IntegrativeThinkingandPerformanceManagementatGoogle

Eric McErlain, June 7, 2016

Integrative Thinking and Performance Management at Google

In Chapter 7 of Work Rules!, Laszlo Bock dives into minute detail concerning how Google

worked to optimize the company’s performance management system: “Performance

management as practiced by most organizations has become a rule-based bureaucratic process,

existing as an end in itself rather than actually shaping performance. Employees hate it.

Managers hate it. Even HR Departments hate it,” wrote Bock.

Bock continued, “Even at Google, our system was far from perfect … The two primary

complaints were that it took too much time, and the process wasn’t transparent enough, which

raised concerns about fairness. So what were we doing right that made our employees twice as

happy with the system as employees elsewhere -- but still not happy enough? And what were

we doing wrong?”

In this paper, I’ll benchmark Bock’s efforts to evolve Google’s performance management

rankings against the factors laid out in The Opposable Mind. Did Bock’s demonstrate integrative

thinking? Was it a success? And what learnings could I apply to my own workplace?

Early in Work Rules!, Bock provides the insight into the experiences that informed his stance

about reforming the workplace. “But by 2003, I was frustrated. Frustrated because even the

best-designed business plans fell apart when people didn't believe in them. Frustrated because

leaders always spoke of putting people first, and then treated them like replaceable gears,”

Bock wrote. “You spend more time working than doing anything else in life. It's not right that

the experience of work, even at some of the best employers, should be so de-motivating and

dehumanizing.” It was then that Bock took a job at General Electric, where he would be



exposed to their vaunted 20-70-10 performance management system, as well as Six Sigma, a

data-driven process to improve quality and efficiency. With these tools in hand, Bock was ready

to go to work at Google.

According to Martin, integrative thinkers share six things in common in the stance they take

toward complicated business challenges. Here’s how Bock measured up.

Conflicting models don't represent reality: Instead of approaching performance management

as an either/or question, Bock was willing to look for something better, even when 55% of

Googlers, 25% higher than the industry average, said they were satisfied with the performance

management system.

Existing models are to be leveraged not feared: While Google’s current system wasn’t perfect,

Bock wasn’t willing to surrender and eliminate evaluations completely. Instead, he used his

current system as a base and plowed ahead with a determination to fine tune it.

Better models can exist, just not created yet: Bock’s early career experiences left him with a

passion to develop something better to revolutionize the workplace and treat employees more

humanely. Wrote Bock: “Low point on my first project: I asked my manager for career advice

and he told me, "You guys are all like arrows in a quiver. Every one of you is the same."

They are capable of bringing the better model from abstraction to reality: Despite his early

career frustration, Bock is fundamentally optimistic, and buoyed by Google’s employee-centric

culture, believes he has what it takes to make something new and better. We see this



fundamentally optimistic outlook when he describes transitioning his career to human

resources. "My colleagues in consulting thought I was committing professional suicide, but I'd

done my homework ... I reasoned that my training and background would make me stand out in

the HR talent pool and help me come up with novel situations (emphasis mine)."

Comfortable wading into complexity in order to create a new model: As Bock leads us deeper

into the process, the complexity seems to rachet out of control as one set of Googlers totalling

over 1,000 employees decides to further subdivide their performance categories. But instead of

yielding to the urge to simplify, Bock lets the experiment play out.

Give themselves time to create a new, better model: Reading the chapter on performance

evaluation was mentally taxing. There seemed to be no option that Bock would exhaust in

order to find a small win. He clearly was committed to giving his team the time and space to

create something new and better.

Perhaps the ultimate tribute to Bock’s integrative thinking skills is the fact that he used them to

adopt a fundamentally dis-integrative solution: severing the connection between performance

evaluation and people development.

So how did it all come out? Wrote Bock, “Across the board, the new process was viewed as no

worse than the old. While it seems like a Pyrrhic victory, it was actually a huge relief for me.

Some Googlers had worried that the loss of precision conveyed by a 41-point rating scale would

mean that our ratings would have become less useful and meaningful. Instead, Googlers’ survey



responses revealed what we suspected all along: The forty-one point created only the illusion of

precision.”

In Google’s culture of experimentation, one that’s designed to let the company “fail faster”, the

attempt should be looked upon as a “thoughtful failure” it has learned to tolerate as the price

of fostering innovation. In this case, the effort yielded empirical evidence that confirmed one of

Google’s theories about their performance management system. There is a better model, and I

have little doubt Bock and his team at Google have been hard at work diving back into the

complexity in pursuit of that better model.

Developing an integrative solution takes a considerable investment of time, energy and focus. I

discovered that first hand when I helped modify our organization’s performance review system

based on feedback from an employee survey. While compiling the results only took a few

weeks, identifying action items and implementing them took a full year.

After reviewing the feedback, it was clear there was some dissatisfaction. The process of

establishing performance objectives didn’t begin until well into the 4th quarter of the year, and

because the approval process took so long, final objectives were not approved by management

until the end of the first quarter of the new year. Employees told us they wanted the process

reformed so they could enter a new year with their objectives already established. With that in

mind, we moved back the start of that process to the middle of the fourth quarter and got a

commitment from management to speed approvals so it could be completed by the end of the

year.



As for the performance assessments themselves, the employees in the focus groups told us that

they believed the process needed more transparency. Similar to Google, we had used a five

point system (1-5) in half-point increments (1.5-4.5) to grade performance. Assessments were

delivered twice per year, at the end of the second quarter and then again at year-end. While

the mid-year assessment does include scoring, the focus of that evaluation has traditionally

been for coaching, letting the employee know whether management believes they are “on-

track” to achieving objectives.

In response, we provided more insight to staff as to how the scoring system worked as well as

sharing benchmarking data with managers so they could get a better idea of how scores were

awarded across the organization. During our bi-annual training week, we offered tutorials on

how to conduct performance assessments, while also enabling additional fine tuning in the

scoring system by allowing scores to be awarded in quarter-point increments.

So how did we do? The real benchmarks came when the latest employee survey results were

tabulated. 48% of employees said they were satisfied with the performance review program, an

increase of 6% over 2013. When we asked the question of whether or not the program set

worthwhile performance objectives, 52% agreed, an 8% drop from the previous survey. In

terms of identifying areas that required improvement, 53% agreed the process did a good job, a

4% increase. In response to the question of whether or not the process of summarized job

performance accurately, 64% agreed, an increase of 9%. When we asked if the program helped

further their careers, 35% said yes, an increase of 2% over 2013.



So what’s the upshot? It’s time to start the process again, or at least remind my teammates of

the work we did in 2014 and what our fellow employees are telling us about the changes we

made. While we should be happy with most of the feedback, there’s a better model out there,

and we can find it, if we only create the time and space to make it happen.

Endnotes:

Laszlo Bock, Work Rules! Insights from Google That Will Change How You Live and Lead , 2015,

Hachette Book Group, Inc.

Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative

Thinking, 2007, Harvard Business School Press

http://www.theglobeandmail.com/report-on-business/when-two-thoughts-beat-one/

article18149773/

http://www.wsj.com/articles/book-review-work-rules-by-laszlo-bock-1428361249

http://www.forbes.com/sites/danpontefract/2015/04/27/work-rules-rules-at-google/

#337a5e1e19bc

http://www.danpontefract.com/why-id-work-with-googles-laszlo-bock-one-day/

http://www.forbes.com/sites/kathryndill/2015/03/25/its-ok-if-they-copy-us-googles-hr-chief-

on-the-upside-of-giving-away-staffing-secrets/#7db08b2f2a60

https://www.glassdoor.com/Overview/Working-at-Google-EI_IE9079.11,17.htm

https://blogs.msdn.microsoft.com/jw_on_tech/2012/03/13/why-i-left-google/

https://www.quora.com/What-is-the-worst-part-about-working-at-Google

http://techcrunch.com/2009/01/18/why-google-employees-quit/

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