Blitzscaling 08: Eric Schmidt on Structuring Teams and Scaling Google | Summary and Q&A

TL;DR

Eric Schmidt discusses the importance of blitzscaling and leadership in the growth and success of companies, emphasizing the need for broad vision and innovation.

Key Insights

• ❓ Hiring talented individuals who share the company's values and purpose is crucial for successful scaling.
• 🥺 Emphasizing broad vision and innovation can lead to the creation of new and successful products and features.
• 👻 Allowing employees time and freedom to pursue personal projects can foster a culture of innovation.
• 💱 Successful scaling requires effective leadership and the ability to adapt to changing circumstances.

Transcript

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Questions & Answers

Q: What lessons did Eric Schmidt learn from his career at Sun and Novell that helped him at Google?

Schmidt learned the importance of absorbing knowledge and staying adaptable as a young manager. He also understood the significance of cash management and revenue focus at Sun, which influenced his approach at Google.

Q: How did Eric Schmidt handle the role of CEO at Google?

Schmidt's role as CEO at Google was to manage the chaos and provide organizational structure. He hired non-essential executives to handle different functions, while Larry Page and Sergey Brin focused on the technical side of the company.

Q: What role does innovation play in the success of a rapidly growing company like Google?

Schmidt believes in hiring people with a broad vision and allowing them to explore and innovate. Google's "20% time" policy, where employees spend a portion of their time working on personal projects, has led to the creation of many successful features and products.

Q: How did Google maintain a culture of innovation as it scaled?

Google emphasized shared values and a strong sense of purpose. Hiring talented individuals who were passionate about their work and providing them with opportunities for growth and exploration helped nurture innovation within the company.

Summary

In this video, Reid Hoffman interviews Eric Schmidt about his career journey and his experience scaling companies, particularly focusing on his time at Google. Schmidt shares insights and lessons learned from his work at Sun and Novell, as well as the challenges and strategies he implemented at Google to scale the company from 150 employees to over 60,000 employees. He discusses the importance of making quick decisions and learning from mistakes, the role of cash and revenue in running a company, and the significance of having the right product before scaling. Schmidt also talks about the dynamics between founders and new hires, the hiring and interview processes at Google, and the role of management in a fast-growing organization.

Questions & Answers

Q: What did Eric Schmidt learn from his time at Sun and Novell that helped him at Google?

Eric Schmidt learned valuable lessons at Sun and Novell that were helpful in his role at Google. At Sun, he absorbed everything as a young manager and it influenced his management style moving forward. He learned that companies can reorganize prematurely, become religious, and not react to facts. At Novell, he learned that companies can have cooked books, fraudulent people, non-paying customers, and more. However, he also learned that it is possible to overcome such challenges and develop skills that can be applied to future success.

Q: If Eric Schmidt could go back to his younger self, what advice would he give about doing things differently before joining Google?

Schmidt believes that most answers about doing things differently in the tech industry are to do things sooner and make fewer mistakes. In hindsight, he would have made decisions faster and made fewer mistakes. He questions why he didn't make decisions more quickly and speculates that some people are simply quicker decision-makers than others. Schmidt emphasizes that in hindsight, it is typical for executives to say they should have fixed things earlier or made certain changes sooner.

Q: When Eric Schmidt joined Google, what was the size of the company?

When Eric Schmidt joined Google, the company had around 150 employees.

Q: What was the process for hiring a CEO at Google?

Venture capitalists had invested $25 million in Google and believed that Larry Page and Sergey Brin needed a proper CEO. Larry and Sergey agreed to hire a CEO, but with the condition that they could vet the candidates by spending a weekend with them. Each candidate spent a weekend doing various activities, and this strategy ensured that no one got hired. Eventually, Eric Schmidt was called by John Doerr and although he initially refused, they ended up meeting and agreeing on the terms. Schmidt made a list of things that needed to be fixed at Google and once they were addressed, he joined the company.

Q: What were some of the things on Eric Schmidt's list of things that needed to be fixed at Google?

Eric Schmidt's list of things to fix at Google included international expansion plans, sales plans, hiring plans, proper accounting and understanding of inventory, development plans, and 18-month product plans that did not exist at the time. Google had a culture of interesting conversations without accountability or deliverables, and Schmidt aimed to introduce more structure and goal-setting.

Q: What advice would Eric Schmidt give to his younger self about doing things differently pre-Google?

Schmidt believes that the general advice in the tech industry is to do things sooner and make fewer mistakes. Looking back, he would have made decisions faster and made fewer mistakes. He ponders why he wasn't quicker in making decisions and suggests that some people are simply faster decision-makers than others. Schmidt discusses the tendency for executives to reflect on the need to fix things earlier or make changes sooner.

Q: How did Eric Schmidt handle the dynamics between the founders and new hires at Google?

Eric Schmidt recognized that Larry Page and Sergey Brin were the founders and owners of Google, and he considered himself as the outsider who was hired as the CEO. He understood that it was their company and he made sure not to become confused about his position. Schmidt avoided doing press interviews, allowing Larry and Sergey to take the spotlight as the founders. He embraced the fact that it was their company and adopted a supportive role. Schmidt emphasizes the importance of understanding the dynamics and roles within a company, especially when founders are involved.

Q: What was the size of Google's employee base when Eric Schmidt joined the company, and how did it grow over time?

When Eric Schmidt joined Google, the company had around 150 employees. Over time, Google experienced rapid growth and expanded its workforce to over 60,000 employees. Between 2004 and 2005, Google tripled its number of employees, serving as a classic example of blitzscaling.

Q: What were some of the techniques and processes Google invented to scale the company quickly and effectively?

Google implemented several techniques and processes to scale the company quickly and effectively. They focused on hiring high-IQ generalists from prestigious universities and introduced a rigorous and involved interview process. They reviewed every offer packet and ensured scoring was unbiased through statistical analysis. Schmidt also mentions the importance of having a small team with strong leaders who can make decisions and produce products that just barely work. Furthermore, Google emphasized the need to have judgment around when a product is ready to scale and globalize.

Q: How did Eric Schmidt handle the challenges of managing a fast-growing organization at Google?

Schmidt approached the management of Google by running the company as a group and keeping a chaotic, innovative marketing strategy while maintaining rigor and structure in the background. They implemented weekly meetings and review processes to keep track of progress and ensure accountability. Schmidt also emphasizes the importance of hiring the right people and creating a culture that hires high-IQ generalists from prestigious universities who have experienced stress or achieved something exceptional.

Q: What were some of the key factors that worked and didn't work when it came to managing and promoting employees within the fast-growing organization at Google?

Eric Schmidt preferred to manage Google as a group rather than divisionalize and operate through the traditional hierarchy. They conducted regular meetings such as "60 minutes" and "Google Product Strategy" to review progress and ensure alignment. Schmidt mentions the importance of making hiring decisions carefully, hiring people who are high-IQ generalists and have achieved something exceptional. They also implemented a thorough interview process and ensured that promotions and management decisions were based on rigorous evaluation.

Summary & Key Takeaways

• Eric Schmidt reflects on his career before Google and the lessons he learned from his experiences at Sun and Novell that helped shape his approach at Google.

• He emphasizes the importance of the next five to ten years of one's career in developing crucial leadership skills.

• Schmidt discusses the challenges and strategies for scaling and managing a rapidly growing company like Google, including the importance of hiring the right talent and promoting innovation.