Entrepreneurs

Google CEO Addresses Employees on ‘Aggressive’ Cost-Cutting

Google‘s CEO is doubling down on the company’s decision to “increase efficiency” and cut costs — and he’s less than thrilled about the way employees are handling the news.



Jerod Harris/Getty Images for Vox Media

Jerod Harris/Getty Images for Vox Media

Sundar Pichai recently spoke to employees at a company-wide Town Hall meeting where he addressed questions that employees had fielded through Google’s “Simplicity Sprint,” an initiative in which employees were surveyed on three questions on how Google could eliminate waste and improve efficiency internally.

One harsh question asked of Pichaiwas why the company is “nickel and diming” employees and “aggressively” cutting costs despite Google’s “record profits,” according to an audio recording of the meeting obtained by CNBC.

“The fact that you know, we are being a bit more responsible through one of the toughest macroeconomic conditions underway in the past decade, I think it’s important that as a company, we pull together to get through moments like this,” Pichai told employees. “We’re committed to taking care of our employees. I think we’re just working through a tough moment macroeconomically and I think it’s important we as a company align and work together.”

One particular area of employee angst is the “aggressive cost-cutting” surrounding travel and entertainment expenses.

Google execs have asked employees to refrain from going “over the top” with holiday parties and other celebrations.

“I remember when Google was small and scrappy,” Pichai said of cost cuts on employee perks and in-office entertainment. “Fun didn’t always — we shouldn’t always equate fun with money. I think you can walk into a hard-working startup and people may be having fun and it shouldn’t always equate to money.”

Google missed on Q2 2022 earnings and revenue as reported in July, something Pichai has adamantly accredited to unchangeable macroeconomic conditions that have affected virtually every major industry, like inflation and the potential of a looming recession.

“The more we try to understand the macroeconomic, we feel very uncertain about it,” Pichai said earlier this month during the Tech Code conference in Los Angeles. “We want to make sure as a company when you have fewer resources than before, you are prioritizing all the right things to be working on and your employees are really productive that they can actually have impact on the things they’re working on so that’s what we are spending our time on.”

Google’s parent company, Alphabet, was down just over 30% in a one-year period as of Monday afternoon.

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