TIP Strategies is a privately held Austin-based economic development consulting firm committed to providing quality solutions for public and private‑sector clients.
This blog is dedicated to exploring new data and trends in economic development.
By: Irene Chapple
(CNN) — The global talent war is heating up as baby boomers begin their mass exodus from the workforce. But a new report reveals employers are not prepared for the new generation of emotionally intelligent, ethnically diverse workers.
“After the Baby Boomers, The Next Generation of Leadership” reveals what the next two decades of the global workforce will look like, as those born after the war make way for the so-called X and Y generations.
Organizations that fail to prepare for the evolution of the workforce “do so at their peril,” the report, from executive recruitment firm Odgers Berndtson and Cass Business School, found.
The report drew on surveys of 100 senior executives across 19 countries, and 24 nationalities, between 2010 and 2012.
Cliff Oswick,deputy dean of Cass Business School, said the “rock star” approach to chief executive leadership which has been prevalent in recent years will no longer work.
Oswick, speaking during the report’s launch in London Wednesday, pointed to different types of corporate structures, such as citizen-centric and servant leadership, as models for the future.
According to the report, the rise of women into positions of power will create a “feminization” of leadership which will be reflected in the increasing importance of emotional intelligence, people skills and flexibility.
The importance of the BRIC nations and other emerging markets will also ensure more culturally diverse workers are employed around the world.
This, the report found, will mean knowledge of other languages will become more important. However, English is cementing itself as the language of business, with executives regarding fluency for non-native speakers more important than native speakers speaking a foreign language.
According to Oswick, the demands of the X and Y generations are aligned to the skill-set of female leadership styles. However he noted high-flying corporate women of today’s world are not necessarily showing more feminine attributes, such as emotional intelligence and aversion to risk.
Oswick said the shift in leadership styles that generations X and Y will bring was yet to flow through to workplaces. Ingrained discrimination against woman in remained an issue, he added.
The generational change mean executives seek a new crop of leaders who can inspire others “across geographic and age barriers,” and who were comfortable with uncertainty as well as being curious, educated, well read and traveled.
The report noted: “This list makes sense: emotional intelligence and flexibility are essential skills in an environment where generations, cultures and gender are all in flux.”
However, the new generation is also focused on work and life balance, rather than just corporate progression. This attitude can be seen particularly with working women, who want to be intellectually stimulated and valued as part of a team, the report found. This desire was more prevalent than pushing through a perceived glass ceiling.
One of the interviewees noted: “In general we are nurturing individuals, while the baby boomers are more generalists.”
The biggest single challenge will be recruitment, as the world’s population ages and companies seek specialists in fields such as technology.
However, the report reveals only 41% of the respondents believe organizations are ready for the changes the influx of X and Y generation leaders will bring to the workforce.
One respondent said the company was “actively trying to get in front of the change and lead.” However, “I find it difficult to say that we are ready. I doubt many organizations are.”
The report suggests organizations should ease the transition by allowing senior executives to use the last years of their career to mentor up-and-coming leaders. Respondents were split on whether a move away from full executive responsibilities should mean a reduction in pay.
Organizations should also adapt to the different mind-sets of the new generations, who looks for a work and life balance and the opportunity to work smarter rather than harder. Flattening the organizational structure and ensuring companies are culturally aware will be vital, the report said.
By: Hannah Seligson
Via: The New York Times
JASMINE GAO, who is 19, just wasn’t the classroom type. So instead of languishing in college, she dropped out after her freshman year.
Ms. Gao decided that she didn’t want to continue studying at Baruch College, part of the City University of New York. At first she considered transferring to Carnegie Mellon in Pittsburgh, but she changed her mind when she saw that her tuition bill would be around $44,000 a year, with only a small amount of financial aid available. “I didn’t want to come out of college with $200,000 in debt and have to spend 10 years paying it off,” she said.
Yet she still sought a way to nurture her interest in technology. A year later, Ms. Gao holds the title of data strategist at Bitly, the URL-shortening service based in New York.
How did she catapult from dropping out of college to landing a plum job? She became an apprentice to Hilary Mason, chief data scientist at Bitly, through a new two-year program called Enstitute. It teaches skills in fields like information technology, computer programming and app building via on-the-job experience. Enstitute seeks to challenge the conventional wisdom that top professional jobs always require a bachelor’s degree — at least for a small group of the young, digital elite.
“Our long-term vision is that this becomes an acceptable alternative to college,” says Kane Sarhan, one of Enstitute’s founders. “Our big recruitment effort is at high schools and universities. We are targeting people who are not interested in going to school, school is not the right fit for them, or they can’t afford school.”
The Enstitute concept taps into a larger cultural conversation about the value of college — a debate that has heated up in the last few years. In important ways, the value is indisputable. The wage gap between college graduates and those with just a high school degree is vast: in 2010, median earnings for those with a bachelor’s degree were more than 50 percent higher than for those with only a high school diploma, according to the Department of Education.
But college is expensive, and becoming more so — between 2000 and 2011, tuition rose 42 percent, according to the National Center for Education Statistics — and students fear being saddled by debt in a bleak job market. (Students from the class of 2011 who took out loans graduated with an average debt of $26,000.) And some employers complain that many colleges don’t teach the kinds of technical skills they want in entry-level hires.
Peter Thiel, the billionaire investor, upped the ante to this argument when he started the Thiel Fellowship, which pays a no-strings-attached grant of $100,000 for young people not to attend college and to pursue their entrepreneurial dreams instead.
Enstitute doesn’t offer anything like $100,000 to its apprentices. Still, it is aimed at intelligent, ambitious and entrepreneurial types — people like Ms. Gao, who participated in the Technovation Challenge, a nine-week program and competition for high school girls to design a mobile app prototype at Google in New York.
“If I had known at 19 what Jasmine knows, I would be ruling the world,” says Ms. Mason, who is 34.
The concept is not a perfect model by any stretch. For one thing, a college degree is still the assumed prerequisite of most any professional job. But more people seem interested in testing alternatives.
“We need educational research and development for a new time,” says Tony Wagner, an innovation education fellow at the Technology and Entrepreneurship Center at Harvard and the author of “Creating Innovators.”
“I have no idea whether Enstitute is going to be successful,” he adds. The only way to find out, he says, would be to follow the apprentices over time after the program and compare them with their college-educated peers. “Yes, you get exposed to a lot of great things by going to a liberal arts school,” Mr. Wagner says, “but you have to look at the cost-benefit analysis.”
MR. SARHAN and his co-founder, Shaila Ittycheria, met when they worked at LocalResponse, a social media company in New York. They selected this year’s first class of fellows — 11 in all — from a national pool of 500 applicants ranging in age from 18 to 24.
Ms. Ittycheria, 31, and Mr. Sarhan, 26, call the program “learning by doing.” Students train under a master, in the way that many trade professions have operated for centuries. “It’s a level of experience that an intern never sees,” Ms. Ittycheria says.
For participating companies, the program offers cheap, talented labor for a much longer period than a typical internship. But the fellows are betting that their minimal wages will turn into full-time jobs once they complete the program — perhaps even at the very company where they apprenticed.
Nine of the fellows have attended at least one year of college, and three are college graduates. Most say they do not plan to return to school. But what will the apprentices miss if they forgo the four-year period of intellectual exploration and cultural knowledge that college is meant to provide? Defenders of higher education argue that college students gain important knowledge as well as critical-thinking skills that are crucial to a meaningful life and career.
The Enstitute’s founders contend that their program does teach critical thinking, but in different ways. “They are not debating Chaucer; they are debating product features,” says Mr. Sarhan, who graduated from Pace University. “But it’s the same idea of how do I write down and communicate an argument.”
Enstitute does offer a semiformal curriculum, requiring eight hours a week on topics like finance, branding, computer programming and graphic design, as well as English, sociology, and history, the content of which comes largely from online courses. The fellows also receive writing assignments every six weeks; outside academics and experts edit and review the work for writing style and grammar. Many fellows choose a less technical track for their course work and study subjects like Japanese culture or the poetry of Keats.
Based on their living arrangements, it would be easy to mistake the fellows for traditional college students. They share a large loft space at 11 Stone Street, near the southern tip of Manhattan. There are two to four beds to a room and three shared bathrooms, and the fellows share cleaning duties.
Most socializing takes place in a sparsely decorated common space, and around a large banquet-type table. Dinners are usually prepared and eaten communally. Twice a week, established entrepreneurs come to dinner, give an informal talk and take questions.
Perhaps the only giveaway that this isn’t a college dorm is that by Friday night, the apprentices are often too tired to go out. Full-time work is exhausting.
Many of the fellows say they work upward of 40 hours a week. There is no overtime; the compensation package is a stipend, usually around $800 a month, with housing and food fully subsidized by Enstitute — a benefit being extended only to the program’s first class. Starting this September, the new batch of fellows will have to pay $1,500 in annual tuition, and their room and board will not be covered. Stipends, however, will be around $1,600 a month — and they will be paid overtime. The entrepreneurs cite various reasons for agreeing to take on an apprentice. “It’s an awesome value at a nominal cost,” says Ben Lerer, 31, a co-founder of the Thrillist Media Group, a digital media site geared toward men; its apprentice is Ben Darr, 20. “We would hire Ben full time today,” says Mr. Lerer, who treats Mr. Darr to twice-weekly boxing sessions. (Enstitute strongly discourages employers from hiring the apprentice before the program is over.)
Having an apprentice for a two years has other advantages for a business. “It takes three to four months before you trust an intern and before they are up to speed, and then the internship is over,” Mr. Lerer says.
Ms. Mason, at Bitly, agreed to participate in the program because she has an intellectual interest in new models of education. “I moved from academia into start-ups, and I wish I had had a way to learn what I needed to be useful at a company,” says Ms. Mason, a former computer science professor at Johnson & Wales University in Providence, R.I.
Beyond the fellows’ work, companies are eager to tap into the mind-set of 18- to 24-year-olds, a coveted demographic group.
Kwame Henderson, 23, an apprentice at the mobile software company Tracks, is its head of quality assurance and manages a product plan, which involves ensuring that the app works properly for users across all their devices.
“Kwame put together a whole presentation of how people in college would use Tracks, says the company’s founder, Vic Singh, 36. “He makes copy sound more casual, and that helps move the needle with the younger audience.”
(Unlike most of the fellows, Mr. Henderson is a college graduate; he received a bachelor’s degree in marketing, with a minor in information technology, from Seton Hall in 2011. He enrolled in Enstitute as an alternative to attending an M.B.A. program, which would have cost $50,000 a year.)
THE apprenticeships in this class focus on tech start-ups. For the next class, Enstitute will offer apprenticeships in digital advertising and nonprofit areas, placing fellows at places like The New Republic, The Huffington Post, BuzzFeed and the nonprofit Charity: Water.
Enstitute says it has raised around $300,000 in donations in the last year, and it plans to expand to a couple of more cities by fall 2014. Its founders want the nonprofit Enstitute to become a brand name like that of a top-flight university. But instead of getting a paper diploma, the fellows will graduate with a portfolio of skills they’ve acquired, business development deals they’ve closed, marketing materials they’ve created and products they’ve built, in addition to 5 to 10 recommendations.
When the first Enstitute graduates enter the job market, some hiring managers might view the program skeptically, says John Sullivan, a management professor at San Francisco State University who serves as a hiring consultant for technology companies. Many hiring managers still place a high premium on a college degree and will not even consider an applicant without one, he says.
But many companies are having trouble filling positions requiring precisely the kind of knowledge that the apprentices are learning. Mr. Henderson plans to leave Tracks knowing how to ensure that a mobile app is ready for public release. Mr. Darr learned how to wireframe, a way of making prototypes for screen-based products. Ms. Gao, who wants to run her own company, is learning Python, a coding language. Samman Chaudhary, 24, who wants to work at a business incubator, will have experience in evaluating business plans; she recently judged a venture capital investment competition at the Stern School of Business of New York University.
“It’s a race for top talent, and you would be crazy to ignore talent that is demonstrating execution and learning through alternative channels,” says Jason Madhosingh, an Enstitute board member and director of innovation and digital partnerships at American Express, a role in which he makes hiring decisions.
For many companies in technology hubs like Silicon Valley, San Francisco and New York, though, “this is exactly the kind of hire they are looking for,” Mr. Sullivan says. “Code speaks louder than words there.”
By Kathleen Baireuther
TIP recently completed a Talent Report Card for the Maury County (TN) Chamber and Economic Alliance. The project consisted of (1) developing a set of indicators to track talent as it relates to economic vitality, (2) identifying benchmark counties, and (3) comparing the benchmark counties to Maury County across these metrics. The Talent Indicators Snapshot (below) highlights some of the key findings from this analysis.
Our methodology around indicator identification, benchmark selection, and qualitative analysis is summarized here. Our approach to the Talent Report Card reflects our holistic perspective on talent development, retention, and attraction and illustrates how a range of data sets can be analyzed and displayed to tell a compelling story about a community.
The Maury County Alliance initiated this project to gain a better understanding of the factors and trends shaping the population of young professionals in the community. As it is used in this context, talent refers to the population between the ages of 20-39 who have attained a Bachelor’s degree or higher.
This group is not necessarily more “talented” than other demographic cohorts, but it is important to a region’s economic vitality for a number of reasons. From the ages of 20-39, individuals pursue education, begin and develop a career, and, in many cases, start a family and anchor themselves in a community. A higher degree of mobility is also associated with this phase in life. This increased mobility can expose some communities to the risk of losing local talent to other, often larger, cities.
The share of residents ages 20-39 is also critical to maintaining a sustainable economy because it replenishes the workforce as older workers retire. Communities that have trouble retaining and/or attracting young, educated individuals may be at an economic disadvantage over the next twenty years as the Baby Boomers retire and a robust labor pool continues to shape business location and expansion decisions.
Economic vitality measures are also included in this analysis because the overall health of the economy strongly influences how attractive a community is to talent, as well as the breadth and depth of the professional opportunities available in the area. Quality of place describes how attractive a community appears from outside the community. Like economic vitality, quality of place also drives relocation decisions among young, educated professionals and should be considered in tandem with economic and demographic characteristics.
For our Maury County work, a set of nine benchmark counties were identified based on total population, share of population ages 20-39, the presence of higher education, and geography (proximity to a metropolitan or micropolitan area). An in-depth analysis of how the counties compared to one another across each of the talent indicators was also provided to the client as part of the Talent Report Card. The resulting document highlighted Maury County’s relative strengths and opportunities for improvement.
Qualitative Benchmarking: Assets & Amenities
The presence of certain amenities is also relevant in a discussion of what draws people to a community. To capture the “softer side” of talent development, attraction, and retention, TIP also performed a thorough qualitative benchmarking analysis around key amenities and assets in each benchmark county.
Findings from this research were catalogued in an Excel spreadsheet that itemizes over 200 assets and amenities related to talent retention and attraction. The results are summarized in Fig. 15 (below) and presented in an interactive online map, here.
Each asset on the map is labeled (mouse over) and includes a hyperlink to additional information. The interactive map denotes assets by category (identified by the icons above) for all ten counties included in the benchmarking exercise. Different categories of assets can be viewed by selecting them in the bottom right corner of the map. This format allows for a comprehensive scan of a wide range of characteristics that communities leverage to market themselves to young professionals and prospective employers. The geographic clustering of assets is also evident in this format.
This scan illustrates that Maury County possesses many of the key ingredients often associated with successful talent retention and attraction efforts. Enhancing and promoting these assets and amenities will further support local efforts around engaging young talent in the community.
Project Update: Woodward, Inc. HQ and Manufacturing Facility to Relocate to Downtown River District in Fort Collins, CO
by Caroline Alexander
After completing a strategic plan for the City of Fort Collins in 2012, TIP has continued to support the City’s Economic Health Office, providing research and analyses to help them refine their program and investment strategy. As such, we have been able support them in their continued efforts to put theory into practice.
Recently, the Fort Collins City Council voted to approve a $23.5 million business assistance package for Woodward, Inc. to develop a 101-acre property to house its corporate headquarters and a manufacturing facility. The company plans to invest $220 million in new buildings, relocate 600 jobs to the new facility, and create 400 new jobs. The economic impact analysis that TIP and Impact DataSource prepared estimated that the project will likely generate a net benefit for the local taxing districts of over $36 million in the first 10 years.
The significance of the project, however, moves far beyond its economic and fiscal impact: it has the potential to transform the city’s under-developed River District and spur additional investment in the area. The headquarters will anchor the southeastern edge of the River District with a major employer and will provide 29 acres of improved open space along the Poudre River. Demand for services such as hospitality and retail will grow to support the headquarters of a $2 billion global company and will generate a great deal of activity in the District. Recreational users will also be drawn to the expanded access to the river, generating even more social, retail, and dining activity. As a result of this catalytic project, the streets between the Woodward Campus and historic downtown will likely see a surge of interest and investment.
Kudos to the City of Fort Collins, the Economic Health Office, and the Downtown Development Authority for their work in making this project happen.
By: Marcus Wohlsen
In a few months, another graduating class of college students will stumble out into an unforgiving job market weighed down by staggering debt. But one school in one of the hottest hiring markets in the country is flipping the script on student loans: until you get a job, you don’t pay.
App Academy in San Francisco (and now New York) offers a 9-week, 90-hours-a-week boot camp to turn programming novices into code jockeys. They just graduated their second class last Friday. Of the fifteen students to graduate from the first class, fourteen have found jobs, co-founder Kush Patel says. Typical annual salary, he says: more than $80,000.
“We don’t want to charge up front because we feel pretty strongly about tying the payment to the outcome,” says Patel. “If they can’t find a job, we’ve screwed up somehow.”
In tech hubs like Silicon Valley, he’s not wrong. Qualified programmers in cities like San Francisco and New York fend off recruiters as multiple companies bid for their services. New recruits signing up for App Academy promise to pay 15 percent of what they earn during their first year on the job, payable over the first six months after they start working. For the school, the math isn’t too shabby if they succeed at placing their students. If 15 students get jobs at $80,000 salaries, that works out to a $180,000 commission.
App Academy’s model reverses the traditional incentive structure for higher education. If you’re paying out of pocket for schooling, then the onus is on you to get the most out of the experience that you can. In other words, you want to get your money’s worth. At App Academy, Patel says, the instructors are motivated to give you the highest quality learning experience they can, since the school doesn’t get paid if you don’t learn.
In the current job market, at least, the only worry for App Academy is if students decide to squander the investment the school has made in them. For example, after all the intensive instruction they decide they don’t want to be programmers.
“The risk to us is students might want to go back to school or start their own business— or simply change their minds,” Patel says. “We’re actually very confident students can get jobs.”
To keep students on track, App Academy requires them to sign a good-faith agreement that they will pursue jobs as developers when they graduate. They also have to pony up a $3,000 refundable deposit to hold their spots and show they’re committed. (Patel says they’re sometimes flexible on the deposit, depending on a student’s circumstances.)
Admission to the school is competitive. Prospective students are asked to read an intro to coding and then take a timed coding test, as well as a live coding test during an admissions interview. The intent isn’t to show previous coding knowledge, but rather programmer potential. The admission rate is “sub-10 percent,” Patel says.
Though most students so far have been college graduates, they’re coming into the program with a range of life experience. The average age is 28, and the classes include many mid-career switchers as well as recent grads. Most of the first class was unemployed when they came in and, Patel says, couldn’t have afforded a big up-front tuition payment: They were “people who didn’t have enough capital to invest in themselves.” Finding a job for most after the class was over, Patel says, took an average of four weeks.
As a former hedge fund analyst, 25-year-old Patel would appear to know something about investing. His co-founder, 26-year-old Ned Ruggeri, knows something about code: before starting App Academy, he was a developer on Google’s search index team.
“It’s just a skill that doesn’t come easy to everyone and is just so valuable,” Patel says. For App Academy, the value of that skill—and the instructors’ talent at passing it on—is what will keep the lights on not just for graduates but the school itself. “We will always have significant skin in the game,” Patel says. “For every student.”
By: James B. Stewart
Via: The New York Times
After Yahoo’s chief executive, Marissa Mayer, ordered employees working from home to show up at the office for work, there was speculation that she was emulating Google, her previous employer.
Yahoo employees should be so lucky.
Whatever else might be said about Yahoo’s workplace, it’s a long way from Google’s, as I discovered this week when I dropped in at Google’s East Coast headquarters, a vast former Port Authority shipping complex that occupies a full city block in the Chelsea neighborhood of Manhattan. Yahoo set off a nationwide debate about workplace flexibility, productivity and creativity last month after a memo with the directive surfaced on the Internet. “We need to be one Yahoo, and that starts with physically being together,” read the memo from Jackie Reses, Yahoo’s director of human resources, which went viral after Kara Swisher posted it on AllThingsD.
The discussion may have been all the more heated since the ban was imposed by one of the relatively few female chief executives, one who had a nursery built near the executive suite after she gave birth last year.
Google’s various offices and campuses around the globe reflect the company’s overarching philosophy, which is nothing less than “to create the happiest, most productive workplace in the world,” according to a Google spokesman, Jordan Newman. But do its unorthodox workplaces and lavish perks yield the kind of creativity it prides itself on, and Yahoo obviously hopes to foster?
Mr. Newman, 27, who joined Google straight from Yale, and Brian Welle, a “people analytics” manager who has a Ph.D. in industrial and organizational psychology from New York University, led me on a brisk and, at times, dizzying excursion through a labyrinth of play areas; cafes, coffee bars and open kitchens; sunny outdoor terraces with chaises; gourmet cafeterias that serve free breakfast, lunch and dinner; Broadway-theme conference rooms with velvet drapes; and conversation areas designed to look like vintage subway cars.
The library looks as if Miss Scarlet (from the board game Clue) has just stepped out, leaving her incriminating noose (in the form of a necktie) prominently draped on the back of an oversize wing chair. A bookcase swings open to reveal a secret room and even more private reading area. Next to the recently expanded Lego play station, employees can scurry up a ladder that connects the fourth and fifth floors, where a fiendishly challenging scavenger hunt was in progress. Dogs strolled the corridors alongside their masters, and a cocker spaniel was napping, leashed to a pet rail, outside one of the dining areas.
Google lets many of its hundreds of software engineers, the core of its intellectual capital, design their own desks or work stations out of what resemble oversize Tinker Toys. Some have standing desks, a few even have attached treadmills so they can walk while working. Employees express themselves by scribbling on walls. The result looks a little chaotic, like some kind of high-tech refugee camp, but Google says that’s how the engineers like it.
“We’re trying to push the boundaries of the workplace,” Mr. Newman said, in what seemed an understatement.
In keeping with a company built on information, this seeming spontaneity is anything but. Everything has been researched and is backed by data. In one of the open kitchen areas, Dr. Welle pointed to an array of free food, snacks, candy and beverages. “The healthy choices are front-loaded,” he said. “We’re not trying to be mom and dad. Coercion doesn’t work. The choices are there. But we care about our employees’ health, and our research shows that if people cognitively engage with food, they make better choices.”
So the candy (M&Ms, plain and peanut; TCHO brand luxury chocolate bars, chewing gum, Life Savers) is in opaque ceramic jars that sport prominent nutritional labels. Healthier snacks (almonds, peanuts, dried kiwi and dried banana chips) are in transparent glass jars. In coolers, sodas are concealed behind translucent glass. A variety of waters and juices are immediately visible. “Our research shows that people consume 40 percent more water if that’s the first thing they see,” Dr. Welle said. (Note to Mayor Bloomberg: Perhaps New York City should hide supersize sodas rather than ban them.)
Craig Nevill-Manning, a New Zealand native and Google’s engineering director in Manhattan, was the impetus behind the company’s decision to hire a cadre of engineers in New York, and he led an exodus to Chelsea from what was a small outpost near Times Square. “I lobbied for this building,” he told me. “I love the neighborhood. You can live across the street. There are bars and restaurants.”
He showed me a map of the city with dots indicating where each Google employee lives. They’re heavily concentrated in Manhattan below 34th Street, Brooklyn and the Upper West Side, most within walking distance of Chelsea or a short subway ride away. “We inherited the informal work environment — the casual dress, the flexible hours — from Silicon Valley, but we adapted it to the East Coast urban environment,” he said. After the dot-com collapse in 2000, Manhattan was largely written off as a technology center. Since Google’s move, Chelsea is mentioned in the same breath as Silicon Valley. Google has turned over 22,000 square feet of its space, rent-free, to Cornell until its new technology campus can be built on Roosevelt Island.
“The philosophy is very simple,” Mr. Nevill-Manning said. “Google’s success depends on innovation and collaboration. Everything we did was geared toward making it easy to talk. Being on one floor here removed psychological barriers to interacting, and we’ve tried to preserve that.” Among innovations that sprang from seemingly chance office encounters are the Google Art Project, which is putting thousands of museum works online, and enhancements to the company’s AdSense and AdWords advertising platforms. Razor scooters make it easy to get around the huge floors (each covers five acres), which offer every conceivable gathering space, from large open spaces to tiny nooks with whimsical furniture. It was Mr. Nevill-Manning’s idea to install the ladder connecting floors, now that Google is too large to fit on one. He said he wouldn’t go so far as to say cost is no object, but software engineers “are incredibly productive on a square foot basis,” he said. “Their value is enormous. It doesn’t cost that much to make them happy.”
Allison Mooney, 32, joined Google two years ago from the advertising giant Omnicom Group, and the difference is “night and day,” she said. “I came here from the New York agency model, where you work constantly, 24/7. You answer every e-mail, nights and weekends. Here, you don’t have to show you’re working, or act like you’re working. The culture here is to shut down on weekends. People have a life.”
And the perks, she added, are “amazing.” In the course of our brief conversation, she mentioned subsidized massages (with massage rooms on nearly every floor); free once-a-week eyebrow shaping; free yoga and Pilates classes; a course she took called “Unwind: the art and science of stress management”; a course in advanced negotiation taught by a Wharton professor; a health consultation and follow-up with a personal health counselor; an author series and an appearance by the novelist Toni Morrison; and a live interview of Justin Bieber by Jimmy Fallon in the Google office.
This in addition to a full array of more traditional employee benefits. Curiously, there’s some exercise equipment but no fitness center (Google’s headquarters in Mountain View, Calif. has multiple state-of-the-art fitness centers) because Manhattan employees said they preferred joining health clubs to exercising with colleagues. (Google subsidizes the gym memberships.) And there’s no open bar, although alcohol is served at T.G.I.F. parties (now held on Thursdays), one of which featured a dating game.
After my visit, I spoke to Teresa Amabile, a business administration professor at Harvard Business School and co-author of “The Progress Principle,” about creativity at work, and told her I had just been to Google. “Isn’t it fantastic?” she said. Some of her former students work there, and “they feel very, very fortunate to be there,” she said. As to the broader relationship between the workplace and creativity, “there’s some evidence that great physical space enhances creativity,” she said. “The theory is that open spaces that are fun, where people want to be, facilitate idea exchange. I’ve watched people interact at Google and you see a cross-fertilization of ideas.” That said, she added, “there isn’t a lot of research to support this. And none of this matters unless people feel they have meaningful work and are making progress at it. In over 30 years of research, I’ve found that people do their most creative work when they’re motivated by the work itself.”
Ben Waber, who has a Ph.D. from M.I.T. and is the author of “People Analytics,” is, at 29, the median age of Google employees. His company, Sociometric Solutions in Boston, uses data to assess workplace interactions. “Google has really been out front in this field,” he said. “They’ve looked at the data to see how people are collaborating. Physical space is the biggest lever to encourage collaboration. And the data are clear that the biggest driver of performance in complex industries like software is serendipitous interaction. For this to happen, you also need to shape a community. That means if you’re stressed, there’s someone to help, to take up the slack. If you’re surrounded by friends, you’re happier, you’re more loyal, you’re more productive. Google looks at this holistically. It’s the antithesis of the old factory model, where people were just cogs in a machine.”
Both experts were critical of Yahoo’s plan to force employees into the office. “If you’re spying on them, monitoring them or coercing them, it will create a poisonous atmosphere,” Dr. Waber said.
Professor Amabile added: “Google doesn’t have to force people. Marissa Mayers’s mistake may have been not being more clear about the need to be together and to experience creative excitement. Taking a hard line is likely to have negative effects.”
A Yahoo spokeswoman responded: “We don’t discuss internal matters. This isn’t a broad industry view on working from home. This is about what is right for Yahoo, right now.”
It should probably be obvious at this juncture, but Google doesn’t require employees to work from the office. It doesn’t even keep track of who’s there. The notion seems to have never occurred to anyone. “I don’t think we’ve ever had a policy on that,” Mr. Newman said, but “we do expect employees to figure out a work schedule with their team and manager. It’s not a free-for-all.”
For a company with Google’s largess — and the profit margins that make it possible — it’s hardly necessary to require employees to be at the office. “People want to come in,” Ms. Mooney said. On average, she estimates she spends nine hours a day there, five days a week. She mentioned that she recently took a day off — and ended up at the office.
“I live in a studio apartment,” she explained. “And I don’t have free food.”