Lessons Learned – The Hard Way Eric Schmidt, E&VC Final Class Transcribed by Abheek Anand
About Management Culture:
- You get personal leverage through delegation and empowerment, along with inspection
- Hiring defines a company. Review every job offer every time.
- Manager (or teams reporting to a manager) should never have the unilateral authority to hire people.
- Major decisions should be made in large groups, by two joint owners.
- Be careful about goal-misalignment; goaling drives behavior and conflict.
- Social groups of workers moderate bad behaviors of individuals.
- Meet and find the best decision; drive this to be the consensus. Don’t compromise below the best.
- Organize the company around the people whose impact is highest.
- Measure everything and ask for the supporting data behind everything.
- Beware of managers on power trips; watch out for “I’ll just fire them.”
About People:
- Offices should be designed to maximize energy and interactions, not for isolation and status.
- Employees care more about passion and success than about money.
- Where there is success there is envy.
- Learn something new so that you can remember how hard it is to learn.
- Understand the employee always has a choice.
- All people should work on more than one thing.
- Nothing gives you more leverage than hiring a fantastic employee.
- People care more about what their peers think than what their bosses think; use this.
- Diversity is your best defense against myopia.
- There is a fine line between arrogance and self-confidence.
- Arrogance is inversely correlated with age. Some harden, however.
- Employees want to be paid and treated fairly and to feel that they are appreciated and respected.
About Being a CEO or Leader:
- Run a company for the long term; CEO’s goal is to build a 20-year durable institution.
- Spend 80% of your time on where the next 80% of your revenue is going to come from.
- Demolish a Culture of Fear.
- There is never enough communication inside a company.
- Sometimes you act, sometimes you wait, sometimes you ignore.
- Make sure you would work for yourself.
- Trust, but verify.
- Publish notes for every meeting.
- Repetition does not spoil the prayer.
- Be brutal to people who violate the basic interests and threaten the company.
- Engineers add complexity, marketing adds management layers, sales adds assistants. Manage this.
- Instead of laying off the bottom 10%, don’t hire them!
- Run the management training program yourself, and be good at it.
Managing the Business:
- If something is growing then it is good and gets more resources and if it’s not, starve it.
- Share objectives and performance and snippets weekly.
- Promotion should be a peer-reviewed process, not a top-down management decision.
- Individual contributors understand the details of their business areas much more thoroughly than management.
- The most important attribute in an organization is its ability to get out of the way. This is also true for managers.
- Flat organizations increase information flow and empower employees.
- Organizations need to concentrate on value, rather than costs.
- Trust is your most potent weapon. Never squander it.
- None of us is as smart as all of us.
About Yourself:
- Every move you make is watched by the employees. Think before you act or speak.
- Every employee is alert to management hypocrisy.
- Teach something so you can learn it.
- You learn more by listening than talking.
- The consummate management skill is betting your future on the efforts of other people who are so much better than yourself.
- Leadership requires passion - if you dont have it, get out now.
- Culture is set by the top of the company, once set very hard to change.
- Tell the truth, be humble, bank goodwill for a rainy day
- Solve over-management by maxing out direct reports per manager. Solve under-management by setting the right culture.