Lower Revenues Changes Culture
Looks like this turn of events might be a sea change in corporate culture for this now maturing company. They hired young idealistic employees who worked for lower wages but loved the college dorm culture on the European plan that included free food, free toys, free laundromats, and a chance to change the world. All that is changing.
Anybody who followed my comments in this blog last year about how Google didn’t deserve to be on the “best companies to work for list” because of their low pay and slave labor mentality will be interested in this turn of events. Here is a posting from the Webguild blog.
Webguild
Google Tells CNBC Food Not Being Cut
By Reshma Kumar at August 26, 2008
Google’s cutbacks on its free food made it to the homepage of CNBC and was the fodder for a lengthy discussion amongst the CNBC anchors. Clearly, this was big news. In fact, it was such big news that Google was forced to do damage control and told CNBC’s Jim Goldman that it was not true. And the saga continues. The free food has long been a part of Google’s recruiting strategy, although, it is losing its novelty and is not sustainable in the long-term.
Many Google employees told us they would gladly give up the free food and be paid on par with employees at other Bay Area companies. “We are working for food not money“, said an employee who did not want to be identified for fear of losing their job. “They work at Google for less money…this is like indentured laborers in the farm…”, said CNBC’s Dennis Kneale.
Why the cut in food? On July 17th, Google shares were down by as much as 12% as their earnings growth reported was below analysts’ expectations. The company might not be as immune as previously suggested to the economic downturn that other companies have been experiencing. If it did not incur the food cost, it could have reduced its operational expenses.
To cut costs, the company was rumored to be testing out a new menu. The new menu is leaner and includes a quarter of a raw onion, lemon, and pita bread. “The food has been in decline since Charlie Ayers walked out the door.” said CNBC’s Jim Goldman. But apparently, this plan has been put on hold until the smoke clears. Google is in a no-win situation. It has to make up for the revenue shortfall due to the bad economy and appease shareholders not happy with having to pick up the tab for gourmet meals. However, if they cut the food costs, they will have to start paying employees market wages or they will leave. If employees walk out, it will eventually hurt the company. However, if Google starts paying market wages, it will take a big hit to its operational costs.
A Maturing Company needs Grown Up Solutions
Google does have a problem because they no longer can just keep hiring to throw more bodies at problems. They need to act like a mature company that doesn’t have an endless vertical revenue curve by hiring selectively and smarter, managing their talent wisely, building well oiled and well-functioning teams, and getting increased productivity out of their current workforce.
It is time to bring in the consultants,finally! And, they can make good use of the 55 year old, incredibility accurate personality assessment that I vendor in Silicon Valley called the Predictive Index. It is one of a handful of such tests that can be used pre-employment during the interview process to screen candidates as well as afterwards to manage and build effective teams. Up until now Google’s hiring screen was if the person was Google enough. A Je ne sais quoi approach for sure. But every hire will now have to really count for more than that. Using a simple, cost-effective, proven tool might be the wiser hiring screen.
Hey, Google, call me! I can help.
