I ask because earlier this month, Genentech found itself pipped to the top spot in Fortune magazine’s famous list of the Best Companies to Work For. Despite having what Fortune acknowledges as a fiercely loyal staff, everyone’s favorite Silicon Valley icon, Google, grabbed the number one slot. And in the process, it raised some questions about what makes a good place to work.

When it comes to creating an employee-friendly workplace, of course, Google is hard to beat. Every day, thousands of employees ride free of charge in limo buses to its Silicon Valley headquarters from pick up points around the Bay Area, taking advantage of onboard wifi, removing the stress of driving through heavy traffic, and doing their bit to reduce CO2 emissions. When they get there, they walk into a campus-style set-up, with pool tables, scooters to ride from building to building, and free laundry. They can take their pick of numerous cafeterias to eat breakfast, lunch and dinner free of charge – and we’re talking top notch grub here, not a UK service station fry-up or a Denny’s all-day breakfast. Most famously, their engineers get to work one day in five on their own pet projects, helping to maintain the culture of innovation that’s propelled Google to the top.

It’s not just Google that stresses these perks. Genentech offers a six week holiday to employees after six years’ service. Data storage company Network Appliance, which came sixth in the Fortune rankings, provides extra benefits for parents of special needs children and has a flexible working schedule that’s adopted by 95 percent of its staff. And even among smaller companies, the extras are important. Online printing company PrintingForLess.com, a 160-employee operation in Montana that’s won numerous business accolades, offers a range of benefits to its employees, from share options and onsite childcare to free office roaming rights for employees’ dogs.

No-one disputes how much of a pull these benefits are. Likewise, no-one will dispute the fact that companies like Google get a little something back when they turn employees’ commute time into a work opportunity, and provide such good sustenance that people never have to leave the building. But that’s only part of the story.

When I met Cori Gorman for lunch over the summer to discuss an article for gateway2investment, I asked what really got her out of bed in the morning during her ten years at Genentech. One of the things she pointed to was the fact that 25-35 percent of the time in research, you could do pretty much what you wanted. “Almost all the products on the market were originally 'underground' projects, developed through this kind of informal research,” she says. “That's how Herceptin was born - it was an underground project driven by two or three different people. You have to have people who are a little bit renegade to do underground projects - not people who only do things they're told.”

And why did she eventually quit to join a start-up? “A lot of us who had been there in the '80s still had an adventurous, risk-taking spirit – we wanted to take things to the next big horizon.”

That, at least, was an argument I found myself discussing in some detail this week during a conversation about handling reorganizations. It’s not my theory – it’s actually one of the arguments put forward several years ago by Michael Hammer in his book‘The Agenda’, which I’d coincidentally stumbled across a few weeks earlier during an unusually energetic office clear-out.

Hammer, you may recall, was the man who helped bring the concept of ‘business re-engineering’ to a less than grateful public in 1990, and thereby indirectly contributed to some of the more spectacular change management cock-ups of the next decade. To be fair, when I talked to him shortly after the book launch, Hammer argued that more companies he’s met actually succeeded in their re-engineering projects than failed. He also put much of the blame for the failures on people slapping a ‘business re-engineering’ label on any downsizing or technology project, when the whole concept was actually about radically changing the way companies do business from the ground-up. What he did concede, however, is that he put too much weight on the ‘radical’, and not enough on the process and the customer. And that’s where he’s subsequently shifted his focus.

In ’The Agenda’, Hammer discussed his 20/60/20 rule, which is based on the principle that in any change management exercise people fall into three broad camps. Twenty percent will embrace change and help drive it forward; another 20 percent will be adamantly opposed; and 60 percent will be scratching their heads wondering which way to jump (I paraphrase somewhat, but you get the idea). The mistake we all make is to focus our efforts on working with the enthusiasts while simultaneously trying to convince the 20 percent of skeptics. But as Hammer points out, the enthusiasts are already on board – and many of those who fight change can’t be convinced. So the real battle will be won or lost among the 60 percent who haven’t committed. “Save your energies for where they matter,” he concludes.

This philosophy doesn’t sit particularly well with people managers who’ve been brought up to believe in consensus, but its logic is pretty unassailable – and in some respects, it’s even a comfort. In every change management situation the critics tend to have the loudest voice; it’s something of a relief to think that in the long run, their opinion may not actually matter.

Over the holidays I caught up with Pat O’Kane, who for the last six months has been heading up leadership and organizational development at HBOS’ Insurance & Investment arm. The bank is pretty advanced in some of its Human Capital Management work in the UK, particularly in the way it carries out succession planning on the basis of job criticality rather than seniority (see Line of succession).

O’Kane mentioned that a big part of his focus in the second half of 2006 was on performance management, prompted by a review of the division’s new competency framework. The group’s core competencies – Lead, Shape, Build and Deliver – were introduced in his division at the end of 2005, and last July the team ran focus groups and questionnaires to see how helpful they’d been in managing performance. Given that the division’s appraisals affect employee pay and bonuses, there’s a wee bit of pressure on managers to do the job properly.

While the overall feedback was encouraging, O’Kane says it raised some important issues. Rather than setting up a series of training courses to tackle them, he got board buy-in to take the unusual step of offering all 700 line managers one-to-one meetings. To date, 500 of them have spent an hour with one of O’Kane’s team members, discussing whatever performance management issues weigh on their minds.

These discussions serve as a reminder that it’s the practicalities that ultimately make or break performance appraisals. Some managers struggle to set objectives, for example, getting distracted by the process or the intricacies of the documentation. One or two need advice on how to deal with problem members of staff, particularly if it’s the first time they’ve formally appraised them and they don’t want poor performance to go unmentioned. Whatever their concern, the idea of sitting down in front of a support team to talk things through got an overwhelmingly positive response.

If you’re thinking to yourself that 700 hours is a lot of time for O’Kane’s department to set aside, you’re right. But look it at it the other way: one hour is time well spent for each line manager to get their organizational development plans on track.

Everyone who’s gone through the hiring process will be familiar with the nagging fear that somewhere, buried beneath clumsy prose and absurdly detailed descriptions of irrelevant projects, is the candidate of your dreams. Sure, if you’re hiring someone for a communications or marketing job, you expect them to be able to sell themselves in writing. But if you want a talented software engineer or someone to rewire your building, you don’t expect Pulitzer prize-winning prose. So how do you find them?

This week’s New York Times carried an article on Google’s efforts to automate part of the filtering process. Last summer it asked its employees to fill out a 300-question survey about themselves, covering everything from technical knowledge to behavior, personality and their pets. The feedback was cross-referenced with performance metrics on each respondent to get a rounder picture of what makes a good Googler. The findings have helped it develop surveys that job applicants will now be taking when they apply for roles in a number of business areas, including engineering, HR and finance. The idea is that Google, which is renowned for its obsession with candidates’ academic performance, will be able to look for other factors that may help it identify the right people.

The story reminds me of a conversation I had a few weeks ago with Jeff Benrey, co-founder and CEO of US vendor Trovix. It’s a pioneer in the ‘Office 2.0’ arena, the new breed of companies that provide software as an online service rather than something you buy and install on your own systems (see Q&A: Software as a Service). And it’s developed an applicant tracking system that filters CVs with some pretty sophisticated search technology.