Eric Schmidt talks Alphabet, hiring, and company scalability at Stanford University Q&A

By Gabe Carey
Oct 20, 2015
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  1. [parsehtml]<p><img src="" /></p> <p>Speaking to a room full of students in a prestigious Stanford University classroom, Eric Schmidt, executive chairman at Google&#39;s new parent company, Alphabet Inc., shed some light on some of the company&#39;s inner workings. He discussed everything from scaling to hiring to product successes and failures.</p> <p>Led by LinkedIn founder Reid Hoffman, along with other big names in tech, Schmidt provided a lot of detailed information and anecdotes, some of which can be found in his book, &quot;How Google Works,&quot; co-written in collaboration with Jonathan Rosenburg.</p> <p><strong>Alphabet</strong></p> <p>Perhaps most curious were his thoughts on Alphabet, which <a href="">was revealed</a> back in August as an umbrella company for Google and its many subsidiaries.</p> <p>On this topic, he begins by saying that Google became so big that it started falling in on itself. Even Steve Jobs criticized Google for &quot;doing too many things.&quot; Fortunately, Schmidt claims, Google&#39;s size was negligent for quite some time due to having &quot;strong founders and leaders,&quot; but even so the organization, or lack thereof, became too much for one company.</p> <p>&quot;Alphabet is an attempt to build a holding company like Berkshire Hathaway out of an existing operating company,&quot; he explained. &quot;It&rsquo;s never been done before.&quot;</p> <p><strong>On scalability</strong></p> <p>Mentioned frequently was Uber, being used as an example of company scalability. &quot;You&#39;ve got to have products that can scale,&quot; said the former Novell CEO. &quot;What&#39;s new is that once you have that product, you can scale very quickly. Look at Uber.&quot;</p> <p>He discussed the work Larry Page and Sergey Brin would conduct behind his back, leading to the developments of both Chrome and Android, both of which Schmidt initially advised against.</p> <p>&quot;We&#39;re not going to do a browser or OS,&quot; Eric told them. Six months later, after toying with Firefox and attempting to improve its performance, Larry and Sergey brought to Schmidt a working version of Google Chrome. &quot;Those *******s,&quot; he uttered jokingly. &quot;I knew they were going around me.&quot;</p> <p>Then, with AdWords, Schdmit said, a young man named Sal at Google suggested switching from an &quot;as-sold&quot; business model entirely to auctions. &quot;I was so worried that I implemented a cash restriction program,&quot; admitted Schmidt. &quot;The day we turned on the auctions, revenue tripled.&quot;</p> <p><strong>On hiring</strong></p> <p>Of course, since Google doesn&#39;t fire anyone, Schmidt suggests that there&#39;s a lot to bank on when hiring new employees.</p> <p>&quot;You don&#39;t hire generic people,&quot; he advised. &quot;You hire people who have had stress and achievement. The best people to hire are CFOs who&#39;ve gone bankrupt, because they&#39;ve been through wars.&quot;</p> <p>He even went as far as to describe a horror story where someone was interviewed 16 times before being denied a position at Google. &quot;You can&#39;t just do this to people,&quot; Schdmit told the hiring managers. &quot;You&#39;re not allowed to interview them more than 8 times.&quot;</p> <p>Fortunately, there&#39;s a widely enforced company rule now that engineers can&#39;t receive more than 5 interviews while non-engineers max out at 4.</p> <p>Drawing comparisons to Steve Jobs and Sun Microsystems cofounder Bill Joy, Schmidt supports the notion that companies should hire &quot;divas.&quot; He elaborates, &quot;They are a pain in the ***. But the divas that believe will drive the culture.&quot;</p> <p><strong>On the APM program</strong></p> <p>Marissa Mayer, Schmidt says, contended that engineers should be hired immediately out of college, opting for graduates with technical degrees who didn&#39;t want to be programmers.</p> <p>&quot;She would train them -- take them on trips for weeks -- and it forged these incredibly tight bonds between people who were highly technical and could specify products.&quot;<br /> <br /> The APM program, it was called, along with other programs like it, led to the hiring of the present Google CEO Sundar Pichai, now-Dropbox CEO Dennis Woodside, and former Google operations executive Shona Brown.</p> <p><strong>On winning</strong></p> <p>Schmidt says, and this comes up a lot during the interview, that the reason Google has been so indefinitely successful in its comparatively short life is because it has a strong set of founders. Larry Page and Sergey Brin, he boasts, are both &quot;impressive, smart, passionate, [and] committed.&quot;</p> <p>&quot;The ideal business,&quot; Schmidt argues, &quot;is Microsoft -- a monopoly business with hardware competitors who need you, in a growing industry.&quot;</p> <p>You can read the full interview on <a href="">Medium</a>, courtesy of Chris Yeh.</p><p><a rel='alternate' href='' target='_blank'>Permalink to story.</a></p><p class='permalink'><a rel='alternate' href=''></a></p>[/parsehtml]
    Last edited by a moderator: Oct 20, 2015
  2. tonylukac

    tonylukac TS Evangelist Posts: 1,373   +69

    During my bout in silicone valley, I tried but was never able to set foot on stanford's campus; the whole thing seemed to have disappeared. Ate a lot of waffles at dennys in those days.
  3. Jamesbrah

    Jamesbrah TS Enthusiast Posts: 60   +12

    I recommend everyone to read the full article. Very interesting stuff.

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