
Valve Employee Handbook - v21
http://cdn.flamehaus.com/Valve_Handbook_LowRes.pdf
======
molf
This sounds a lot like a "lattice" organisation. It was invented by Bill Gore,
founder of W.L. Gore & Associates (famous for their Gore-Tex fabric). At Gore,
apparently everyone is an associate with no specific job title. There are no
chains of command or hierarchy. People choose to work on projects based on
their own judgement.

As Gore grew, it was apparent that this structure did not work with more than
a couple of hundred people. So now, teams are limited to about 200 people
(approximately Dunbar's number). I imagine Valve will run into this social
limit as well once they grow well beyond their current 260 employees.

Given that Gore still exists, has 9000 employees and is profitable after 60
years is testament that such a structure can work for small as well as larger
organisations over a longer period of time.

I first learned about this organisational structure in Malcolm Gladwell's book
The Tipping Point. There are multiple descriptions online, here's one that
seems interesting:
[http://ecgi.ssrn.com/delivery.php?ID=61902009302412510712411...](http://ecgi.ssrn.com/delivery.php?ID=619020093024125107124111019099119123070005063047062066086085064045007008026071062033009127053113030117126090013072022059045025126101104000112025068069094&EXT=pdf)

~~~
arkitaip
I've spent the last hour reading about W. L. Gore and Associates and the
lattice organization and it's been very inspiring. Thank you for this.

------
kator
Funny but true I interviewed and was given an offer but the pay was so far off
what I was earning "at market" that I ended up not going to work for them.

The interview process was amazing, took 6 hours at a white board, multiple
teams drilled me on all the various languages I claimed to know and then some
business teams grilled me on my thoughts about the industry.

The passionate side of me really wanted to work for them but the pragmatic
side of me made it clear I would have to work for considerably less than I was
making open market. To make things worse my next position literally was almost
double the salary Valve offered me.

I was just last night joking with my wife that when I want to settle down
maybe I should try and go back through the process with the understanding it
will most likely be 1/3 of my current salary.

I love working in my passion but as I always tell people the people at the
grocery store still want me to pay for my food.

I try to balance passion and pragmatism and if I need some crazy passionate
project I take on a side project on the weekends for some open source project
etc.

~~~
matwood
I think you made the right choice unless taking 1/2 the salary for a couple
years would have been a stepping stone to your own game company. I hate the
'passion' term because it's often the term thrown around by owners looking for
employees. Of course the owners are passionate since they stand to gain a lot
of money from the companies success.

I will passionately bust my ass for 12 hour days if I'm paid properly.

~~~
james33
Well some people belong at a startup, and then there are some people like you
who clearly don't. Life shouldn't be all about the money, sorry to break it to
you.

~~~
matwood
So people should go be employees somewhere at 1/2 pay and bust their ass so
the owners can sell and never have to worry about money again? Life can stop
being about money, when everything required to live stop costing money. Food,
shelter, education, healthcare all require money. Want to have kids, money.
Want to travel and see the world, yep that also cost money.

Startups are exciting and fun, but their success is gauged by a single metric
- money. When startups get acquired there are endless congratulations on this
very site. And rightly so, the owners should be rewarded for their work.

In the end I guess you're right. I don't belong at a startup as an employee
making 1/2 my salary. I either need adequate pay and/or an equity stake to
work at one.

~~~
CubicleNinjas
If you're focused on the inequalities of a business' income structure, you'll
surely be disappointed by them all.

------
rheide
This has the single best description of a team lead I have ever seen:

"[Team leads are] keeping the whole project in their head at once so that
people can use them as a resource to check decisions against"

~~~
gruseom
I agree. The whole paragraph, in fact, is the best description of that thing
I've ever read.

There are more than a few things in here which, if true, turn common ideas
about management on their head (or rather just shoot them in the head). What's
exciting is that they reflect how _work actually gets done_. Shouldn't that be
our organizing principle?

I think what makes startups so effective is that they naturally work this way
at first. But then, typically, bad ideas about how one is supposed to "manage"
and "scale" kick in and stifle the thing. This document is interesting as a
conscious strategy for not being stifled. Valve's success lends it
credibility, and the fact that Valve is not a startup makes it more
interesting, not less, because it's so unusual.

------
sgentle
Hm. So is this a leak or a "not strictly public but if it fell into the hands
of a bunch of people we want to hire then I guess we'll just have to deal with
it" sort of thing?

With this and the recent Michael Abrash blog post, I get the feeling that
Valve is putting a bit more attention into making themselves attractive to
developers. Frankly, I think it's working.

------
ChrisNorstrom
It works really well because Valve hires only highly experienced Senior
people. Which is why they're able to manage themselves.

They liked my game ideas in my blog (I even predicted Steam's Big Picture
mode) and I got a call from Greg Coomer, but ultimately I never got an
interview because I didn't have the experience and hadn't shipped any real
profitable products. It was a really nice reality check though. It made me
realize where I am in life and where I need to go. So thank you Greg.

Also, they play the "Portal - Still Alive" song when you're on hold.

------
xpose2000
This is one of the coolest looks behind the scene's of one of the world's most
successful companies. I have read every page.

As they mentioned in the handbook, Value's revenue per employee is the highest
in the world.

Source: [http://www.forbes.com/forbes/2011/0228/technology-gabe-
newel...](http://www.forbes.com/forbes/2011/0228/technology-gabe-newell-
videogames-valve-online-mayhem.html)

------
tayl0r
To everyone wondering if it was leaked on purpose or whatever, it clearly says
right at the top:

Originally uploaded to <http://cdn.flamehaus.com/Valve_Handbook_LowRes.pdf>
Handbook courtesy of Valve

So, they shared it on purpose and are not trying to disguise it as a "leak".

------
benaston
"Gabe Newell — Of all the people at this company who aren’t your boss, Gabe is
the MOST not your boss, if you get what we’re saying."

Most egregious example of double-speak ever?

~~~
X-Istence
How exactly is this double speak? I am parsing this as saying that "nobody" is
my boss (if I were at Valve), ESPECIALLY Gabe. If I am working on a team and
there is a team lead and he asks me to do something I am most likely inclined
to do it with little pushback/skepticism, what the handbook is saying that if
Gabe tells me to do something I better damn well run it by 1 or more other
people (the team I am on most likely) and discuss it before I even think of
doing what he suggests.

~~~
getsat
I thought it was a not-so-subtle tongue-in-cheek reference to Gabe's
weight/size. He's a big guy. _shrug_

------
shykes
I really like that they highlight and discuss possible downsides of their
approach. It makes it a more credible source of inspiration and discussion for
other companies.

In my experience it's really difficult to use material from Github or
37signals, for example, to start a constructive conversation on work
practicess at your own company. Half of the team might dismiss it as a self-
promotional, patronizing PR fluff piece, while the other half might gobble it
up and fail to rationally weigh the pros and cons. And everyone gets this
vague unpleasant feeling of being told that they're inadequate - like a
15-year old girl watching a weight watcher commercial.

------
teamonkey
Where does this come from? Has Valve officially released this, is it a leak,
or is it a fan-made construction?

------
eumenides1
Page 55, Josh Weier, 14 year old boy. Google him. This manual is from this
year and it says he is 57. He really does look like he's been bathing in stem
cells

~~~
citricsquid
You're right, he looks late twenties at most! Here's a video of him:
[http://www.destructoid.com/pax-east-valve-s-josh-weier-
talks...](http://www.destructoid.com/pax-east-valve-s-josh-weier-talks-
portal-2-196903.phtml)

~~~
trafficlight
I watched the whole thing and I just can't believe that.

~~~
jewbacca
I'm almost completely certain this is a joke. He's probably in his late 20s.

------
v21
For me the most impressive part is where they list things that Valve sucks at.
How many companies have a list like that?

------
codeonfire
If Valve's organization is simply to let employees fight it out thunderdome
style to see who controls projects, culture, and direction, the organization
should be grown by spinning off completely new and independent businesses, not
by hiring people. Then the economics of free enterprise provides a true
risk/reward system. With salaried employees rewards are capped. Employees will
only stick around until they discover that the real economy pays much better
for hard work and good ideas and that the risks are basically the same: no
income.

The "we have no structure" culture is disingenuous. I don't buy the idea that
most of the employees at valve don't want to dominate all the projects and
their coworkers. It is exactly the same anywhere. You can't simply say 'we
don't have managers' as obviously only certain people are going to have power
of budget and final hiring decision. Only certain people can sign documents.
Only when employees can expense anything they want and hire anyone they feel
should be hired would a "no managers" description be appropriate. You might
say that this would never work, but it does work if each employee is given
assistance or investment to spin off a new organization at any time, hire
anyone, and spend money.

~~~
angersock
_"With salaried employees rewards are capped."_

Now, this might surprise you, but working on cool projects can be its own
reward. Your utility metric is flawed.

 _"I don't buy the idea that most of the employees at valve don't want to
dominate all the projects and their coworkers. It is exactly the same
anywhere."_

Did you perchance get your worldview from anime? Really? This might also
surprise you, but a lot of well-functioning folks don't care about petty
politics as much as doing cool stuff.

~~~
codeonfire
"working on cool projects can be its own reward. Your utility metric is
flawed."

Everyone is entitled to their opinions. My opinion is people that say they
don't care about monetary rewards are bullshitters. After all, if you have
enough money you can work on any project you want.

"a lot of well-functioning folks don't care about petty politics as much as
doing cool stuff."

A lot of people SAY all they care about is doing cool stuff. People employed
at a company to earn money are not these people (but they see if people will
buy it anyways). Denying that you're playing politics is politics 101.

~~~
pvh
"After all, if you have enough money you can work on any project you want."

Well, not Half-Life 3. To do that, you have to take a job at Valve.

------
DanielRibeiro
I can see why they would not want this leaked:

 _Fishbowl— The conference room by the lunchroom. The one with a bigglass
wall. Don’t let the name throw you—we don’t actually use it as a fishbowl!
Except, of course, on Fishbowl Fridays, where we fill it up with tenthousand
gallons of putrid saltwater so that all the manta rays and sharks will have
something to breathe while they fight to the death. You won’t seeit in your
list of benefits, not because it isn’t fun, but because it is illegal._

------
joss82
Best part so far: "Accepted truisms about sales, marketing, regionality,
seasonality, the Internet, purchasing behavior, game design, economics, and
recruiting, etc., have proven wrong surprisingly often. So we have learned
that when we take nearly any action, it’s best to do so in a way that we can
measure, predict outcomes, and analyze results."

------
masenghi
Half-Life 3 t-shirt. Page 22.

------
danso
Inspiring reading. I wish they had chosen a better example of the archtypal
"T" employee than the Heavy class...many of those attributes he has are just
things that are obvious consequences/contributing factors to his main skill
"hugeness, killing people".

~~~
neilk
I wonder how much of Valve's internal culture is reflected in their games,
like TF2. Portal seems to be the dystopic mirror image.

~~~
jrockway
I wonder how many employees bring their daughter to work on "bring your
daughter to work" day.

------
balloot
I just can't believe that this works as seamlessly as the handbook would have
you believe. It seems it would create a very Lord Of The Flies/cliquey
atmosphere. In a group of people, there _always_ exists some kind of
hierarchy, whether it's explicit or implied. In this case, there is zero
attempt to create an explicit power structure, so it's 100% implied, but I
don't see why that's fundamentally better.

In general this sounds like the natural structure for pack animals, where you
join a pack and no one anoints a power structure, but it becomes clear very
quickly who is "alpha", "beta", etc. IMHO it sounds like it possibly could be
a very stressful situation.

~~~
Tloewald
Having an org chart hierarchy doesn't prevent natural hierarchies that don't
match it from forming, and now you have two problems.

I suspect it doesn't work perfectly, but what does?

------
10098
Somehow I tend to think that this leak is intentional... and it may be that
the document has been specifically written for that purpose. Anyway, if what's
written is true, Valve must be an amazing place to work at.

------
keyle
Does this remind anyone of the dharma initiative type videos?

~~~
bvdbijl
Haha yes! I think their art style (60s) is very similar to that of the Dharma
initiative as well

------
icco
This is a cool handbook. I wonder what the frustrations are that come with
this? As the book says, Valve sucks at disseminating information. It'd be
interesting to see if there is some sort of pervasive feeling of "why didn't I
know about that project? I wanted to work on that."

------
justnearme
I wonder how a Japanese company would react to such a radical perspective on
company management!

------
Novex
In case anyone wants to read this on their e-reader, here is a single page
version -
[http://dl.dropbox.com/u/2177514/Valve_Handbook_LowRes_single...](http://dl.dropbox.com/u/2177514/Valve_Handbook_LowRes_singlepage.pdf)

------
gruseom
This document is revolutionary.

How well does it reflect what actually goes on at Valve?

------
codesuela
I wonder if this only applies to the game developers or other Valve staff (say
web developers) as well. Is there anyone here working at Valve to could clear
this up?

~~~
brown9-2
Why would they apply it differently to non-game developers?

 _"Whatever group you’re in, whether you’re building Steam servers,
translating support articles, or making the tenthousandth hat for Team
Fortress 2, this applies to you."_

~~~
balloot
Well, I can imagine there's a lot of web designers who would love to take a
shot at working on the physics engine for the next Portal game. Or play
testers that would rather be actually doing development on the games. It would
be interesting to see how people are cajoled into doing "lesser" jobs.

~~~
marshray
I imagine they have an endless supply of folks wanting to be play testers.

I suspect much of it is done by those of sub-employee status. But that's just
a guess. Perhaps someone who actually knows will fill us in.

------
kghose
This is awesome. The part about picking your project is just like picking a
research program as an independent researcher in the sciences!

------
charlesju
What a great read. Do you guys know if there are other companies that have
handbooks available for the public?

------
fromhet
This kind of company coulture seems to run thru the most succesful software
companies, such as Google is prominent is their areas, Valve are huge in
games, Facebook seems to work in the same way. AFAIK Apple is hierarchical and
is run in a very "traditional" fashion, but are still very successful.

Is there a pattern about theese things, and what way of managing a software
company works best?

EDIT: Also, Half-Life is the best game ever.

~~~
vladd
Unless you've worked at those companies, I'd suggest you refrain from stating
that Google&co compares in openness with Valve in the way they let new-hires
pick their own starter teams and similar things.

~~~
michaelochurch
Google hasn't been that way for a long time.

You can move around as you wish if you're a Real Googler. The Real Googler
Line used to be Senior SWE; now it's somewhere between Senior and Staff. Staff
are Real Googlers, and Seniors who are likely to make Staff are Real Googlers,
but Seniors who are perceived as having plateaued are not.

If you're not a Real Googler, 20%T will be perceived as slacking off, and
you're going to have a hard fight to get a transfer. Generally, it's hard to
transfer unless you've had a recent promotion, so if you're not going to get
promoted based on your current project, you might as well leave.

~~~
mikeytemple
Wow, that's unfortunate too. Combined with your previous comments I have to
assume that you were a long time googler. Can you tell us what it was like
back in the day? I'm really curious how big companies change / devolve over
time.

~~~
inklesspen
michaelochurch worked at Google for less than a year.

~~~
Drbble
Mikeytemple is having a little fun keeping following mchurch around and
keeping mhurch honest today.

------
markmsmith
This is really a great example of how to do things right. I wish more
companies were like this.

------
djhworld
I wish all companies were like this.

~~~
garethsprice
This model seems limited to companies that are staffed with highly motivated,
highly skilled people. I don't think you'd want, say, a branch of McDonalds or
a nuclear power station to be run on this model.

~~~
neilk
I'm not sure about that.

Maybe a nuclear power station, as we currently design them, requires very
rigid procedures. But that probably also reduces internal information flow,
punishes people for noticing problems, and so on. So perhaps that's really an
argument against nuclear power as we know it.

McDonald's isn't designed the way it is because people are stupid. It's
designed to maximize returns on capital investment. Workers are made to be
interchangeable, and the product is uniform and predictable. For 300,000
years, humans self-organized to take down caribou or whatever to make our own
dinner. Is it really likely that we _need_ a system like McDonald's to get a
burger made?

~~~
bdunbar
_Is it really likely that we need a system like McDonald's to get a burger
made?_

I make a pretty fine burger, myself. And my own bread, for the buns.

But if you want to deliver a consistent product across thousands of stores for
a reasonable price, you need standards, managers, guys behind the counter
performing to task and standard. So you can walk into a restaurant in Bangor
or in Spokane and know what you're getting.

Yet .... I can't deliver a home-cooked burger without the same structure
McDonald's uses.

I get my meat from a butcher who gets it from some other guy and so on on back
to Bossie in the pasture. That's one thing out of hundreds of bits that make
up daily life.

We all of us depend on millions of others doing things to task and standard
just to exist - it's baked into the bones of our society.

I don't think you can just get rid of it without building a system to take
it's place.

~~~
shykes
Maybe this tells us that the staff of a McDonald's restaurant could
conceivably be replaced by software, whereas Valve will always require human
beings to do its work?

~~~
bdunbar
_replaced by software_

See also Marshall Brain 'Manna'.

Conceivably, yes.

But I don't see it, or not real soon. Automation even in a controlled
environment is tricky, and random customers are _random_. You have people
there to handle exceptions, which are many.

------
zaptheimpaler
This is incredible. Valve is possibly the only company EVER that truly
operates with a completely flat hierarchy and does so well!

------
Ahadiel
A

------
michaelochurch
There are a lot of good ideas in here, but stack-ranking is a terrible one.

First, it makes people hate each other. Anyone who comes up in the bottom half
is going to be looking immediately to move to another group simply because he
ended up in the bottom half. And if someone ends up near the bottom and ends
up with no bonus or on a PIP, he's going to be spending the next few months
trying to figure out who screwed him, which creates this whole side game that
has nothing to do with actual work.

Second, it encourages people to work on the projects that are most visible,
which are not always the most valuable.

Third, it creates a general atmosphere of distrust. People are constantly
watching their back for others who might screw them in the peer review
process.

This is an outsider's view and a microgripe, and I think a lot of the ideas in
that book are good ones. I just saw the words "stack ranking" and knew I had
to speak up. It's seriously not a good idea. If someone's going to get
whacked, it should happen for a real reason, and not because that person ended
up in the bottom 15% because only a couple people knew what he was working on.
Maybe he was working on something important but unglamorous. I've seen that
kind of shit happen all the time with stack-ranking systems.

~~~
officemonkey
As long as stack-ranking is only done to adjust compensation, I don't really
see the problem.

As a more traditional manager, I have to consider salary adjustments for my
employees. What Valve seems to be doing is to let everyone consider salary
adjustments for (half) of the team.

And since the rankings appear to be averaged out, one vindictive co-worker
isn't likely to screw you over.

>it creates a general atmosphere of distrust.

Alternately, it creates a culture of responsibility. You want to do well in
stack-ranking, so you're going to do your best work.

Finally, 50% of any group are below average. I honestly wouldn't mind being
considered "the dumbest guy in the room" if I got to work at a dream company.
See the following quote from Moby Dick:

>And there is a Catskill eagle in some souls that can alike dive down into the
blackest gorges, and soar out of them again and become invisible in the sunny
spaces. And even if he for ever flies within the gorge, that gorge is in the
mountains; so that even in his lowest swoop the mountain eagle is still higher
than other birds upon the plain, even though they soar.

~~~
michaelochurch
If it's only used for compensation, I agree that it's not such a big deal.
Getting a 10% year-end bonus instead of 20% is not exactly "getting screwed".

The only large (200+) private-sector company where I've worked is Google,
where their stack-ranking/Perf system had some serious problems.

The first was a 5% cut-line. If you were in the bottom 5% of the Perf stack,
you ended up on a PIP. Who usually ends up here? Some were objective
underperformers, who'd been coasting for years, in some cases running at less
than 1 CL per month. Most, on the other hand, were junior people on
underperforming teams-- and of course, those junior people had the least to do
with that team's underperformance, but they were poorly established so they
got the shaft. That's how most layoffs actually work: junior people who landed
on the least effective teams. It's not atypical, but it's dysfunctional.

By the way, PIPs have nothing to do with "improving performance". They exist
to make it easy to fire people without severance. I actually think PIPs are
imbecilic, because I'd rather cut a 3-month severance check and separate
cleanly than keep a fired employee in the office for 1 month, but that's
another rant. PIPs make the finance department happy (look at what we saved on
severance payments!) but piss all over morale and make the manager's life
hell, to say nothing about what they do for the PIP'd employee.

At Google, a PIP is effectively permanent. Even if you pass the PIP, you
become damaged goods and can't transfer. It sticks around on your permanent
record until you leave.

Which brings discussion to the second problem with Google's system. It sticks
around forever.

When these types of systems get rotten is when they start getting in the way
of peoples' transfers. It means that the people who really should be moving to
other projects can't get on to them because no one wants to take a chance on
that guy who was an "objective underperformer" in Q4 2005.

So, to come around to your point, I agree that if the rankings are _only_ used
to adjust pay, there's not much harm done. Unfortunately, it's rare that data
collected is only used for the stated purpose. If these numbers start damaging
peoples' ability to choose their own projects, it can become nasty quickly.

~~~
chrisbroadfoot
Sorry, but what does any of that have to do with what happens at Valve?

Is there actually some relation between your story and Valve?

~~~
chwahoo
I suspect that people are interested in an article about Valve's culture not
(just) because they'd want to work at Valve, but also to take its good ideas
and use them elsewhere. I think talking about how one of those ideas worked
well or poorly at another company fits perfectly with this discussion.

~~~
gruseom
It seems foolish to "take" one small part of the thing and try to "use" it
elsewhere, while ignoring the massive difference that dwarfs all the others:
workers managing themselves. That's what's important and new here, and that,
supported by the fact that Valve has been so profitable, is what we ought to
be talking about.

This discussion is the HN equivalent of the prospective employee/er who pays
lip service to "culture" but is really only interested in salary.

~~~
Tloewald
Very carefully selected workers managing themselves. Not just any workers.

------
tubbo
Now I know why they made Half-Life the way they did. Gordon Freeman feels
exactly the way you would feel when you start working at Valve.

------
ben0x539
This doesn't make my quest to find the guy who's responsible for only shipping
no-gore versions of Team Fortress 2 to Germany any easier!

~~~
icco
Sure it does, just join Valve and do it yourself.

