Contributor: Liz Stiverson
Work and Life is a two-hour radio program hosted by Stew Friedman, director of the Wharton Work/Life Integration Project, on Sirius XM’s Channel 111, Business Radio Powered by The Wharton School. Every Tuesday from 7 to 9 PM EST, Stew speaks with everyday people and the world’s leading experts about creating harmony among work, home, community and the private self (mind, body and spirit).
On Work and Life, Stew Friedman spoke with Prasad Setty, Vice President of People Analytics and Compensation at Google – Fortune Magazine’s number-one company to work for – about how Google uses rigorous data to make hiring, promotion, and development decisions that keep Googlers the happiest they can be – and working for Google for as long as possible.
The following are edited excerpts from their conversation.
Stew Friedman: What exactly is “people analytics,” as a field?
Prasad Setty:
Broadly, our mandate is to make sure that all the people decisions we make at Google are based on good data and information. An organization our size makes thousands of people decisions every year – who we should hire, who we should promote, how we should pay people. In a lot of cases, it seems like those decisions are based on emotions, instinct, or perhaps politics; we want to try and make them more rigorous. At Google we are all about innovation and we believe that innovation comes from the smart, talented Googlers we hire. Therefore, we think that people decisions are no less important than any other business or product decisions we make so we want to base those decisions on data.
SF: Do your colleagues on the executive team at Google agree with this view?
PS: They actually do. Right from the beginning, that’s been something I’ve been really happy about. Even before I joined Google, there has always been a perception that we need the best talent, and we need to keep them happy.
SF: What have been some of the really important things you’ve learned from your scientific inquiry in people analytics research that you’ve converted into practice at Google?
PS: I’ll give you one example that’s worked out really well for us. It’s an effort we internally call Project Oxygen, and it’s about people management. We felt there was a perception, especially among our software engineers, who pride themselves on having very creative, independent careers, that people managers are bureaucrats who stand in your way. Very early on, before I joined, Google ran an experiment where they removed all the middle layers of management, so all 500 engineers working at the time reported to the head of Engineering. It was a short-lived experiment because the head of Engineering got very busy. But the sentiment about bureaucracy persisted.
A few years later, our team started to look at the question of whether people managers matter at an organization like Google. Using a lot of data, including surveys of people who worked for managers about their managers’ performance, we found there were differences. There were some managers who were able to make their teams more productive and reduce attrition, and other managers who weren’t. We wanted to know whether this was a matter of random chance, or whether these apparently great managers were actually doing something consistent, specific, and thoughtful. So we ran a double-blind study to see if we could figure out what differentiated effective managers from ineffective ones. From that study, we were able to codify eight behaviors we saw great managers doing and poor managers not doing – those are the Oxygen attributes.
The attributes fall into two broad categories. Half of them are about whether the manager helps the team drive business results – Do they set goals? Do they share information? Do they make sure their employees get the resources required to complete tasks? The other half is about how well they treat each person as an individual – Do they act as a good coach? Do they help with career development? My team developed an upward feedback survey which is being sent to every Googler twice a year to enable them to review their managers on these eight attributes, and each manager then receives a consolidated report on what they do well and where they can improve. The next step is what made this really interesting for our organization. People Development, Google’s internal training and development group, took these behaviors and built custom programs for managers to improve on each attribute.
SF: So the feedback is connected to behavioral interventions and training that can help?
PS: That’s exactly right. We track whether managers sign up for the classes, and six months later, we’re able to see if the classes have had any impact. We’re constantly getting feedback, trying to make our development programs better, and trying to help our managers improve, and we’re really happy with the results. On average, Google managers’ scores have increased 5-10 points over the last several years. But more importantly, the scores of the bottom ten percent of managers have gone up an average of 20 points.
SF: What is it about Google that it is fundamentally different from other companies with respect to how work and life fit together for your people?
PS: We want people who are amazingly capable and talented, and we want to keep them happy – we want them to be healthy and have long, sustainable careers here. In our annual employee surveys, we regularly measure this notion of well-being. How satisfied are Googlers, and what are the things that might affect their overall well-being? How can we improve those things? We find there are many dimensions to well-being – employees’ ability to handle stress and their workloads, flexibility in arrangements around where and when they work – and we look at all of those areas. We also look at how people managers support the efforts of employees, and that feedback is very important to managers. When we started making reports available to individual managers, we gave them the option to share their scores with their teams. Many managers came back to us and said, “What I’m missing is a button that will allow me to share it with everyone at Google.”
SF: That’s certainly consistent with Google’s philosophy of sharing information, right?
PS: That’s exactly right – we try to live that internally as well. Transparency is one of our core cultural values, and generally, we think that if we give people freedom, they will amaze us. That means we need to give them lots of information so they can make good decisions.
SF: What’s on the horizon for you as you think about the next big project for people analytics at Google? What are you working on that could be applied to other organizations?
PS: We are working on a 100-year survey we call gDNA – Google DNA – which will track several thousand Googlers over the course of their entire careers to understand how careers evolve and what role work plays. We hope it will help us uncover deeper connections between what work and life means. Broadly, we want to track people’s life happiness and what work contributes to that life happiness as they progress in their careers.
SF: Do you have any theories as to what will be the key drivers of life happiness?
PS: At this point, we are looking at certain personality traits for some of the nature-versus-nurture differentiations. Then, we want to look at how careers evolve – some people have very high career trajectories – is that something that’s conducive to more life happiness? Other people slow down at some stage in their life and have other priorities that make work secondary – does that kind of optimization result in greater overall life happiness when they look back decades later? I hope that as an organization, we are able to adapt and make Google conducive for employees to best lead their lives. That’s the commitment we’d like to make to Googlers – we want Google to be the kind of place where you come in, have impact that shapes the world and hopefully live longer because you worked here. We think that would be the best employee value proposition we could ever offer.
Prasad Setty describes himself as first and foremost a numbers guy; he started his career in management consulting and discovered his interest in connecting data and people topics at Capital One before joining Google in 2007. Google’s vanguard approaches to people management are profiled often, including studies of Project Oxygen and a recent blog by Laszlo Block, Google’s SVP of People Operations, on the implications of gDNA.
Join Work and Life on Tuesday, June 3 at 7:00 PM EDT on Sirius XM Channel 111 for conversations with Shannon Schuyler, on the payoff for socially responsible action, and with Liza Mundy, of whom we ask these questions – Who are the breadwinners? Who are the caregivers? And why does it matter? Visit Work and Life for our full schedule of future guests.
About the Author
Liz Stiverson received her MBA from The Wharton School in 2014.
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