Thursday, May 29, 2008

Hiring your way to Total World Domination

In the early 1990s, Microsoft had its pick of college graduates; five years earlier, it was Apple, and of course in the 60s it was IBM. Fortune magazine has surveyed MBA students as to where they’d like to work, and the number one choice was Google (24%).

For a company based on innovation, technology development and creativity, you’re only as good as your people (and your management). Google has been hiring the best engineers for years, and (has been amply demonstrated recently) has much better management than Yahoo (and also got some help from its older Stanford cousin). Continuing to attract the best people in the world is certainly one key to remaining on the path to Total World Domination.

However, all good things must come to an end. Microsoft got less attractive when dot-coms looked more exciting and lucrative and then later when its stock collapsed (and then stagnated), making stock options useless as a recruiting and retention mechanism.

In the last year, Google’s stock began to follow Microsoft’s pattern (off 22% from its 52 week high), reducing its potential as a motivation tool. This could be followed by other problems common to once high-flyers. If it doesn’t have high internal growth (as opposed to growth through acquisition), there will be limited opportunities for internal career growth — although with Google’s broad span of control, the opportunities for advancing up the management chain for latecomers were always lower than at a traditional company.

On Fortune’s list, six of the top 10 were investment banks or consulting companies; the only other tech company was Apple, fourth at 14%. Among IT companies, Microsoft is #12 on the latest list, and IBM #29 — both ahead of Cisco (#43), Intel (#44), Dell (#63), HP (#64) and Nokia (#81). The surviving dot-coms do a little better, with Amazon (#23), Yahoo (#32) and eBay (#53).

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