According to this article, Google’s 20% time never really existed. I’ve always guessed as much, joking with Google friends that their 20% time really could only be taken on Saturday and Sunday. Which is all the same: Engaged employees do what they feel needs to be done no matter what and when.
Hackathons, however, exist. Facebook, SAP, and Suse are example companies that organize them with the purpose of prototyping potential new products. For all that I can say, the dirty little secret is that there are no successful hackathons without 20% time (make it +/- 15%). I’m betting that rarely was there a successful hackathon without a run-up to the hackathon that involved significant preparation, that is, “20% time”.
As a consequence, for hackathons to succeed, employees must not be disenfranchised or overworked. Otherwise they won’t spend their personal time talking about and preparing for a hackathon. Also, they should have a purpose, that is, be tuned in to the company’s mission. I guess this means that the better the company is doing, the more likely it is to get something out of their hackathons.