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Musings Report #33 8-14-15 Facebook, Recreating Silicon Valley and the Future of Work
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Facebook, Recreating Silicon Valley and the Future of Work
I confess to being skeptical of anything that smacks of hype coming out of Silicon Valley, and I recently posted an essay suggesting that the spate of new headquarters going up in Silicon Valley presages a decline in the tech titans constructing the new HQs--Apple, Facebook, LinkedIn, and Google, whose plans to build a new HQ in Mountain View were recently squashed by the city council.
Despite this skepticism, I welcomed an opportunity to have a private tour of Facebook's new headquarters (Zones 1 - 5 in the Facebook world), courtesy of a friend who works in Zone 4.
One reason to tour the building is purely architectural, as it was designed by super-architect Frank Gehry, whose major public buildings include the Disney center in L.A., the museum in Bilbao, Spain and the Experience Music Project Museum (Jimi Hendrix museum) in Seattle.
To the best of my knowledge, Facebook's commercial building is somewhat of a departure for Gehry's office.
I was skeptical of Gehry's work until I walked around his first significant project, a remodel of his house in Santa Monica, Calif. The remodel is a wild mix of intentionally in-your-face sheet metal and Asian-influenced tranquility. Love it or hate it, it's interesting.
This reluctant admiration grew after walking through the Disney Center's metallic skin; narrow walkways enable visitors to peer into the steel framework of the curving metal skin, and to examine the structure from a variety of perspectives.
A visit to the Getty Museum (also in L.A.) cements the recognition that Gehry has a wide palette and a discerning eye. He does not repeat himself, though he re-uses certain favorite materials and themes.
I haven't visited the museum in Seattle, though the photos I've seen make it clear that it is also a very interesting structure.
The Facebook campus has two parts: an older, conventional campus of boring low-rise buildings (the former Sun Micro campus) and the new HQ across the highway. A private tunnel and tram service conects the two.
The old part is conventional Silicon Valley/Corporate America business park. the new building is unconventional and speaks of changes not just in architecture but in corporate management and the future of work.
The tour is one part conventional security (check in on an iPad, get a visitors pass you wear around your neck) and one part free-form: the tour is up to your employee-friend-guide. You are not allowed to photograph/video work desks etc., but are free to photograph the lobbies and public spaces.
As you might have read, the building is one enormous open work space. The Zones are simply lines on a map, not physical barriers. Various departments and work groups have clusters of desks, but no walls separate divisions or work groups.
In a radical departure from the private corner office, top management work in what are known as the Aquariums: glass-walled boxes in the middle of the vast space. Any employee can wander by and see CEO Zuckerberg et al. at work.
Our friend, who is one of the older employees (i.e. late 20s/early 30s), is well-placed to make observations about the day-to-day managerial culture of FB, as she's worked internationally and at very high levels (clerk in a national supreme court, etc.)
So when she reported that any team member is free to approach a top manager, or even a manager of another project, I believe her. She is not a starry-eyed 22-year old with little previous work experience.
The older campus has been fitted out into something she desribed as "a cross of Disneyland and the Truman Show." Public spaces for gathering and playing games dominate the courtyards, and several cafeterias serve free food all day long to employees and their guests. Other cafes serve only dessert or beer/pizza. A free bicycle repair shop fixes the bikes of employees free.
Need a new keyboard for your tablet or cover for your iPhone? Techie accessories are available free in vending machines trhoughout the campus. If your laptop needs a tuneup, there's a free repair shop for all tech devices.
There's also a room filled with old-school console video games, so burned-out programmers can let off steam, a free dry-cleaning service, and multiple free electric-vehicle charging stalls.
All this left me wondering who has time or interest in actually doing work.
But of course work does get done. There are a hundred applicants for every job opening, and in all probability every applicant is bright, dedicated, over-achieving, etc.
The only walls in the new HQ delineate bathrooms and video-conferencing rooms; clearly, staffers are expected to video-conference globally on a regular basis.
(FB just reached 1.5 billion users globally. Even if a third of these are zombie accounts, that still leaves a billion people.)
Our friend explained that each employee gets a number of fee advertising credits on FB which they can distribute to friends/family. Our friend reported that she distributed a few credits to a friend who runs a B&B in the Philippines. Days after launching a cheap advert campaign on FB (less than $100), the B&B had already been booked up for the approaching holiday and was receiving inquiries from surfers globally (it's near a surfing beach).
I tend to think most advertising is a waste of money (even though a chunk of my own income comes from advertising), but being able to access a billion people for a few bucks is impressive leverage. If it fails, you're not out much. Where else can you put your toe in the water for less cash? Not many places at least to my knowledge.
I was ready to dismiss FB as a flash in the pan fad, and the FB HQ as a gimmick. Now I'm not so sure. Facebook has 11,000 employees globally and about 6,000 of those are domestic. I believe about 3,000 or so work in the Menlo Park CA, campus. That's a lot of leverage (1.5 billion users) for only 11,000 employees.
Yes, FB is rolling in cash. It earns about $3 billion on $14.7B in revenues (EBITDA are $6.4B.)
But the experience made me wonder how much of what obviously works for FB in terms of management and workplace culture could be duplicated elsewhere for not much money. If you think about it, how much money would it take to flatten hierarchies? It would actually save money. How much to hire a bike mechanic to fix employees' bicycles? How much to operate a free cafe and a video-game room?
Here's the question Facebook raises: would you rather work at home, or come to work at Facebook? For most people, the answer is clearly: it's much more fun to go to work than stay home.
This is the future of work. The vast majority of the culture and economic leadership don't yet get it, but it's painfully obvious: if you want to hire and retain top talent, you'll have to make work fun. If you can't, or won't, somebody who can will skim all your best employees. Your productivity will decline and you will struggle to reap big profits.
How much of the conventional hierarchy is necessary or even productive? Silicon Valley companies like Google and Facebook are raising this question, and corporate managers are scrambling to copy whatever features of this management style they understand/are allowed to emulate.
Here's the problem for governments and corporations that want to emulate Google and FB: they are intrinsically, steeply hierarchical, and that is precisely what FB and Google are flattening.
This is not new to FB or Google; this is simply an extension of the founding managerial style of Hewlett and Packard and the original Intel founders who laid down the decentralized, free-to-fail bedrock of Silicon Valley culture.
The vast majority of the complaints I hear from peers about working for the state or corporate America arise from counter-productive hierarchies and workplace cultures. Once you visit an alternative, you realize 99% of the conventional workplaces are no fun and not productive because they're designed to be no fun and counter-productive.
Dozens of states and nations have attempted to recreate Silicon Valley. Virtually every one has failed or failed to live up to grandiose expectations. Even the most vaunted (Research Triangle, Silicon Alley, and various business parks in Indonesia, China and India) produce a fraction of the venture capital, patents and profits of the Valley.
Innovation isn't just a new device or app or game; it's about changing the culture of productivity and work and how work gets done. Maybe FB and Google will fade or self-destruct; but the point here is not the individual names, it's the structure of innovation that matters.
If we think about these topics as interconnected, it's no wonder Japan, Europe, China et al.--all profoundly hierarchical--can't reproduce Silicon Valley. Yes, there's tencent, Alibaba, Softbank and Angry Birds, but who's rushing to emulate the way these companies are managed and their culture of work?
Even more profoundly: is it possible for these companies to build a Facebook-like HQ and a management culture to match? Every company is embedded in a larger culture, and the more hierarchical the culture, the farther away it is from the innovations that will matter.
Summary of the Blog This Past Week
Voting With Your Feet 8/14/15
Acquire Skills, Not Credentials 8/13/15
Our Government, Destroyer of Jobs 8/12/15
Stop Financializing the Human Experience 8/11/15
Forget the Fake Statistics: China Is a Tinderbox 8/10/15
Best Thing That Happened To Me This Week
Tour of Facebook and FB's new HQ building, courtesy of our friend A.J. (The free meal at the cafeteria was not bad. They even served free wine as it was Friday.)
Market Musings: Crash or One More High?
For the past six months, US stock markets have been yo-yoing in a trading range--churning up and down in what looks like a distribution-topping pattern of tired Bulls fighting to hit nominal new highs and Plunge Protection Teams saving every decline that threatens to run away.
These periods of indecision often trace out wedges/triangles as swings up and down narrow into tightening wedges that then break up or down in a big way.
After 6.5 years of bullishness, we're due for a meaningful sell-off, and the global recession that is becoming more obvious with every passing day will be the driver of this decline.
But Bulls (and PPTs) are loathe to give up the gains, and so it wouldn't surprise me if this wedge broke to the upside one more time, and just to plant a thumb in the bear's eye, even retested previous highs.
Given the deterioration of the past year in the market's underlying mechanics, it also wouldn't surprise me if the latest rally fails at a lower high and rolls over from there.
At critical junctures, the tea leaves often become hard to read.
From Left Field
Learning to Speak Lingerie: Chinese merchants and the inroads of globalization (via Lew G.)
Why would anyone quit their jobs at dream companies like Facebook or Google? -- even the best job isn't for everyone... these places expect a lot of their employees...
The Bad Behavior of Visionary Leaders --they get away with it because they produce profits....
Hidden Costs: It takes much stuff to make one tiny chip
The Oil Crash Has Caused a $1.3 Trillion Wipeout (via Joel M.)
Inside Shell’s Extreme Plan to Drill for Oil in the Arctic (via Joel M.) -- long read, good intro to the future of oil....
6 Tricks to Get 86% More Chipotle Burrito (for free!) (via Moaxian)
'It's getting worse': China's liberal academics fear growing censorship (via Moaxian)
America's Biggest Problem Is Concentrated Poverty, Not Inequality ... um, aren't they related?
The Future of Work: Why Wages Aren't Keeping Up (via Lew G.) so have incomes risen 50% or not?
Are US Middle-Class Incomes Really Stagnating?
But more accurate government statistics imply that the real incomes of those at the middle of the income distribution have increased about 50% since 1980. -- if you include government transfers... IOW "middle class" now depends on state subsidies for its middle-class status...
What is Coffee Worth to You? (via Ben G.) --interesting first-person account of coffee farming... of interest to me because the Big Island of Hawaii has a flourishing coffee crop and culture... coffee is moving beyond Kona...
"He who is not very strong in memory should not meddle with lying." Michel de Montaigne
Thanks for reading--
charles |
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