I recently had a chance to read the employee handbook from video game company Valve and it’s the single most inspiring such document I have ever seen.

I play some video games myself (the Bioshock and Dead Space franchises are my favorites), but if you don’t partake you may never have heard of Valve so here’s the skinny from Wikipedia:

Valve Corporation is an American video game development and digital distribution company based in Bellevue, Washington, United States. Founded in 1996 by former Microsoft employees Gabe Newell and Mike Harrington, Valve became famous from its critically acclaimed Half-Life series. It is also well known for its social-distribution network Steam; and for developing the Source engine.

Valve is privately owned so few financial figures are known but they have 300 employees and Forbes estimates the company’s worth at $3 billion.

Their employee handbook was recently released on the web and it explains how they’ve become so successful. Here are the top 10 most awesome things from the document.

1: Valve has no hierarchy

Hierarchy is great for maintaining predictability and repeatability. It simplifies planning and makes it easier to control a large group of people from the top down, which is why military organizations rely on it so heavily.

But when you’re an entertainment company that’s spent the last decade going out of its way to recruit the most intelligent, innovative, talented people on Earth, telling them to sit at a desk and do what they’re told obliterates 99 percent of their value.

That’s why Valve is flat. It’s our shorthand way of saying that we don’t have any management, and nobody “reports to” anybody else. We do have a founder/president, but even he isn’t your manager.

How cool is that?

2: Pick your projects

We’ve heard that other companies have people allocate a percentage of their time to self-directed projects. At Valve, that percentage is 100.

Heh :o) Screw Google and their “20% time to work on your own projects.” Valve turned that dial to 11!

3: Don’t forget the long term

Because we all are responsible for prioritizing our own work, and because we are conscientious and anxious to be valuable, as individuals we tend to gravitate toward projects that have a high, measurable, and predictable return for the company.
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This sounds like a good thing, and it often is, but it has some downsides that are worth keeping in mind. Specifically, if we’re not careful, these traits can cause us to race back and forth between short-term opportunities and threats, being responsive rather than proactive.

So our lack of a traditional structure comes with an important responsibility. It’s up to all of us to spend effort focusing on what we think the long-term goals of the company should be.

In many, many workplaces where employees are unhappy and frustrated because their workdays are entirely taken up with putting out one fire and then the next, leaving no time for long-term planning of any kind. Valve try not to fall into that trap.

4: Don’t stress over the things you don’t do

It’s natural in this kind of environment to constantly feel like you’re failing because for every one task you decide to work on, there will be dozens that aren’t getting your attention. Trust us, this is normal. Nobody expects you to devote time to every opportunity that comes your way. Instead, we want you to learn how to choose the most important work to do.

At most workplaces there is a huge and unrelenting focus on the things employees haven’t done. Almost every meeting, email and phone call are intended to remind people of the next deadline and how far away they are from reaching it. Valve try to take the pressure of employees so they don’t stress over the things they don’t do.

5: We test ourselves

…rather than simply trusting each other to just be smart, we also constantly test our own decisions

Yes. Don’t believe your own hype. Test your decisions and adjust as needed.

6: Overwork is bad

While people occasionally choose to push themselves to work some extra hours at times when something big is going out the door, for the most part working overtime for extended periods indicates a fundamental failure in planning or communication.

This is a brilliant slap in the face to all members of The Cult of Overwork, ie. everyone who believes that the key to succes is simply to work more hours.

7: Enjoy yourself

Sometimes things around the office can seem a little too good to be true. If you find yourself walking down the hall one morning with a bowl of fresh fruit and Stumptown-roasted espresso, dropping off your laundry to be washed, and heading into one of the massage rooms, don’t freak out. All these things are here for you to actually use.

And don’t worry that somebody’s going to judge you for taking advantage of it—relax! And if you stop on the way back from your massage to play darts or work out in the Valve gym or whatever, it’s not a sign that this place is going to come crumbling down like some 1999-era dot-com startup.

If we ever institute caviar-catered lunches, though, then maybe something’s wrong. Definitely panic if there’s caviar.

In short, you should feel good during your work day.

8: You’re free to screw up

Nobody has ever been fired at Valve for making a mistake.
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Providing the freedom to fail is an important trait of the company — we couldn’t expect so much of individuals if we also penalized people for errors.

Yes! I cannot stress enough, how important it is to let employees make mistakes.

In fact, we should celebrate mistakes at work.

9: It’s not about growth

We do not have a growth goal. We intend to continue hiring the best people as fast as we can, and to continue scaling up our business as fast as we can, given our existing staff. Fortunately, we don’t have to make growth decisions based on any external pressures — only our own business goals. And we’re always free to temper those goals with the long-term vision for our success as a company. Ultimately, we win by keeping the hiring bar very high.

Yes! Way too many businesses are slaves to growth goals that are arbitrary, unrealistic and ultimately meaningless.

As Ricardo Semler put it:
There is no correlation between growth and ultimate success. For a while growth seems very glamorous, but the sustainability of growth is so delicate that many of the mid-sized companies which just stayed where they were doing the same thing are much better off today than the ones that went crazy and came back to nothing. There are too many automobile plants, too many airplanes. Who is viable in the airline business?

10: Hiring

Hiring well is the most important thing in the universe. Nothing else comes close. It’s more important than breathing.

So when you’re working on hiring … everything else you could be doing is stupid and should be ignored!

Again, this is brilliant. Nothing undermines a strong positive company culture faster than hiring people who don’t fit in.

In short, this is a fantastic document and one of the coolest things about it is that it’s maintained by the Valve employees themselves, who are free to edit it on their intranet.

You can find the whole Valve Employee Handbook here – read it, read it, read it :)

Your take

What do you think of these 10 points? How does this document compare to your workplace’s employee handbook? Is there anything in your employee handbook that inspires you?