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1-Page Summary of How Google Works

No Plan Is the Best Plan

Larry Page and Sergey Brin founded Google in 1998 with the principles of building products that are excellent, accessible services, and focus on the user. They also hire talented engineers who have free rein to do what they want without being encumbered by processes or procedures. If they’re not sure about something, they just go talk to their engineers.

When Microsoft realized that Google was a threat, they wanted to discuss business strategy. A board member asked for a plan, which caused problems because the head of products had already tried and failed with his team on a traditional gate-based approach. When Page found out about it he said “Have your teams ever delivered better products than what’s in the plan?” The answer was no so Page threw away the old plan. Rosenberg and Schmidt revised their presentation, but instead of presenting a traditional business strategy they reinforced their message that “the way to challenge Microsoft is by creating great products.”

Google is a large company that employs thousands of people. Its success reflects its founders’ ability to rethink the way work is done and management principles are applied in order to create an innovative working environment.

“The Internet Century”

Information is free and accessible via the Internet. Mobile and digital technologies connect people and networks across borders and around the world. Cloud computing makes the storage of computing power and information inexpensive, lowering barriers to entry for almost every industry. Pre-Internet companies that created businesses built on proprietary information and scarcity of resources are ripe for disruption because they’re now vulnerable to competition from new entrants who can use technology to get a toehold in their markets without having to spend huge amounts of money on infrastructure or other assets.

To stay relevant, companies must offer superior products. People have so much access to information and such a variety of choices that having a large marketing budget doesn’t guarantee continued success. The costs of risky experimentation are significantly lower due to the availability of 3D printing—a technology for prototyping cheaply. Successfully bringing products to market requires speed, which is why companies with pre-Internet product development structures won’t be able to keep up in today’s fast-paced world.

“Smart Creatives”

In the old days, companies were run by people who had deep and specialized expertise. Today’s companies are run by people with more general knowledge and skills. These new workers have to be smart creatives in order to thrive. Smart creatives work in fast-paced environments where they’re not afraid of risk or change because they have unlimited access to information and computing power. They speak up when they disagree with something, get bored easily, and move around a lot for better opportunities or more interesting projects. Smart creatives are self-directed collaborators who work hard but need meaning from their jobs if it’s going to be satisfying for them. Their success depends on company culture, which is why Google looks for smart creatives as opposed to specialists.

Larry Page was unhappy with the ads on Google.com and decided to take action by posting his complaint on a bulletin board. Jeff Dean, one of the engineers, saw it and worked over the weekend to develop an alternative solution that would improve ad relevance rather than clicks or revenue. This spontaneous effort greatly improved AdWords, which is now used by many other companies as well.