Recently I read the inspiring book “The Google Story“. Google is seen as one of the big examples of an innovative company and a lot of people state the 20% rule as a reason for that high level of innovation. The 20% rule refers to the percentage of time that software engineers get to work on whatever interests them. Personally I think that the 20% rule is not the main reason that Google excels at innovation. What is more important to my opinion is the culture and work philosophy at the company. Let me elaborate on that…
Google 20% rule
The 20% rule stimulates the entrepreneurial level of the employees, since they can openly work on side projects. Also, people tend to be productive when they work on things they see as important or have invented, or are working on something they are passionate about. Probably a company even attracts more entrepreneurial-minded employees. When employees can only work on their side projects at home you run the risk that an idea will either fail from a lack of resources or succeeds to the point that they quit to pursue it full time. So Google gives them the freedom to spend one day a week on an idea they are passionate about without having to worry whether the idea fits into the company or even if money could be made with it.
A lot of people think that the first company to introduce the 20% rule was Google, but it has a famous predecessor. Many years before Google even existed, 3M decided to stimulate innovation by directing its engineers to spend 15% of their paid time on projects of their own choosing. Among other things, this extra time yielded the idea for Post-it Notes.
The real innovation stimulus
Sure, the 20% stimulus is a good way to get more ideas out of your employees, and therefore stimulates bottom-up innovation. However, the real bottleneck we see at a lot of companies is not generating ideas, but effectively selecting and developing the right ideas. This is the point were the culture and work philosophy of truly innovative companies like Google comes into play; as written in the book The Google Story, “People talk over lunch about the things they are playing with, it is like they are the CEO of their own little company. Once an idea matures a little bit, they tend to talk about it in a more public forum. One way of circulating word about what they are doing is through bulletin boards on Google’s internal computer network, but the company also sets aside time for peer reviews where engineers can receive feedback on their budding ideas.” Positive feedback implies other people are willing to work with you, and you have the prerequisite for a project. In the end some ideas will get funded and management makes sure that the project sees the daylight. The strength in this approach lies in the fact that employees actually work as entrepreneurs within the company; when they need marketing information, they go to a marketing specialist, when they need technical feedback, they simply get it. All this cross-functional feedback and collaboration comes without hierarchical constraints, another innovation enabler.
The innovation process of Google is nicely described in the book by the development of Google News. Initially it was the idea and little project of a guy named Krishna Bharat, at the time a 31-year-old software engineer. By late 2001 he was working with two other Googlers to build a working demo, which was released within the company to gauge reaction from others. He already new it was popular, since he got a lot of feedback from engineers, but then suddenly Eric Schmidt (the CEO) walked into his office and said he was really interested and wanted to make it happen. Then, subsequently he spoke to Larry Page and Sergey Brin (the founders of Google), and they were also very interested. Bharat’s 20-percent-time project turned into a full-time endeavor; it received the resources necessary to take the demo and built it into a real product.
At Google many ideas are generated through the 20 percent time but because it is not possible to take al the ideas and make them products, an innovation funnel is in place. The culture in which this process takes place, is well described by a remark of one of the employees: “The intrapersonal environment at Google is very energizing. When someone comes up with a new idea, the most common response is excitement and a brainstorming session. Politics and who owns what rarely enter into it.” Just check the number of successful new product launches of Google when you question whether they do a good job innovating.
The next question is of course: Can we copy this Google approach to other companies? It is possible, but it is far from easy; it is not simply a case of introducing the 20% rule. As I mentioned earlier, the culture and work philosophy are crucial. Create and foster an environment where people can easily walk into the office of other employees for feedback and advice and definitely use online tools that enable this process too. Involve top management in this process as well. Bring the innovation funnel in practice within your company. In the end, employees should be working like entrepreneurs within your company. Not everybody has the attitude to work like that, so stimulate entrepreneurship by training your employees.