While your statements may be true for a larger company, 20% time is working quite well for our consulting company for myriad reasons.
First, of course, there's the opportunity to work on side projects. The only stipulation is that it implicitly (for very loose definitions of implicitly) helps the company. Write open source code, write a blog post, work on your own internal project... but mostly it's been OSS hacking.
Second, it builds slack into our schedule. We (http://bendyworks.com) are a consulting company, and 20% time frees us to "promise" 4 days of work to our clients. And when the inevitable vacation day, sick day or holiday comes up, the client still gets their 4 days of work.
It also lets us push our book club into Friday, which makes it affect our clients' projects even less.
And for a good portion of us, a single day simply isn't enough to satisfy our hunger, so you'll often see a few hanging out at the office, hacking away on the latest clojure, ruby, raspberry pi, or life-hacking project.
I don't think it has that much to do with the size of the company though, but more with the difference between a consulting company and a product company.
In a consulting company, work is time-driven: every hour of work is intended to be billed to a customer. This makes the company very focused on time which makes it easier to dedicate X% of that time to individual's projects. In product companies, work is typically much more result-driven, which makes it more difficult to correctly attribute each worked hour of time to any specific activity. As a consequence, it is much more difficult to do these "X% projects" in part because the X is tricky to correctly measure and attribute.
First, of course, there's the opportunity to work on side projects. The only stipulation is that it implicitly (for very loose definitions of implicitly) helps the company. Write open source code, write a blog post, work on your own internal project... but mostly it's been OSS hacking.
Second, it builds slack into our schedule. We (http://bendyworks.com) are a consulting company, and 20% time frees us to "promise" 4 days of work to our clients. And when the inevitable vacation day, sick day or holiday comes up, the client still gets their 4 days of work.
It also lets us push our book club into Friday, which makes it affect our clients' projects even less.
And for a good portion of us, a single day simply isn't enough to satisfy our hunger, so you'll often see a few hanging out at the office, hacking away on the latest clojure, ruby, raspberry pi, or life-hacking project.