Team 10
Tara Ferguson
JT Lehotsky
Taylor Skidmore
Phuong To
ORGANIZATION
OF GOOGLE
History of Google
• Began March 1996 as a Stanford research project by
Larry Page and Sergey Brin.
• PageRank: pages with the most links to them from
other relevant web pages must be the most
important pages associated with the search.
• Formally incorporated as Google Inc., on September
4, 1998.
• In 2000, began selling advertising based on search
keywords.
• By 2004 they made their first initial public stock
offering.
Google’s Mission
• “Organize the world's information and make it
universally accessible and useful.”
– New approach to online search that quickly spread to
information seekers around the globe.
– Google focuses on using its mission to connect it’s users
to their core business, the search engine.
• Code of conduct--“Don’t be evil.”
– “We believe strongly that in the long term, we will be
better served, as shareholders and in all other ways, by a
company that does good thing for the world even if we
forgo some short term gains.”
Google’s Core Business
• Advertising
– Google receives demand for advertising mainly
from businesses that sell a large range of
consumer products, and services.
– AdWords: Advertisers select their own target
keywords and only pay when customers click on
their ads.
– Google’s main revenue is generated by providing
online advertising, at over $10 billion a year.
Google’s Core Business
• Search
– Google’s main focus is developing the best search
engine possible.
– Company developers provided the fastest, most
accurate results requiring a new kind of server
setup.
– Google uses a system created by the company’s
founders called PageRank, which is meant to help
rank web pages that match a certain search query.
Environmental Factors
• Geography
– Google’s main headquarters are located in Mountain
View, CA.
– Competes internationally in Asia Pacific, the Middle
East, Latin America, Canada, and Europe.
• Social
– Most common age distribution 35-44: 22.93%
– Affluent users
– Important consumer of Google consists of their
business to business operations.
Technology
• Stands out from competitors through processes
such as information technology, analytical decisions,
and product development.
• Google rapidly comes up with new ideas to expand
their offering mobile phones, social networks,
operating systems, blogging, etc.
• Organization structure is suited to implementing an
entire product-development life cycle quickly and
efficiently.
• Google simultaneously tests and markets the
products to the user community.
Political
• Copyright Accusations
– Faced with an anti-monopoly inquiry from the
Department of Justice.
– Scanning copyrighted books from libraries for use
in its book search service was a violation of
copyrights.
Political
• Privacy Standards
– Stop the merger of Google and the online
advertising firm, Doubleclick.
– Interest groups filed a complaint with the FTC, and
they agreed to conduct an anti-trust review of the
deal.
– Wanted more transparent information on how
their personal information is collected and used.
Political
• Censorship Laws
– Announced that they would follow internet
censorship laws in the People’s Republic of China.
– Firewall allows for self-imposed censorship of
certain keywords that are on a blocked list
maintained by the government.
– They feel providing some information is more
consistent with their mission then providing none
at all.
Political
• Google has a lot of influence on American
politics.
– They have a large control over the distribution of
information.
– Google Public Policy. Includes their views on net
neutrality, censorship, innovation regulation,
immigration, R&D, national security, and trade.
– Online video debates of presidential candidates.
– NetPAC: supports candidates who promote an
open and free Internet for users.
Organizational Structure
Google’s Organizational Chart
Eric Schmidt,
Chairman of the Board
and Chief Executive
Officer
Larry Page,
Sergey Brin,
Co-Founder &
President, Products
Co-Founder &
President, Technology
Jonathan Rosenber,
Senior Vice President,
Product Management
Alan Eustace,
Senior Vice President,
Engineering &
Research
Susan Wojcicki,
Jeff Huber,
Vice President,
Product Management
Senior Vice President,
Engineering
Patrick Pichette,
Senior Vice President
& Chief Financial
Officer
Omid Kordestani,
Senior Advisor, Office
of the CEO and
Founders
W.M. Coughran,
Senior Vice President,
Engineering
Urs Holzle,
Nikesh Arora,
Senior Vice President,
Operations & Google
Fellow
President, Global Sales
Operations and
Business Development
Laszlo Bock,
Vice President, People
Operations
Rachel Whetstone,
Vice President, Public
Policy and
Communications
Shona L. Brown,
Senior Vice President,
Business Operations,
Google Inc.
David C. Drummond,
Senior Vice President,
Corporate
Development and
Chief Legal Officer
Organizational Structure Cont.
• Flat Structure
– Has few levels of executives between employees
and management.
– Allows for ease of communication with upper
management and quick decision making.
– Important to the company to maintain the feel of a
small organization.
– Committed to every employee, they each have
something important to contribute, and everyone
that works there is valuable to their success.
ANALYSIS OF
GOOGLE
SWOT Analysis of Google
Strengths
-
PageRank system
AdWords
Cloud Computing
Weaknesses
-
Opportunities
-
Social network industry
Expanding services to Mac and
Linux
No metadata to filter search
results
Privacy issues
Threats
-
Increasing competition leads to
revenue decrease
Intellectual property rights
Hedgehog Concept
What Google is
deeply
passionate about
What Google
can be best in
the world at
What drives
Google's
economic
engine
4 Action Framework
REDUCE:
- Employees
- R&D Costs
ELIMINATE:
- Pop-ups
- Payments for search results
- Newspaper and radio ad units
Google's
Current
Value
Curve
RAISE:
- New ad formats
- Needs of users
- Global access
- Search tools (Google.com)
CREATE:
- Web browser
- Apps
Google’s Globalization Drivers
Cost Drivers
Competitive Drivers
- Nature of industry
- Economies of scale
- Globalization of
competitors
- Differences in
country costs
- Interdependence
between countries
Market Drivers
Government Drivers
- Evolution of
customer needs
Google's
- Regulatory climate
- Global customers
Globalization
Potential
- Technology
- Standards
INDUSTRY AND
COMPETITORS
YAHOO! INC
•1994, Jerry Yang and David Filo - Stanford University
•making a guide on the campus trailer
•“Jerry and David’s Guide to the World Wide Web”
•“Yahoo!” = Is the acronym for “Yet Another
Hierarchical Officious Oracle”
Way to the breakthrough
• 1996: 1st I.P.O. of $1billion
• 1998-2008: acquired different companies and
services (Y!Mail, Y!Messenger, GeoCities,
Flickr, del.icio.us…)
• Went into Asia
• Never had a search engine until 2003
But failed in the end
• 2005-2008: several attempts from Microsoft
• 2001-2008: 3 times CEO changed
• Jul 2009: Microsoft $20billion for Y! search
engine (stock price $33 2008 to $15.4 2009)
• Shifts to displaying ads and online services
• Last 4 years: 92x decrease in operating
income, 4.5x decrease in total income,
Baidu Inc.
•2000 a Chinese language Internet search provider
•Provides an index of over 740 million web pages, 80 million images, and 10
million multimedia files & 57 search and community services
•Inspired by a poem written more than 800 years ago during the Song
Dynasty. The poem compares the search for a retreating beauty amid
chaotic glamour with the search for one's dream while confronted by life's
many obstacles
•The first Chinese company listed on the Basdaq list
•62.1 percents of Chinese market (Google - 29 percents)
•Last 4 years: 20x cash flow, 4x assets, 4x equity, 12x revenue, 40x operating
income
AOL
•1995-1999: WebCrawler, NetFind, Netscape
•1999: AOL Search
•2001: merger with Time Warner
•2005: Google got 5% of stocks
•2006-2008: profits decrease (-$13 mil in 2008)
•2009: split
MSN & Bing
•1998: MSN search
•2009: bing – disease in Chinese? very certain to respond? Or just bing!?
•Pay per click – on mobile phones
•10 years agreement with Yahoo! – 23% market share
•Decision engine instead of search engine/Innovation
•Quicktabs
•Interactive/smart (flight number, usb tracking number)
•Photos and videos
•Microsoft Advertising Intelligence (provides keyword expansion,
research, pricing, and KPI data allowing you to maximize marketing ROI
for your paid search and content ad campaigns )
Online Advertising Industry:
View from the top
•
•
•
•
•
Highly competitive
High customers’ purchasing power
Hard to enter
Best defense: brand name power
Basic formula: when there is a high brand recognition,
there is a higher numbers of users and subscribers (and
vice versa); and when there are both of the characteristics
above for an online ad provider, there will be more
customers and profits to the provider.
• Not so basic: innovation (Google and PageRank; bing and
excitement)
• Think a new company can enter that industry?
FORMING A STRATEGY
Revised 4 Action Framework
REDUCE:
- Search engine
- Advertising
- Cookies on user's computers
ELIMINATE:
- Google Earth
Google's
Current
Value
Curve
RAISE:
- Mobile devices and services
CREATE:
- Chrome OS
- Google Internet
Value Curve
High
Google Competitors
Google
Google
Competitors
Low
The Future is Here!
THE END!!!