has created a ‘eolagisle’ almosphere whore omployaes are allow (9 dress casuatly and have fun 2t work place, according to menagement experts from Wharton University, “Al! the perks provided by Google mean business."® The company’s main ein Is to achieve several goals such as attract the bast knowtedge-workers, help the employees work long hours by feeding them courmat meals on-site, handing other me-consuming personel chores ard to remain as Goog ets fora longer period af tne. Peter Gagpell, Management Professor and Director of the Center for Human Resources at Warton said, “Theso bonofis help companies recruit people wha are wiling to spend almost all of their time at work ™® Steven E. Gross, a global leader at Mercer Human Resource Consulting, US, said, “Goocle, with ts vast array of henelts, 1s Hying in dferentiate elf from other companies that went to hire people wath the same tatenis. These campanies, foo, have been expanding ‘heir employee bonafils in recent years. Ifs af about the employment brand.” Liane Homsey (Homsey), HR Ditector of Google said, "Google has busied ise around worklfe balance, particularly family Fioncly policies. Wis unusual lo Eee kids siting down inthe cafeteria "® She ack. thal ne of the challenges any success‘ul company tas to fave 's continuous crowtn and how to maintain the ‘ntaraneurial spirt while expanding he emnloyees’ sirength Homsey belaves that overcoming its growing pains is tne bagest challenge faced by HR. at Googla. She added, “So many companies have slarted of wiy imovative, erealve and vibrant, bul have then felled and become burecucrati, Is always a danger when you growe"® ‘As the company has grown so rapidly. is diffcu lo maintain is culture and keep a compensallor structure that motivates employees in future. Kevin Werbach, Assistant Professor of Leqal Studies and Bus ness Ethies al Whatton Universily said, “Googlo has done a remarkable ob in growing from a smell, prvate company 10 a 15,000-nerson organization in just few years, without Kling is startup-ike innovation culture." But, analysts are concemied that as the company grows, i is dffeul fori fo provide the same financia| and other incentives torts employees. Ket Hosarager, assistant profossor of Information and Operalions Mancgement atthe Whartan School of Business said, “Google shoud ensure that teams remain relatvely small 0 that bureauotetic decision- making doae fct slow down entrepreneurial minds, Employees should be enoouraged fo ska Indenendent iniSatives and Chey should] have the time and resources to pursue new ideas.”® in case of diversifcaticn, Govgle had louble in teoruting lelented locals in ts Soul Asian operalfons, a board member af Google said, In particular, the vanture capitalist cited a shortage of web developrient skils such as knowledge of davascript end Ajax (Asyrchronous JavaSorint and XML), the web design technology used in the latest {genaralion of websites ‘ke Google Mans and Flickr. Hidde managers also are in short supply. He added, * know frst hand that we've had a bit mare of a challenge trying to hire engineers for Google in Bangalore ‘comparad to thar parts of tha work." * SutivanJohe, “A ook inside the Googe ler: machino", Ipsec humsnrescurcesmapacine.com aularicles(6 INCU2S6 asp 7 ype-t0BCategory=1225, Febuary 2~ 2008 2 Perk Place: The Bert Ores by Googie and Others May Ba Grand, bet They're Allusiness" op ck hid, tb, 2 Vorsier Gare, “human resources tizetor profile: Llane Horne, Ht iectr, Google: Seacling fr seccess", Iga pexconn today. comvartcla2007H VUES Auman-esources director profiedane Romsey hrdie ctor. oak soaring fr success, Nocembar 25 2007 hd, ‘aan Snecma attic ist, be 0° 07 aac talc Peope tind Sos Googe Intpsldiggcomtach cewsiLack of Talented People in Inia Says Google 10408-057-1 ‘The rature of work al Google undergoes constant changes, hence fow employees are able to achiave the task ‘or whal they were inl hie (tis also opined that this may hinder the perfomance management (function. Because every hire has bean extensively screened anc Googie bellevss, “All employes have high Fetental and if someone fals, Google managers take the atitude tal theyre to blame, not the employee. ‘Anaiysts opine that Bis sitation may create problems in Google's businass processes. Many analysts felt that in future, Google should be careful in seianeng business and pleasure acts, ‘Trey further observed that although providing ‘teedom ta engineers might altract talent and encourage innovetin, but the company should not devlate trom is core business sirateay which dec affects the revenue. While Google's wilingness to launch bota versions of naw procucts at an alarming paca excites engineers, hey need to focus on seeing the larger business implications and the risk to the brand. Muct of the company’s suocass has been based an the fact thal they have been more fexole an forwant- thinking than ils competitors such 9s Microsoft and Yahoo. Managing growth with the ‘colegiate atmosphere’ ofthe company |s assent to sustain ts scenes inthe fture. Can Google sustain ts innovative work culture in the light ofits rapid business expansion — remains tobe seen. ‘Search Google for Top HR Practices”, op. "1408-057-1 ‘Annexure’ Google's Workplace Lobby Décor ~ Piano, lava lamps, and! ue prcjacinn of curert search cuties from around the ver © Hallway Décor — Bicycles and forge rubber axercse als on the for, press elipgéngs from ‘rund the world zoster on bulletin boards everwhere. Many Googles. standing around sessing arcane IP addressing issues and hom to bul abelter spam fier. © Googler Ofices — Googkas werk in high-density cusiers tenaxichiy elective of our samer sc'up, wilh hoo or for stators sharing spaces wih couches and cops. This improves informsion lew and saves ar heating its. 9 Equipment — Most Google's have high-powered Linux OS wankstaliois on thet desktops, In Google's eared days, desks were wooden doors mounled on {we saniiurses. Some of tiese ae Ulin use win be engineering group, ‘© Recreation Facilities Workout room wth weighis and rowing machine, locker eons, washers ani divers, massage oom, assoried wileo cames, foosball, baby grand piana, poo! ttt, ping ong, roller hockey tice a week in the parking lol © Google Café — Healthy hnchas and dinners forall aaft Staion ince ‘Chavie's Gi, Back Albuquerque, ‘East Meets West and Vegheads_Qutcoor seating lr sunstine dle caning 12408-057-1 Snack Rooms — Bins packet wrt varius cereals, quam beers, MEMG, tfie, horce, cashew nuts, yogtet, carts, fesh ft and cher snacks. Dozens of cilerent inks including fesh jue, soda and make-you.oan caopuccino, ‘Coolest stop om the tour tiven dimensional rotting nage of the word on permanent diploy ‘ma |aigo fet panel monitor nthe ofc ofthe engine: who created. What makes speci the togle svc that alos you ta vew polis oft represent eal me searches sing fom ‘be surface of he glbe tcwart space, color cid by language. Togcle and yo: ean see rac betes for he entire Intemat. Worth a tipi the secondo. Nearest 24 hour doughnut shon -Kispy Kreme, Mouniain View, CA ‘Source: The Google Curure, aelinew goagh conieorporatecarars na 13408-057-1 ‘Annexure i Employee Banefits at Google ‘A partial ist of Google's benefits include: 1. Flext hours for nearly every prctessiona! employee 2. Casual ess overyiay (ard this govs wellbayod bsingss casual) 3. Employees can bring thoirdogs o work, omyday 4. Onsite nhysicien end dental care 5. Heath benefits that begin as soon as an employee epois for work 5. Femassage and yoqe 7. Storeine runing tas 8. Stock options everywhere 9, Free cas and snes everywhere (express, smocthies, Red Bul heal dink, koabucha tes, you name 40._ Fron mes, ncfing beaks, ncn and dzmar (some have dasorned this en feat wih rip laafies and vr-cass chefs snchiding one tal cooked forthe Grade Dead) 44 Thee weeks! vacation during the fest year 12, Free recreation eve-ywhera, inching video games, foosba, velleybal ard pool ables 13, Valet paring for employees 4, Onsis car wash and detaling 16, Matemiy zo paren leave (pus new mores ce dacs ave eto expense upto USS5O0 ‘or take-cut reais ding the fat eur wecks that ty ae home with therm baby) 16, Employee e‘ea! onus program 47. Near ste childeare cen: 48. Bechup chidcare foc pareris whan ther regularly scheduled chid caro fale woul 18. Free chulle service to several San Francisco ard East and South Bay locations (Sar Francisco 45 miles away from the main campus} 20, Fuel eliciency vei incentive program (USS5,000 assistace if yor buy hybrid) 21. Onste dry clearing, pus a con-fee laundry rom 22. Friday 1GiF atemplayee gatherng where the founders frequenty speak 23. A4OTK rwestment proctamme 2A. Ao sackang vf ck days” policy 25, An onsie cytn to work of al of tie sro li, "Teak side he Google Wie machine” etyetewit umamresolreesmanerine. com aiarticlea3 CODE asp ypenBO8Getegary=t223, Februmy 22003 14408-057-1 Annexure Nine Unknown Things about Google 4. Scooters are out. bes ae in — Googlers now use bizyles as tei primery more of ranspotafon corporate 2. Mavie nights — Googles van rent an ee thea for She day. Thats exetly whet Google's done for ‘movies Fike “Lord ofthe Rings,” “Trenstorners” and oer bokiusters. AS an extra benef, employees Getto beng 3 quest 3. Goo-geo Googiers — Google moms enjoy upto 18 wecks of paid metemity teave: das get seven ‘areks. Another peri ree Google baby ‘oneses ” 4. Google's own Facebook — Google's inranct, provides all the usual comporate information, We benetss, Intemial neveleners, and 2 naw employes handbook. t's used mos! often, however, for searching aut other Goag ess; the dscory provides phoins ofthe company's 15,916 employees. 8. Google air — On as Mountain Viow campus, tro company has recenly installed a spedial nvironmentaly Hendly ci-ferng system designed to fuch aut toxins and parcalses. Hf youl stuck indoors coding a nigh, you might as well recthe clean air.408-057-1 6. Google's Fools! ~- tts a compary trafifion to Gesign elaborate pranks to play on its users and potential employees every April ist Past gags include a job listing for engineering positions on tha moon ‘and 2 fictitous produc. the brain-boosting energy drink Google Guta {ftavors included "Beta Carroty" and “Game Grape’) But he oles backed when, on Rol = 2004, Congo benched Gal and ay readers hough wae anethee Apel Foots hoe 7. Employee clubs — ne of the many ways Google recruis and retaing talent is through club offerings. It unds the Black Googler Network, Google Wornen Eniginaers and the GLET - Gay, Lesbian, Bisovl and Trensgencor Googles. 8 Google's grand entrances — Out, Googke’s meg social network, iso big ht Brel Caincidertaly, Erez fs the sourse of the elegent hom wond wed to bud the Googkepler’s enormous. setae. The etree to fe cmpeay’s New York headquarters no less impressive ts gota huge akLego loga but by a certified Lego designer along wth 2 Gfoot mode! cf the Empre State Buking buitby Google engineers. A. Free fond, Googie style — Googlers are a we'-fed hunch: The company even has a ele - worsers can never be more than 101 foal avay stom food. Hence the elaborete See chack slaions and restaurants scaforec throughout the Goog aplex. 16408-057-1 ‘Soaree: 5 lings you ditt know abowd Google™, ‘itatimcny.cun.comicaleries/2008 tunes gallery ZectCo_Google 8 fatunefinex in, January 22° 20s. 7