SAS’s Silver Lining


In this blog post I’m going to explore the very unusual working conditions at SAS Software (FYI-their cafeteria has octopus shaped hot dogs for kids-enough said)

Inside Fortune’s 100 Best Places to Work, on the second place lies SAS Software based in Cary, North Carolina. Odds are you haven’t heard about this company if statistics is not your hobby (I know I haven’t until my Organizational Theory class). This company however, provides high-grade statistical software to both government agencies and private enterprises. In fact, most of Fortune 500 companies use SAS software in one shape or form. By using SAS, companies optimize their retail prices, compile results from clinical trials, track usage patterns in casinos, get insight from social media and marketing , optimize communications, track fraud, model risk, do scenario analysis, make fine pancakes.

Commercially, the company has been unusually successful. SAS was started as a project in North Carolina State University’s agricultural department in order to analyze how different factors would affect yields. Gradually, educational and commercial versions of the software were released. The company had more than ten percent growth per year, reaching $1.1 billion in 2000. They also spend a large amount of their revenues on Research and Development.

I’m sure Milton Friedman would argue that SAS is great because it’s being run in concordance to shareholder interests and is successful in maximizing value.

Only that…he’d be wrong. SAS is the largest privately held software company in the world. And more famous than their profits and growth is their unique work conditions.

It can be argued that the campus feel found at Google and more recently Apple was actually inspired by SAS (they did it first!) Employees at SAS have a series of amenities that are simply unheard of at most companies. A subsidized cafeteria, gourmet cafes, fresh fruit, free snack (22.5 tons of M&M’s per year consumed at SAS!) and drink stations at every floor, a health clinic, a farmers market truck, state of the art recreation and fitness center with personal trainers, Olympic-size pool AND a private office for every employee are some of the benefits that you receive at SAS. The salary that employees receive at SAS is still comparable to other software companies, if only slightly lower to cover costs for the excellent work conditions.

Are the great physical work conditions the only thing keeping people at SAS? No. The culture at SAS is extremely egalitarian and compassionate. The organizational structure is extremely flat ( for example, the Executive Vice President knows much about the code being written), schedules are extremely flexible, work is managed by groups that agree on deadlines and there is an incredible focus on family and work-life balance. A subsidized daycare center is present in the campus, alongside family friendly dining options and there is even a work-life balance division that focuses on making sure employees don’t burn out.

This translates into incredibly low rates of turnover for the company. Only 4% of employees leave every year, compared to the 20% industry average. During the recession, one of the first actions the CEO did was to announce that there would be no layoffs in order to maintain morale at the company.

Reading the articles that glorify SAS made me rather skeptical. I wanted to believe this, this, this, this and this. After searching Google and Google News, there was simply no article that I could find that brought significant criticism to SAS. What I really liked was that the company’s spokespeople were explaining that SAS isn’t trying to be philanthropic, it is simply offering incentives to employees to be productive, reduce replacement costs and create a positive environment. Every benefit had to be in accord with SAS’s culture, serve a large number of employees and have a perceived value higher than its cost.

Glassdoor was my last stop in my search- I wanted to find that one disgruntled employee that left a bad review for the company.

A couple of issues were readily apparent at SAS. Many reviews criticized the lack of opportunity for growth (if people don’t leave…how do positions become available?), very politics-oriented management styles, preferences based on seniority and not meritocracy and even the lack of diversity in hiring. It seems to me that for some people, the very flat structure and focus on retention made SAS a nice if rather boring place to work. Many were criticizing the lack of focus on sales and lack of innovation.

It is always possible to find former disgruntled employees. They might have not been  compatible with the corporate culture or perhaps they had a mid-level manager that was simply inadequate. Some of the issues such as lack of upwards mobility or lack of diversity are however serious structural issues that the company needs to deal with. I’ve had the distinct feeling however that even though SAS certainly has room to improve, it has achieved a balance of being very successful financially and also offering a positive environment to their customers, employees and surrounding community.

….Maybe some places are indeed simply better to work for than others.

Pictures were found on The Huffington Post.

Advertisements

3 thoughts on “SAS’s Silver Lining”

  1. Vlad, I loved reading this post! You bring up so many great points about why SAS has such happy employees such as the amenities they are offered and the security that comes with their jobs. However, a point that stood out to me was when you mentioned that their salaries may be lower than others in the industry in order to provide for all their amenities. Do you think that if people knew they could be making more money they would give up their fancy food stations and yoga classes? Or do you think they would prefer the freedom that comes along with their job and put their salaries second?

    I also think it’s important that you really searched to find out if their were and criticisms against the company. However, having limited mobility is not a unique problem for SAS. I’ve read many blog posts that in fact talk about how this is an issue through out industries. So, it almost seems as if there isn’t a good way to win in this situation; either your employees are mad because they can’t make it to the top of the company or they are mad because they have to leave.

    Like

    1. Thanks Emily! Glad you liked it-reading about SAS really made me daydream about having such a great working environment.

      My theory is that most people self-select into the environment at SAS because they simply prefer working in a better environment for less pay rather than a less relaxed one with more pay. With a bit of research there’s ways to find what the approximate salary might be at SAS compared to other software companies.
      I’m also sure that there were people who joined SAS and became disillusioned with the conditions there (Ex: do I want more money or an Olympic-sized pool considering swimming is not my cup of tea?) and chose to leave in search for a job that simply pays more.
      I feel it’s a very personal choice: Do I spend 40-60 hours a day in a cubicle but get to do so much more in my free time (save up for vacations, college fund, the new Iphone, etc) or do I prefer less money but just an all around better experience while at work?

      Many of the articles I’ve read made SAS look like one of the best places to work-period. But I’m sure it’s not the best place to work for many people who just might not fit with their culture and have different expectations.

      Like

  2. Vlad, I too enjoyed reading your post. You nicely articulated the culture at SAS and how they choose to make their employees feel comfortable at work. I’m sure your investigation into any criticism of SAS was thorough and it was surprising to hear that there was nothing of any sort of significance surrounding business practices. It seems as if scandals such as these are easy to find these days. Some of the criticism you did find was similar to some of the things Cameron mentioned in his review of Qualcomm, such as the lack of upward mobility within the company. The links you provided certainly seem to illustrate that “some places are indeed simply better to work for than others” and that SAS might be one of these places. You make a good point in your response to Emily, however, when you mentioned that while some of SAS’ offerings may be beneficial to some people, this may not be the case for others.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s