How Google Works

How do you build and scale a company that thrives in the digital age rather than collapses under bureaucracy? In How Google Works, Eric Schmidt and Jonathan Rosenberg argue that success in the Internet Century doesn’t come from rigid plans or top-down control but from designing organizations where smart creatives—people who are technically expert, business-savvy, and creatively restless—can collaborate, experiment, and innovate at high velocity.

They contend that old management models optimized for predictability and efficiency fail when technology repeatedly reshapes industries. Instead of order and hierarchy, modern organizations need openness, access to data, rapid decision-making, and a culture that scales moral and intellectual judgment across thousands of employees. The book draws on Google’s evolution—from a messy startup competing with giants to an adaptive platform company—to outline principles that any leader can use to build a durable, fast-learning organization.

Culture as the Operating System

Culture is not decoration; it’s an operating system for behavior. It sets what matters, what’s rewarded, and how decisions get made. Larry Page and Sergey Brin embedded values—like “Focus on the user,” “Don’t be evil,” and “Long-term focus”—into everything, even the IPO letter. These values weren’t platitudes but working rules that shaped countless engineering and business decisions. Signals mattered more than slogans: when Larry scrawled “THESE ADS SUCK” on a kitchen board, that authentic gesture catalyzed a prototype that reinvented advertising relevance. Culture was how Google scaled judgment.

People First: Hire and Empower Smart Creatives

Hiring is treated as the most important job in the company. Decisions rest with peer-based committees rather than isolated managers to avoid bias and promote long-term fit. The focus is on trajectory, curiosity, and collaborative spirit (“Googleyness”) rather than perfect resumes. Once hired, smart creatives need freedom, data access, and authentic missions—not hierarchy. Investment goes to compute power, open tools, and office designs that provoke creative collisions. Innovation happens when autonomy meets purpose and friction is turned into better ideas rather than suppressed dissent.

Strategy Built on Foundations, Not Fixed Plans

In a fast-changing world, five-year plans don’t endure. The better approach is to define guiding principles rooted in technical insight and scale potential. Google’s breakthroughs—PageRank for search, relevance scoring for ads, and Android’s open source model—show that real advantage stems from deep understanding of the underlying technology and user experience. Strategies prioritize platforms and openness where possible, creating self-reinforcing network effects. When leaders focus on foundational ideas rather than static forecasts, teams iterate toward success instead of defending obsolete plans.

Decision-Making and Organizational Speed

The rhythm of decision-making separates slow companies from fast ones. Google’s norm of data-driven debate—two projectors per meeting, one for metrics—helped leaders move from opinion to evidence. Consensus meant informed dissent, not unanimity. Timing mattered: leaders had to know when to stop debating and act. Bill Campbell’s advice (“Do something, even if it’s wrong”) captured the bias toward execution. Meeting discipline—clear ownership, agendas, and follow-ups—turned discussion into outcomes instead of status displays.

Communication, Openness, and Trust

Information flow must be as open as possible. Google built tools that made truth visible—Moma, OKRs, snippets, and TGIF sessions. Leaders shared board slides internally, democratizing insight. Rituals like Dory voting and red-and-green paddles kept Q&A transparent. This openness reinforced psychological safety, allowing problems to surface early. Leaders acted as routers, not gatekeepers—reward candor, route truth, and celebrate those who confess and comply rather than hide failures.

Innovation as Primordial Ooze

Innovation doesn’t come from a department; it comes from environmental design. The “ooze” metaphor captures how new ideas mutate and combine across boundaries. Structures like the 70/20/10 resource rule and 20% time protect creative freedom. Small bets and side projects, from Gmail to Street View, show that serendipity needs space. Constraints, like limited budgets, can boost creativity. The leader’s role is to nurture this ooze—defend risk-takers, eliminate bureaucracy, and let natural selection decide which ideas live.

Scaling Through Structure and Careers

A structure for speed requires flat hierarchies, large managerial spans, and small, empowered teams. Transparency across reorgs and open documentation maintain trust and adaptability. Career development complements autonomy: rotate top talent, pay disproportionately for impact, and give rising stars room to learn. Exceptional performers deserve freedom and recognition; hoarded talent stagnates. Managing careers means helping people catch the next wave—not tying them to dying industries.

Legal and Leadership Agility

In fast companies, legal and leadership practices must match speed and adaptability. “Horseback law” means quick, pragmatic legal counsel embedded in teams rather than slow review silos. Coaches like Bill Campbell help leaders stay self-aware and prioritize what matters—the 80/20 rule of focusing energy on revenue-driving core work. Succession planning identifies those with long-term potential, not just current rank. Leadership is less about command and more about humility, coaching, and curiosity.

Adapt to Platforms and Ask Hard Questions

Finally, digital platforms redefine competition and opportunity. Leaders must ask disruptive questions—what could be true in five years, which platforms could unbundle your business, and how your organization will respond. Governments and industries succeed when they embrace openness, education, and experimentation. The Internet Century rewards those who stay curious, move fast, and never stop questioning their own assumptions.

Taken together, Schmidt and Rosenberg’s framework redefines management: build culture as the code of conduct, hire smart creatives, design for openness and speed, and treat innovation as an evolving ecosystem. What worked at Google could work anywhere—if leaders dare to optimize for learning instead of control.

Culture governs behavior more effectively than rules or policies. Schmidt and Rosenberg argue that when culture is alive, judgment scales. Google’s moral anchor—“Don’t be evil”—was operational, giving every employee authority to pull the plug on unethical projects. The founders made culture visible through rituals and their own actions, setting consistent signals about integrity, meritocracy, and dissent.

Design for Collaboration and Evidence

Offices were messy by design, forcing interaction. Decision-making favored data over hierarchy; the best idea won regardless of title. When Sergey Brin abandoned his own proposal after evidence favored an engineer’s alternative, it demonstrated cultural humility. Structures like TGIF and memegen translated principles into practice, making culture not abstract but social and self-reinforcing.

Guardrails and Character

Google differentiated “knaves” (low integrity) from “divas” (high-performing but difficult). Knaves are expelled because they corrode trust; divas are coached because they amplify progress. You must make those moral distinctions explicit. Character remains the hidden infrastructure of scalable culture.

A living culture acts like an organism—self-correcting, visible, and empowered to act without waiting for orders. When culture works, leadership becomes distributed judgment.

Hiring defines innovation capacity. Schmidt and Rosenberg liken Google’s hiring process to academia—peer review, not manager fiat. Committees evaluate standardized packets with data and candidate scores to ensure fairness and repeatability. Larry Page personally reviewed offers to enforce rigor. The payoff: consistency and insulation from short-term bias.

Focus on Traits, Not Titles

The best hires are generalists who learn fast. The Associate Product Manager program proved that creative generalists, given authority, can ship major products early in their careers. Seek trajectory and curiosity—not just credentials. “Googleyness” captures that mix of intellectual curiosity, teamwork, and playful intensity.

Interview Discipline and Peer Engagement

Interviews are structured—short, purposeful, and scored with defined categories such as cognitive ability and leadership. After four interviews, returns diminish; rigor beats volume. Data on interviewer reliability is published internally to reinforce accountability. Recruiting is everyone’s job—the herd effect ensures great people attract great people.

Empowering smart creatives means giving autonomy once hired: open communication, tools, and missions that inspire. Success comes from freedom coupled with aligned values, not control.

In unpredictable environments, plans are guesses. The authors stress foundation-based strategy anchored in technical insight and iterative learning. Google’s PageRank and AdWords illustrate how breakthroughs emerge from deep computation, not market mimicry. The question is always: “What technical insight makes our product fundamentally better?”

Scale Through Platforms and Openness

Platform thinking—creating systems that get stronger as users join—drives growth. Android’s openness seeded a global ecosystem; YouTube empowered creators. Yet openness must be pragmatic: some assets stay closed for quality or security. Strategy becomes adaptive rather than doctrinal.

Decide with Evidence, Not Ego

Data-centric meetings replaced slides with dashboards. Dissent was expected, not punished. The China withdrawal decision showed consensus through open argument and principled choice. Effective leaders know when debate must stop—ringing the bell moves the organization forward. “Do something, even if it’s wrong” reminds teams that execution beats paralysis.

When decisions combine evidence, dissent, and timely closure, strategy stays alive and learning accelerates.

Innovation thrives in messy, organic environments. The “Primordial Ooze” metaphor conveys conditions where ideas evolve through collision and variation, not committee approval. Innovation is defined as new, surprising, and radically useful. Leaders act as gardeners, not gatekeepers—they protect small bets and enable creative mutation.

Systems of Controlled Freedom

Structures like the 70/20/10 resource rule and 20% time institutionalized exploration. Gmail, Google Suggest, and Street View emerged from grassroots experiments. These structures ensure innovation is not squeezed by short-term priorities. Constraints, paradoxically, stimulate more invention—Larry Page’s rented tripod experiment for Google Books saved millions and accelerated learning.

Natural Selection and First Followers

Strong ideas survive by attracting believers. Derek Sivers’ “first follower” principle applies inside organizations—the lone innovator needs visible allies to legitimize risk. Establish forums that let people join experiments easily. Treat failure as tuition, not stigma; reuse tech and teams after projects die.

Innovation can’t be mandated, but it can be nurtured. The CEO is effectively the Chief Innovation Officer—responsible for protecting the ooze from bureaucracy.

Structure, communication, and process determine whether creativity scales or stalls. Google’s organizational design favors flatness (rule of seven) and transparency. Reorgs happen publicly and quickly, reducing anxiety. Small teams ship faster; platforms capture long-run benefits. High-impact individuals become nuclei for expansion.

Communicate as a Router

Leaders must act like routers—sharing information openly, rewarding truth-tellers, and killing opacity. Systems like OKRs, snippets, and Dory Q&As make truth flow. Overcommunication requires clarity and authenticity: respond fast, write crisply, and make messages actionable. The “Climb, Confess, Comply” ritual turns mistakes into teachable moments.

Legal on Horseback

Legal teams adapt through “horseback law”—fast, pragmatic guidance integrated with product teams. Lawyers ride alongside innovation, offering quick reads and returning to deeper study only when stakes require. This balance preserves speed without courting recklessness.

Fast communication and agile counsel harmonize a digital organization’s metabolism—information moves, risk is managed, and truth circulates freely.

The modern leader is coach, curator, and futurist. Bill Campbell coached Google executives—not to direct their decisions but to help them see blind spots and prioritize talent. Leaders need external perspective to stay humble and effective. They also plan succession early, identifying the next generation of future “sons” who will carry the torch, not just peers comfortable today.

Focus, Feedback, and Humility

Bill Gates’s “80% on the 80% of revenue” rule shapes discipline. CEOs must protect the core business while exploring new waves. Annual self-reviews create authenticity—Eric Schmidt’s own acknowledgment of earlier missteps fostered honesty and trust across ranks.

Facing Digital Disruption

Platforms redefine industries overnight. Leaders must ask “What could be true in five years?” rather than “What do we expect next quarter?” When Vic Gundotra saw social networks reshaping engagement, he created Google+ to keep pace. The habit of asking hard, hypothetical questions guards against complacency.

In the Internet Century, leadership blends coaching, humility, technical curiosity, and courage to act on emerging truths before they are obvious. Those who combine these qualities design futures rather than react to them.