Companies of the Future

Fortune magazine had an interesting article this month profiling the top 25 more powerful business people in Asia. In the introduction to that article, they mused on how the power pendulum has most definitely swung if not from the U.S. to Asia, at least to a more Asian-leaning direction. Of the top 25, the top 5 include:

1. Akio Toyoda of Toyota fame (and misfortune)
2. Ratan Tata of Tata Sons, leading a conglomeration of over 98 companies that do everything from hotel management, perform IT work, produce tea and build cars. His dreams of an affordable "consumer car" like the Nano (priced at $2900, 50mpg) is currently only in India. But he has his sights set on the U.S. market as well
3. Mukesh D. Ambani of Reliance Industries, is most popular as a "deal-maker", persuading big oil companies (BP) to invest heavily in India. He also was the first non-American nominated to Bank of America's board of directors
4. Kun-Hee Lee of Samsung has revolutionized the way Korean (and now global) consumers think about consumer electronics. Samsung's brand is now known worldwide for providing quality cellphones, televisions and computer chips
5. Ren Zhengfei of Huawei technologies is now China's largest telecom producer. Looking to branch into the American market, he has established a new R&D center in California

Unsurprisingly, the top 5 are all men, which is a bit disheartening, but there is a woman on the list! At #17, Chanda Kochhar is the managing director and CEO of ICICI bank, the largest bank in India, so there is some hope that the pendulum is not only swinging geographically, but across genders as well. All of this talk though made me wonder- so these are the most powerful business people in the world, but what about the companies they manage? What makes a company great?

I reflected on a conversation that I had yesterday with a good friend of mine, where he said that if he could start his own company someday, no matter what industry that company happened to be in, he would model it after Google. After we hung up, I reflected on his idea- in many ways, Google has done it right and is undoubtedly one of the most sought-after companies for employment (and not only in Silicon Valley!). But what makes it great?

Google's model is "Don't Be Evil", and of course there is a lot of controversy about that. Particularly after its ordeal in China (also highlighted in Fortune magazine this month), Google has had a lot of negative press. From the Chinese people it was "Why did you give up on us? You should've kept fighting!", from the Chinese government it was "Google doesn't play nice- look how petty they're being" and the news we got here in America was slightly confusing- "Google is trying to work things out, but refuses to cooperate. Google is fighting because they believe in the freedom of speech, but mostly because they see a huge untapped market in China. Conspiracy! The Chinese Google equivalent (Baidu) never had outages or system problems, but Google has them all the time!". Although Google has since withdrawn from China, it still hopes to move there in the future. Overall I see this as a loss to China because Google has so much to offer- if nothing else, it offers a strong case study on how to treat employees right. Maybe it's because I'm still very sensitive since the merger of my own company, but here's some things that I think Google does fantastically:

1. Letting Employees Know They Are Valued: Undoubtedly, I think this is the number one most important thing. Assuming that you are getting the types of people you want and that you want to keep these employees (related but not necessarily synonymous), this step is critical. Some companies stop at stock options or bonuses (and don't get me wrong, money is usually a great tool for this) but Google takes it a step further. Full gyms, free cafeteria food, pet/child care services, on-site dry cleaning and massage therapy, combined with a "fun" atmosphere (Foosball tables and video games) make going to work a pretty sweet gig. And why not? If employees are less concerned about outside things ("Where can I find a good baby sitter?") they're more likely to do a good job at work. 
2. Seeing People as People: Moreover, Google asks that their employees spend 20% of their time pursuing outside interests and hobbies while at work- this sends a clear message that they understand there's value in seeing people as people. Shortly after the earthquake in Haiti, a group of Google employees created a database so that family members could find and contact one another. This has since been adopted by many relief organizations to help reconnect families in disaster areas. That's pretty great from my perspective.
3. Being Flexible and Open: Maybe it's just because of its Silicon Valley upbringing, but Google is known about being flexible and open- the opposite of the normal hierarchy seen at most large companies- and they pride themselves on that fact. Google is known for its open feeling down to its campus- with open cubes, "brainstorming spots" and company leaders who regularly blog on company issues. As with all corporate initiatives, there is a fair amount of criticism, with TechCrunch releasing some "insider information" on Google employees, but this information is a bit dated and seems to be a minority view.

Overall, Google is impressive not only because of its extensive reach and infinite desirability for employees, but also in the reasons why these employees are attracted to Google. Google doesn't only mean a brand name in Silicon Valley, but employees are beginning to value intangibles as well- unsurprising as a we move into an era of outsourcing and teams of 100 or more. Although Google is by no means perfect, I think there is a lot to learn here- other companies should take heed!