Google Could Put Over 10,000 On Notice With Its New Rating System
Google reportedly announced the new rating system this past May.
In this economy, tech has been shedding jobs at a breathtaking pace — and a new system of performance reviews at Google is evoking a similar spirit.
Though the tech giant has avoided layoffs so far this year, unlike Meta, Twitter, and Amazon, it has reportedly introduced a new way of rating employee performance, according to Insider and The Information.
In May, Google announced a new way of reviewing the performances of its employees, per The Information. It's called GRAD, which stands for "Googler Reviews and Development."
Its structure calls for managers to categorize a larger percentage of their teams as bad apples, Insider reported, per internal documents. Previously, that number was 2%.
Now, it's 6%.
Parent company Alphabet, of Google and YouTube, clocked in at 186,779 employees in its most recent earnings report. With the new percentages, over 10,000 people could get labeled as low performers.
Like many other companies in its sector, the pandemic acted as a sort of sugar high for the industry and drove break-neck hiring. Google added over 40,000 employees from March 2020 to March 2022.
Sir Christopher Hohn of A London-based hedge fund, TCI, which is a significant investor in Google, wrote to Alphabet and said: "The company has too many employees and the cost per employee is too high."
"Management needs to take aggressive action," the letter added.
Under Google's new performance review system, being a low performer now includes being in the bottom two categories, not just one, Insider noted. The penultimate category is "moderate impact" meaning the person "was not consistently at the level/standards expected," in their position.
If a Google manager wants to put you in either bottom two, they have to meet with you in a "support check-in" which has increased of late. Managers also now have minimum numbers of these to conduct.
"Performance plans are the next step if folks don't respond to the check-ins," a source told the outlet.
Google told Entrepreneur via email: "Earlier this year, we launched Googler Reviews and Development (GRAD) to help employee development, coaching, learning and career progression throughout the year. The new system helps establish clear expectations and provide employees with regular feedback on their performance."
It's unclear if this could lead to layoffs of low performers.
Entrepreneur Editors' Picks
How an Encounter With the 'Armpit of Destiny' Helped the Founder of Grubhub Take His Business From His Apartment to a $2 Billion IPO
You Can Train Your Brain to React to Stressful Situations Better. Here's the 3-Step Process.
A Disastrous Valentine's Day Inspired This Founder to Launch Her Own Floral Brand. It Became a Celebrity Magnet With Retail Revenue Up 450% Since 2019.
What Is Your Dream Job? Ask Yourself These 4 Questions to Find Out.
This Is the Crazy Process This Juice Franchise Went Through to Get USDA-Certified Organic. But It Sure Has Paid Off.
No One Would Rent Me a Café in Trendy NYC Neighborhoods, So I Tried Something Risky. Now I Have 3 Coffee Shops.