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Thursday, March 16, 2006

The Love Machine

Last week Prabhakar and I presented some of Yahoo's past and future strategies to a bunch of Benchmark Capital portfolio companies at their recent shindig in Half Moon Bay. Prabhakar presented his compelling vision for Yahoo Research (which I've seen umpteen times before but excites me anew each time.) He also touted some excellent recent hires (including an exciting one that I’m sorry I can’t talk about because it's not announced yet.) He covered the joint Yahoo and O’Reilly developed Tech Buzz Game. This game is a “fantasy prediction market for high-tech products, concepts, and trends.” Very intriguing concept, worth checking out if you haven’t yet.



One of the highlights of the day was giving Philip Rosedale a ride home to San Francisco which gave us a solid 45 minutes to catch up. I’ve been friendly with Philip since he was CTO of RealNetworks (a long time ago) and have stayed in touch and watched as he and team have developed SecondLife. What’s happening in SecondLife is mind-blowing and almost too much to get my head around. I'll take every chance I can get to talk to Philip and glean what insight I might from someone who is literally a "pioneer in cyberspace." (I'm quite deliberately using this vintage '96 colloquialism cuz it fits so damn well. Forgive me.)

Once we were cruising up Highway 92 back toward civilization, I asked Philip what ground-breaking unconventional management techniques he applied at Linden Lab (makers of SecondLife) certain this would be be good fodder for the ride... I wasn't disappointed and he told me about a few…

The first is “The Love Machine.” The Love Machine is a simple way for Linden employees to give and receive “love”… where “love” in this context is work-related appreciation. It’s a page on their intranet with three fields, “From”, “To”, and “Why” (an 80-character free text field.) That’s pretty much it. People can (and do) give “love” to each other. It’s a way of saying “attaboy” or “thanks” or “I noticed.” There’s visibility into all the love you’ve both given and received. What’s interesting about this is that “love” is not only a morale builder, and a way of getting peer feedback, but is directly tied to money. (Philip mentioned that given Linden’s stage as a company right now, this variable bonus is relatively small… but will grow as Linden grows.) Philip also talked about “Taskzilla”, a mod of Bugzilla that basically allows for transparency and collective prioritization around the company’s focus.

Against the backdrop of Prabhakar’s Tech Buzz Game, we talked about a scenario where employees acquired “whuffie” (or cred) within the company not because of a title, or a degree from a good school, or from their ability to schmooze with those that hold and confer the power, etc. but rather from empirical demonstration that they can make strategic decisions that are net beneficial for the company. Imagine upon entering the company, every employee is granted 1000 “shares” of decision currency. You can spend your currency by buying into (or out of) various corporate issues in an open marketplace (a la Taskzilla.) Decisions are forensically judged to be good or bad by the employee community itself, and dividends paid out to those that got it right. Imagine the hallway conversations:
  • “I went ‘all in’ for the broadcast.com acquisition, so I’m basically decision-bankrupt…” Or
  • “I made a killing by endorsing the Overture acquisition… I could basically single-handedly end the operations of Yahoo Germany if I wanted to...” the QA engineer said smugly.
Puh-lenty broken about the above scenario, and not suggesting this scheme would work, promoting it as viable, or any such thing. (I’m feeling increasingly required to make these disclaimers on this blog as I continue to get misinterpreted and quoted out of context.) As an example of the many, many ways such systems can unravel, check out Business 2.0's reference on how Microsoft's attempts to establish a "meritocracy" have devolved into a popularity contest. (Though note that the Microsoft system is not democratic and is closed-door... The hope is that cronyism can be at least partially mitigated through large sample sizes and more transparency.)

I once had a manager who said, "Plan for the day when the salaries of all the company's employees are found sitting on the printer. It's only a matter of time before it happens." Ironically, plan as one might, I'd guess that list is sure to piss off nearly everyone irrespective of how it's designed. It's also not clear that "minimizing employee angst" is the right objective function for this optimization anyways.

So I’m just saying... fun stuff to think about. A fun thought experiment... And interesting to contemplate how the next generation of enterprise software might allow for more and better metrics by which to acquire subjective measures of an employee's contribution. Right now, so much of this is anecdotal, tedious, and perfunctory. "It's review time people, so please fill out your self-assessment, your peer reviews, review your direct reports, etc. and submit by next Wednesday." Something like The Love Machine provides a perpetual feedback loop that is easy, fun, instantly gratifying... and meaningful (to a degree.) Note Philip doesn't base an employees entire salary on this data... just a small discretionary spiff. Love gets you icing, not cake. The Love Machine should be primarily a measurement tool and not have the quantum effect of changing the system it's measuring. Though you wouldn't want people gaming the system too much in order to acquire Love, if the Love Machine tipped the culture toward becoming more conscientious, more aware and connected to how one's contributions affected others, etc. - that's probably not a bad thing.

Tacit is an example of a company that's doing extremely cool social engineering within the enterprise. By installing a proxy next to your mail server, they passively monitor email traffic and can autogenerate a "yellow pages" for your company that can answer questions like "Who's our resident expert on sockets-based networking protocols?" Putting (for now) the huge privacy and policy issues aside, this is pretty friggin' cool. One of the things that's interesting about it is the implicit harvesting of this information (vs. requiring me to fill out a skills survey or profile.) "Expertise mining." An aside: I think Tacit is one of the coolest names for a company I've heard, partly because it captures so well what they're about. They've got a bunch of a-list investors (including Esther), but the company has been around a while and has yet to realize its potential. Hope they can put the pieces together and make it work. Their CEO David Gilmour is a seriously bright (and nice) guy.

Cameron innovated around this idea recently (and is threatening to do more on Hack Day) but sadly I can't say any more publicly.

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