Laszlo Bock is one of the most famous heads of Human Resources ever. Part of this is that he lead HR at Google, and he initiated a number of innovative practices, many of which were captured in his book, Work Rules!: Insights from Inside Google That Will Transform How You Live and Lead.
Part of the reason why other HR execs have not become household names is that companies do not think of HR as being as strategic as they should, and therefore the Chief Human Resources Officer is not on an equal footing with the other “chiefs.”
Two and a half years ago, Bock co-founded a company, Humu, that helps CHROs among other executives ensure that teams are as productive and as happy as possible. He has leveraged his experience at Google and GE before that along with the work of prominent academics to develop what Humu refers to as “nudges” or reminders, timed at just the right time to impact behaviors in a positive fashion. Bock describes the genesis of Humu, the technology behind these nudges, and the impact he intends make at companies large and small as a result of Humu. Ultimately, he believes that we are on the cusp of a revolution in human resources akin to the operations and manufacturing revolutions of a century ago.
Peter High: Laszlo Bock, a little over two years ago, you founded an organization called Humu after nearly 11 years as the Senior Vice President of People Operations at Google. Currently, you are the CEO of Humu. As your site says, the company drives “behavioral change with the power of people, science, machine learning, and love.” Please describe the business.
Laszlo Bock: Our fundamental belief is that people are intensely complicated. Whether it is a small organization or an enterprise with hundreds of thousands of employees, it is difficult to expect a manager to know exactly the correct actions to take and precisely when to implement them to make their team effective. Similarly, as an individual in a large organization, it is difficult to know what is going to move the company forward and what is going to make oneself happiest from day-to-day.
Humu is a behavioral change technology company. We help organizations transform their scale using nudges. These nudges are based on people, science, machine learning, and a little bit of love, but the underlying idea is that we believe in empowered work. There is too much conversation about engaging and exciting employees. We believe that we need to empower individuals, empower teams, and put the individual at the center of efforts to drive company performance and employee happiness. That is what we do.
Peter High: How do the nudges that you referred to work?
Laszlo Bock: We develop nudges by focusing on metrics that matter. We determine what actions will matter most when driving five factors: organizational performance, retention, individual happiness, inclusion, and innovation. We calculate which behaviors each person needs to change to maximize those factors for themselves, the team, and the organization. Then, we send AI-driven nudges. These include small reminders and notes. They can go by email, text message, Slack, Yammer, or however people communicate. Nudges show up at just the right time to help people be a little bit better, try something new, or make their environment a little more inclusive. The result is that people take action on the things they ought to do about 250% more frequently than when they do not receive these reminders. There are massive improvements in productivity, and people are happier.
Peter High: What was the genesis of the idea? How did the ideas occur to you for both the factors that the nudges facilitate and the process for combining the technology and interpersonal methods?
Laszlo Bock: It was not just me. I have two amazing co-founders: Wayne Crosby, who is a technical genius and an amazing people leader, and Dr. Jessica Wisdom, who runs people science for us. Her original work when she [worked on] her Ph.D. at Carnegie Mellon surrounded how people can make better food and nutrition decisions. It was a team effort coming up with our idea, but the genesis had two points. One is that work is pretty miserable for most people. There are four billion people on the planet, and for most of them, work is just a means to an end. It is a grind. Individuals are not treated nor thought of well. There has got to be a way to make work better, we believed. There has got to be a better answer.
The second point is that I have been fortunate enough to work at some pretty large companies. One was General Electric [GE], which was renowned for its leadership and people development practices. I was at Google for a long time, and I helped shape and build that company.
I realized that if you want to drive performance and happiness at scale, there are only a few mechanisms. One is to a leadership academy such as GE’s Crotonville. However, it is fabulously expensive and tends not to work overtime with significant leadership and investment changes. The second option is to invest in training and coaching. If 10% of a company are coaches, people will get a lot better, but this is extremely expensive. The third mechanism is to seek a technology solution.
There must be a way to do this, we thought. Behavioral science had evolved enough. We had been able to push it quite a bit in my old job. We benefited from scholars such as Richard Thaler and Cass Sunstein, who coined the phrase “nudge,” and folks like Adam Grant at the Wharton School of the University of Pennsylvania, who has helped us. We realized that there is a technology solution to help people be more aware of how they can learn, grow, and make the experience of work better. That is where the idea of nudging people came from.
Peter High: Can you give some examples of how your organization is using these nudges internally?
Laszlo Bock: We use our Humu Survey internally. The product works through a primary diagnostic through which we take in various sources of data. Some of it looks and feels like an employee survey, but we also look at productivity data and retention data. It is highly customized for each organization.
We then report out. First, we crunch the numbers and decide what matters the most. Second, the results get shared. We strongly believe in transparency. If people know what is going on around them, they will perform better and be more committed. There are conversations about the results, and then our Nudge Engine, which is the set of algorithms that powers our nudges, starts tying off nudges inside the company. For example, I received one this week regarding making sure I provide constructive feedback to people on the team because I am a manager at our company. In the following days, I checked in with two different people, asking them how they are doing and giving them specific, constructive feedback based on things that had happened that week or the week before. I did this because I was reminded that these conversations are what matter most to the people around me. The nudges tell me that out of all the different management practices I could employ, this is what I should be choosing. It is beautiful to receive immediate feedback. My employees will say, “That was helpful. Thank you. I had not thought about that.” They recieve nudges to ask me for feedback, as well. Together, we move the company forward.
Peter High: Who were the early adopters of this? Which function within companies tends to be the target executives?
Laszlo Bock: We deliberately focused on large companies. We have been working with a large tech company that had an infamously bad culture which has since turned around. We generally do not share the names of the companies that we work with, though some we may speak of publicly with their permission. One is Sweetgreen, who was a customer early on. Another is Fidelity, which is more typical of the kind of organizations we work with. With 50,000 people, it is a great company with nothing wrong nor broken. Their questions were, “How do we take it to the next level? How do we become more innovative and inclusive? How do we make a great company even greater?” This is typical of the company profile we work with. We work with large companies that either are great and want to get better, as in Fidelity’s case, or organizations that desire transformation.
Peter High: Why the focus on larger organizations? By definition, I imagine that means erring on the side of digital immigrant companies as opposed to digital native companies.
Laszlo Bock: Correct. The focus on larger companies is two-fold. On one side, we want to affect as many people as possible and do as much good as we can, so we have started with larger organizations. Another example is Teach For America, which is a customer of ours. It is a large organization in an important space, so we are having an impact.
On the other hand, one of the traps that HR technology companies fall into is getting lots of small startups to try the product. They are welcoming because, as they say, “If you scratch my back, I will scratch yours.” Additionally, it is easy to find many individual users to try a premium model when you ask them to bring it to their team. The problem with starting with small companies in the technology industry is that they are extremely homogeneous, not just in terms of diversity but in terms of job type. A data set will be built that does not apply to most of humanity. Serving the most people requires working with the widest variety of people.
Regarding where our partners come from, it has been almost entirely inbound thus far. About two-thirds are from the Chief Human Resources Officer. About one-third has been from either the CIO, the CTO, the COO and sometimes the CEO. It is interesting that some of our largest partners have come from companies that are doing a digital transformation and then say, “We have new technology. Now, we need to teach 80,000 or 20,000 or 10,000 people how to use it and how to think in a more agile, creative, and transformational way.” We get quite a bit of activity from the IT and technology sides of companies.
Peter High: You had a long and illustrious tenure at Google. What did you draw from that experience in forming your own company? What new aspects have you brought to this culture?
Laszlo Bock: We have tried to take the best of what we had there and pour it over. When I was at Google, the culture was acutely rooted in mission, transparency, and voice. Here at Humu, we talk about related terms such as being transparent, giving different people voice, and empowering employees. We have tried to push these themes and evolve them. Having a voice and speaking up is great, but empowerment is much more powerful. Empowerment is when everyone feels like an owner and is an active participant in how we make decisions at the company.
Furthermore, we have pushed further and taken stronger positions on issues. It has been great to be able to weigh in on topics such as sexual harassment. My strong view is that if there is a whiff of bad behavior, the person is fired. As it is our own company, we have the freedom to make those types of decisions and weigh in more vocally. It has been wonderful to build incredible diversity and breath into the company from scratch.
Conversely, it is a lot more responsibility. Even though I had a big executive job there, Google has been fine since I left, and Google was fine before I got there. Here, my co-founders and I feel a tremendous responsibility to make sure the individuals at our organization are cared for and to make sure the people we serve gain better work experiences. It is important that we make work better, and it is too easy to inadvertently make it worse using technology.
Peter High: You led a function in HR at Google that is not necessarily deemed as strategic as it should be in a lot of organizations. Oftentimes, HR is thought of as a support organization when, in fact, the work that HR teams do is arguably the most important. It involves bringing in new people, evaluating the talents of those that are already there, and providing the mechanisms to continue to motivate great people to stay for the long term. You are one of a small number of famous CHROs. You wrote a fantastic book on work rules and took incredibly innovative steps as a CHRO at a company such as Google. Please reflect on the evolution of HR and where you see it going.
Laszlo Bock: I believe that HR is poised to have the same revolution that operations and manufacturing had 100 years ago with Frederick Taylor. It will be the revolution that marketing had with Time, Inc. and targeted marketing in the ’70s and with digital advertising in the Google and Facebook era. This is an opportunity to bring analytics, statistics, and computer science into the HR field. Companies are dipping their toes into the products of startup companies with these features.
The idea is fraught with peril because there is a lot of vaporware and misrepresentation. One must be thoughtful in ensuring that partners are backed by real science, real computer science, and strong data privacy. There are many pitfalls, but that is the opportunity. Stepping back a level, it becomes apparent that two of the biggest spend categories for corporations today are technology and people. Technology is pretty well-instrumented. A lot has been documented on how to make technology more efficient and valuable.
People are not as well-instrumented. One finding that is exciting us at Humu is that it is possible to build an early warning system for organizational culture. Performance and behavior can be driven across a company. By applying the right technology, massive transformations in how people are feeling can occur, which in turn, transforms how they perform, how long they stick around, and how included they feel. That is the opportunity.
Stemming from Google, we built People Analytics, which brings science to the work we do. We are now creating its next evolution from the union of the cutting-edge science that I wrote about in Work Rules! and the best computer science and machine learning on the planet. It is backed by a tremendous sense of ethics, privacy, and dedication to treating people right. Bringing all of these factors together is a big opportunity in the HR space. It does not have to be done with my company. There are lots of great ways to do it, but that would be what I would hope and expect to see evolving over the next five to 10 years in the field.
Peter High: You were born in Romania and immigrated to the United States. You are part of an enormous club of Silicon Valley founders who were born outside of the US. The immigrant’s journey is fundamentally entrepreneurial in terms of taking a risk with optimism, a fact that is important and often lost in conversation, especially among those who have a fear of immigration. I wonder if you can reflect on this as somebody who has walked both journeys, as an immigrant as well as an entrepreneur.
Laszlo Bock: I appreciate the question. I was born in communist Romania. My dad was born in 1941, and his first memory was a hearing on the radio station Voice of America, “The Americans are coming, the Americans are coming.” The idea of America has always been incredibly powerful in my family’s life, and, I believe, in the lives of everyone around the world. This country stands for something. It stands for freedom of the press, freedom of association, individual liberty, and a better way of thinking about the human condition. People who come to this country come for that.
I know somebody who is a housekeeper. She came to the United States from Guatemala. She left because she was a principal and her husband was murdered. She feared for her life. She took her kids and came to the United States and applied for refugee status.
I talked to an Uber driver who is from Iran. He came to the United States because he was fleeing persecution, and he had an incredible story about the house his family lived in that was bombed and destroyed. Uber was a way for him to make a buck as he pursued a degree in architecture.
To leave everything behind wherever you come from, whether as a refugee or just to try to find work, is a tremendous act of courage. It is extremely hard. Just imagine saying, “Okay. I am not going to talk to anybody I grew up with. I am going to leave my network behind. I am going to move someplace where I do not speak the language at all, and I am going to try to find a way to make it.” The idea this country stands for and the drive that immigrants have to make a better life, build something, and better themselves are big reasons why there are so many Silicon Valley companies, and other companies, founded by immigrants. Lots of people can and should start companies, but the people who have immigrated here are legally pre-screened based on what they are putting themselves through. They are a pre-screened set of people who are driven, entrepreneurial, and want to build something. It breaks my heart when I see that segment of people disparaged.
It is an incredible source of inspiration to see trillions of dollars of value and hundreds of thousands of jobs that have been created by the folks who were here before me. If I am lucky and blessed enough, I will be able to follow in the footsteps of my dad, who started a company, and my mom, who started a company and employed lots of people. Hopefully, I will do a little good along the way.