Stefano Lam | Reuters
Google is launching a new effort called the “Simplicity Sprint” in an effort to improve efficiency and improve employee attention during an uncertain economic environment.
The Alphabet company had its regular engagement last Wednesday and the tone was somewhat urgent as employees expressed concern over the layoffs and CEO Sundar Pichai asked employees for input, according to attendees and related internal documentation viewed by CNBC. Google’s productivity as a company is not where it should be even with the headcount it has, Google CEO Sundar Pichai told employees at the meeting.
“I wanted to provide additional context after our earnings results and ask for your help as well,” Pichai opened, referring to the company’s second quarter earnings report on Tuesday. “It is clear that we are facing a challenging macroeconomic environment with greater uncertainty ahead of us.”
He added: “There are real concerns that our productivity as a whole is not where it should be for the staff we have.” He asked employees to help “create a culture that is more mission-centric, more product-focused, more customer-centric. We should think about how to minimize distractions and really raise the bar of both product excellence and productivity. “.
It comes after the company reported its second consecutive quarter of lower-than-expected earnings and revenues on Tuesday. Revenue growth slowed to 13% in the quarter from 62% the previous year, when the company was benefiting from the post-pandemic reopening and consumer spending was on the rise. CFO Ruth Porat said she expects some of the challenges to continue in the near term, but the company does not provide formal guidance.
It also comes after Pichai recently announced he will slow the pace of hiring and investment until 2023, asking employees to work “more urgently” and “hungrier” than shown “on the sunniest days.”
“Sprint of simplicity”
“I would love to have all of your help,” Pichai said during the meeting on Wednesday, speaking to his more than 170,000 full-time employees.
To this end, Pichai introduced a “Simplicity Sprint” initiative to crowdsource ideas for faster product development. “Sprint” is a term often used in software development and by tech startups to denote short, focused pushes towards a common goal.
Pichai said the company is paving the way for employees to share their ideas through Aug.15 through an internal survey asking if management can contact if they have any follow-up questions.
It’s an attempt for the company to “get better results faster,” Pichai said at the meeting. The survey, which was viewed by CNBC, shows it could also be used to cut back in some areas.
Survey questions include “What would help you work more clearly and efficiently to serve our users and customers? Where should we remove the bumps to get better results faster? How do we eliminate waste and stay entrepreneurial and focused as we grow?
The demand also comes as the company tries to ease tensions between employees and executives after an annual “Googlegeist” survey showed that staff gave the company particularly poor ratings on pay, promotions and execution.
Highlighting a 7% drop in views on Google’s execution, executive Prabhakar Raghavan at the time wrote “this means we need to pay more attention to the dismantled bureaucracy.” Raghavan is among the company’s most prominent and influential executives, overseeing research, announcements, mapping and other areas.
In May, the company announced that it would revise its performance appraisal process which will result in a pay rise hoping to cut red tape related to pay and raise.
‘A little anxiety’
In the full-fledged meeting on Wednesday, executives addressed employee concerns about potential layoffs. One of the most popular questions was “In light of Sundar’s claim that sharpening Google’s focus” means consolidating where investments overlap and streamlining processes, “should we expect layoffs?”
Pichai passed the question to Fiona Cicconi, Google’s chief people officer.
While Cicconi said the company is still hiring and has no plans for layoffs right now, he didn’t rule it out.
“We are asking teams to be more focused and efficient and we are trying to understand what it means as a company as well. While we can’t be sure about the economy going forward, we’re not currently trying to shrink Google’s overall workforce. ”
He also said: “I really understand that there is some anxiety about this based on what we are hearing from other companies and what they are doing and, as Sundar said, we are still hiring for critical roles,” he said. Cicconi. He asked employees to remember that it is still the most important hiring year in the company’s history.
In the second quarter, Alphabet said its headcount increased 21% to 174,014 full-time employees from 144,056 a year earlier. However, the company said last month that it will slow the pace of hiring and investment until 2023, and CEO Sundar Pichai told employees in a reminder: “We are not immune to economic headwinds.”
Pichai has repeatedly noted the broader economic headwinds. “If you’re looking at what’s happening externally, I’m sure you’re reading all the news, people in companies using Google products are facing their own challenges right now.”