One of Google’s most famous perks is the ‘20% rule’, in which staff are allowed a portion of time to work on their own projects. However as Eric Schmidt and his co-author explain in How Google Works, this isn’t a matter of time as such. From loc 3210:
This is the power of 20 percent time, 181 the Google program whereby engineers can spend 20 percent of their time working on whatever they choose. Twenty percent time has spawned a host of great products—Google Now, Google News, transit information on Google Maps, and many more—but it is generally misunderstood. It’s not about time, it’s about freedom. 182 The program doesn’t mean that the campus turns into summer camp every Friday, with all the engineers goofing off in (hopefully) creative ways. In fact, 20 percent time is more like 120 percent time, since it often occurs on nights and weekends. But it can also be stored up and used all at once—Jonathan had one product manager take a summer to work on a 20 percent project. Regardless of when you take your 20 percent time, assuming it doesn’t get in the way of doing your regular job, no one can stop you from doing it. Twenty percent time is a check and balance on imperial managers, a way to give people permission to work on stuff they aren’t supposed to work on. It helps bring to life the Steve Jobs maxim that “you have to be run by ideas, not hierarchy.” 183 And we have found that when you trust people with freedom, they generally do not waste it on extravagant pies in the sky. You don’t get software engineers writing operas—they write code.
This could be reframed as a strategy to maximally extract value from human capital: expecting staff to pursue projects, on their own initiative and in their own time, which are owned by the corporation.
An interesting empirical question: what’s it like to be someone at Google who doesn’t want to do this? Are such people filtered out during the hiring process? If not, are there sanctions for non-compliance? For just wanting to do your job as its presented to you?
Later in the book I found this paragraph, loc 3408:
While we believe in paying extraordinary people extraordinarily well for extraordinary success, we don’t pay people for successful 20 percent projects. Dan Ratner may have received very generous compensation for being part of the transformational Street View product team, but he didn’t get anything directly tied to his work on trikes. 197 We don’t provide any monetary incentive for 20 percent projects for the simple reason that we don’t need to: It may sound corny, but the reward comes from the work itself. Several studies have shown that extrinsic rewards don’t encourage creativity, and in fact hinder it, by turning an inherently rewarding endeavor into a money-earning chore
Mark Carrigan 