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Thursday, 26th February 2009

California Dreamin'

James Forsyth 12:50pm

Fraser’s piece in the magazine this week on how California is inspiring the Tories is well worth reading. Fraser makes the point that the Tories are attracted to California because family friendly policies and dynamic businesses go together there. The important thing to appreciate is that these businesses are family friendly not because of regulation but because this is the way to attract the best talent and thus to maximise the company’s profitability.

On one trip to California a couple of years back to visit a friend who was at Stanford business school, I was struck by how Google was regarded as the place to work by the student there not because it offered better salary or stock options but because of the maternity and paternity leave and childcare options it offered.

In the next economy, creative talent will be one of the main drivers of a company’s success and profitability. This means that companies at the top of the value-chain are going to move towards more and more family-friendly policies because of the edge that gives them in recruiting the best employees. This is going to have a knock-on effect on other companies.

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Wily Trout

February 26th, 2009 1:00pm Report this comment

I thought 'California' had just gone bust ...?

THX1138

February 26th, 2009 1:07pm Report this comment

Well Steve Hilton's wife Rachel Whetstone is head of PR at Google. In the new model Conservative Party Steve works from home in Palo Alto, across the time zones & takes paternity leave this is exactly why a norf LDN librul like me will be voting Tory at the GE.

I bet 99% of Google employees & Palo Alto citizens in general voted for Obama. These uber smart, well connected, rich opinion formers will never vote for a Republican party that decries science & thinks it's stupid to monitor volcanoes.

THX1138

February 26th, 2009 1:25pm Report this comment

Doh- I just read Fraser's article, makes my points about Steve Hilton & Rachel Whetstone that'll teach me to fire off a comment without reading the article first.

Still It's funny that a centerist librul like me is much closer to the thinking of the new Tory high command than all the old Skool Tories commenting on this blog.

Wily Trout- Republican Governor, that'll be the problem.

True Bred Pomponian

February 26th, 2009 1:53pm Report this comment

Hmm, Google is making monumental amounts of money from an original basic idea and, consequently, can easily afford family friendly policies. How many small businesses can afford to do likewise?

Sally Chatterjee

February 26th, 2009 1:55pm Report this comment

Nice things but they apply to an elite of the world's workers. Californian working practices will never make it to a supermarket in Rotherham or a paint factory in Pinner.

James

February 26th, 2009 1:57pm Report this comment

One problem is that this works best with a high-margin business that relies on technical innovation to retain market share.

Family-friendly policies are costly and are less likely to work in more mature, competitive low-margin businesses. For instance this sort of policy is the last thing that Ford or GM should introduce - they are fighting to survive and need to cut their cost base dramatically.

It also doesn't work well in businesses that rely on personal relationships (sales or banking). Whether you like it or not - if you aren't there to service a client - someone else will.

Terra firma

February 26th, 2009 1:58pm Report this comment

THX1138 - there is a difference between decrying science and being wary of the potential for science to be abused by those who would attempt to play God.

Just because conservative politicians object to the creation of human-animal hybrid embryos (for instance) doesn't mean they are Luddites - merely that they prefer humility and circumspection when confronted with a head-long race to create some kind of 'brave new world'.

fulcanelli

February 26th, 2009 2:11pm Report this comment

California, with the exception of the state finances etc, is certainly not a bad model to study and emulate.

The next wave of business and growth will inevitably come from creative media and its associated talent. Manufacturing is lost in a race to the bottom, so why not aim for the creative market.

Patrick

February 26th, 2009 2:24pm Report this comment

People are leaving California in droves because it has a truly awful anti-business ethic and punitive tax rates. It spends way more than it can earn and is ungovernable.

Emulating California for good governance models is like emulating Hugh Heffner on how to live a chaste life.

THX1138

February 26th, 2009 2:39pm Report this comment

Terra firma makes my point for me.

Patrick yep and their taking their Democratic politics with them, that's why Colorado went blue this cycle.

KB

February 26th, 2009 2:53pm Report this comment

This sounds like garbage. Anyone got any figures? I have. 41% of German women graduates are childless (more accurately: have a completed fertility of 0), and the figure for the UK is predicted to be around 30%. I would guess the figure for the US is in the same ballpark.

Therefore, family-friendly workplaces would seem to be of minor import, especially in the "knowledge-based economy". Unless, of course, by family friendly one means being allowed to bring the dog to work and to take off surfing one day a week.

Andrew Cadman

February 26th, 2009 9:12pm Report this comment

Some good ideas but all a bit California dreamin' to me. It looks like Dave is going back to his 'aroma' days. Might go down well in cool Notting Hill but a bit rarified for the rest of us.

I also agree with Patrick - for years California has sufferred a huge 'white flight' due to immigration and high taxes....and dont confuse the dynamism of Silicon Valley and the laid back style of San Francisco with California as a whole. Ever been to Los Angeles? A worse city can hardly be imagined.

Lastly I instinctively dislike politicians thinking they can mold people or society into something else. Do we want to be Californian? There are certainly worse fates but it is rather arrogant. Tories should trust their libertarian instincts and in the main concentrate on setting the people free, make them responsible for their own actions while trying to help the vunerable.

porkbelly

February 26th, 2009 9:42pm Report this comment

This article is without question one of the most preposterous pieces of drivel I have read recently. Where to begin...It seems whenever someone travels from grey, gloomy England to "sunny California" (or some such shopworn cliche from the lazy writer's suitcase) their brain gets left at home. California is probably the most anti-business state in the nation. It combines a hostile bureaucracy with a crushing tax burden (just raised again, by the way) and impenetrable rules and regulations. And it only keeps getting worse with all these ridiculous "green" rules that do little or nothing for the environment but much for the state's coffers. Google couldn't be less representative of real-world California business - and by the way most of those quirky-named Internet firms lose money hand-over-fist. They are built on pure hype designed to only enrich the owners when they go public or sell out. Tesla anyone? Meanwhile ordinary dull businesses like dry cleaners, florists, plumbers and so on (you know - the ones that actually make things people can use) have to struggle to eke out a profit. Just how are they supposed to pay for maternity leave or lactation coaches or electric car charging stations or any other feel-good bosh that some sunstroked politician dreams up? Do you think they can afford to work flexible hours for the sake of their families? Despite what the author thinks no-one works more hours than Californians - we have to! An while we slave away to afford the "good life" all the while the public sector grows like a tumor, sucking the economy dry for the sake of the mighty public employees' unions, aided and abetted by a thoroughly corrupt and inept state government. We also have one of the worst public education systems in the country, a massive illegal immigration problem...if this is the vision British Conservatives are offering for the future God help you all. You might as well keep Brown - at least he's entertainingly loathsome.

London Calling

February 26th, 2009 10:28pm Report this comment

Who needs to dream when you have a Helter Skelter in your workeplace ... This is England
so lets get creative, just need another slide down to the creche for mums and dads...

http://www.dailymail.co.uk/news/article-1156292/Pictured-Britains-indoor-office-helter-skelter-sees-s

Old Hack

February 27th, 2009 5:44am Report this comment

There is nothing commendable about the state of California's deficit spending.
Nor its immigration issues.
Nor its silly system of plebiscites that spark ridiculous squabbles.
Nor its urban sprawl.
Nor its value system of which Google's corporate culture is just one small part.
No, the only thing perhaps worth importing is the weather.
As for Google, well life is fine if you work for them but frankly there are enlightened companies here in the UK, why go to Cali?

Johnathan Pearce

February 27th, 2009 8:35am Report this comment

For a while, the political culture of California, both the northern, Silicon Valley/Napa/San Francisco and the southern, Hollywood bit, has been libertarian: or to put it in US politicsspeak: conservative on economics, liberal on social issues.

More recently, as the near-bankruptcy of the state shows, the culture of the state has become socialist. Spending is out of control; the Green movement has stymied developments such as new electrric power plants. Many of its best entrepreneurs are fleeing to nearby Nevada, or further afield. California has an economy the size of France and is exhibiting France-like dirigisme.

I would urge the Tories to draw the right conclusions from this state, not to get too dazzled by the admittedly superb economic success of Google and the tecchies.

FrancisT

February 27th, 2009 11:53am Report this comment

It is of course important to note that Silicon Valley is a minor part of the state of California. Perhaps 5% of population and area (depending on what you measure). SV may be relatively entrepreneurial, livertarian, green, family friendly etc. but the rest of the state isn't.

California also includes the intensive agriculture of the inland valleys (neither green with their irrigation practices nor family friendly given their employment of semi-legal mexicans). Then there's LA. A sprawling mess of a city that appears to be gradually hollowing out as companies and middle class workers up sticks for other places. And so on. Even in Silicon Valley it's not all Google. I don't think companies like Intel are nearly as generous to their employees and I'm even more sure that the startups are distinctly family unfriendly since they expect their employees to put in 60+ hour weeks.

Oh and Cambridge has to some extent replicated Silicon Valley and to some success. ARM, CSR, Autonomy are just three large IT companies that have sprung from Silicon Fen.

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