Keeping Google “Googley”

The unbelievable success of Google
•  Revenue growth
Ø  2004, $3.2 billion
Ø  2013, $60 billion
•  Net income growth
Ø  2004, $400 million
Ø  2013, $13 billion
•  Employees growth
Ø  2004, 3,000
Ø  2013, up to 55,000

The IPO stock growth from 2004 to 2014

January 2004,
24h after first IPO in
NASDAQ: $100 per
stock, public offer $2
billion.

October 2008, May 2014, first position on stock price over world most $1000 each. value company
January 23
ranking with
2008, loss of
$16.3 billion
$159 billion.

November 2007,
$700 per stock.

Critical Success Factors (1)
•  Customer-Centered Company
Google’s innovation process begins and ends with the customer to best fit his needs.

•  Data-based Approach
Every choice is supported by data, nothing is left to chance.

•  Quality of the Algorithm
The search engine measures consumers’ behavior and needs in more than 50 ways and anticipates their following search entries better than any other search engine.

•  AdWords and AdSense
95% of Google’s revenues comes from advertising, based on the analysis of customers’ search queries.

Critical Success Factors (2)
—  Continuous Innovation

Google is making huge investments in technology and R&D projects.

Google’s Research and Development Expense (Quarterly) Chart

Critical Success Factors (3)
•  Collective Entrepreneurship
Google is in a collective entrepreneurship with bloggers, advertisers, and viewers, sharing the risks and rewards from the discovery and exploitation of new business opportunities.
•  Various Channels for Expression
Google tries to diversificate channels for expression, recognizing that different people, and different ideas, might come up in different ways. •  Optimal Combination between Creativity and Science

Google aimes to combinate the technical and scientifical knowledge of the workers together with their creativity.

Unusualities (1)
•  Google’s objective is to provide harmony, and wellness to its employees, granting them a proper life balance, equilibrating work life and private life. •  To achieve this goal, the work schedule is flexible; hence, each employee can manage his daily hours of work according to his personal needs. •  Every Googler is recommended to spend 20% of his working time (i.e. one day per week) to develop personal projects.

•  Benefits for workers:

Free healthcare.
Free kindergarten.
Maternity Leave (not provided for by law in the U.S).
Company-sponsored ski trips.
Free laundry.
Reductions on several life facilities (e.g. housekeeper, hybrid cars).

Unusualities (2)
•  Flat organizational structure, permitting a short hierarchy in order to make the workers feel responsible and to stimulate their business attitude.
•  Campuses are designed to cross-pollination, that is a way to have people
from different functions and groups interacting with each other. •  The idea is to create an architectural structure that influences the performance of the employees and the way in which people communicate. •  A worker-friendly environment:

Open Space workplace.
Informal and comfortable fornitures.
Free Shuttle.
High quality services offered to employees (e.g. top-class chef, gym, swimming pool, sauna).

Best Practices (1)
•  Google wants to implement a decision-making process which is, at the same time, both quick and based on consensus, in order to improve the quality of the decisions taken.
•  This decision process implies risk-seeking at any level in the hierarchy; hence, no one gets in trouble for having made a bad decision since he has taken a risk.
•  The flat structure is the ideal organizational structure for this purpose. •  Google implented the “Avoiding Dilberville” process, consisting of a quarterly meeting to discuss employees’ issues and concernes and to focus on possible solutions.

Best Practices (2)
•  Google’s success depends on the Human Resources Management, there named People Operation (first place in the “100 Best Company To Work For” ranking by Fortune in 2008 ).
•  Google’s recruiting philosophy is to focus on the candidates’ personality traits that fit with Googleyness.
•  Recruited people are sought primarily within people sharing background
experiences, both academic and work-related, with Googlers.

Best Practices (3)
•  Frequent meetings and gatherings held, both functional and multifunctional. •  Google considers feedbacks fundamental. Each member is evaluated with a multi source assessment (360-degrees); peers’ and managers’ viewpoint assume equal importance.

•  The ultimate goal of the practice is the self improvement of employees. Accordingly, the company has followed a project, Project Oxygen, to define the lines of conduct held by the best managers and establish a behavioral model.

Googley SWOT analysis

Strengths

• Replication of efforts
• Projects Management
System
• Culture focused on
innovation and creativity

Opportunities
• International consistency

Weaknesses
• Difficulties in maintaining relationships

Threats
• Excess of bureaucratization
• Reduction of personal visibility
• Redundancy on people working on projects
• Maintenance of rapid decision-making

Bureaucratisation
•  Google is facing a challenge of bureaucratisation. It needs to manage the increases in headcount due to hyper growth, but at the same time maintaining a flat management layers.
•  Google hires middle-managers in order to reduce the span of control and to create an intermediate layer between the engineers and the functional managers for reaching a better focus on projects. •  Despite this, the increased size of the workforce should not directly translate into more bureaucracy, not to obscure creativity, execution of the company’s objectives and lack of personal visibility.

Employees Visibility
•  The rapid growth of Google’s workforce raised difficulties in crossfunctional organization; indeed, when facing a problem, an employee would not know whom to address.
•  The functional division and the phisical scattering of the people provoke lack of interpersonal relationships, which implies insufficient consciousness on others’ projects.
•  The lack of visibility within the company is also related with replication of effort causing redundancy on a huge amount of projects.
•  It is to be implemented a more transparent system, although having people with different background working on similar projects might be advantageous for the company.

Rapid Decision-Making

•  The hypergrowth in the past ten years entailed Google evolving into a multi-locational company; hence, this environment, where decisors are located in different branches, might result in difficulties for the company in keeping a rapid decision-making process.

•  Moreover, having consensus as a pillar of Google’s philosophy, the decision-making process could be slowed by such an increase in the number of workers.
•  In the end, the combination of these two factors results in a significant challenge to be faced by the company, in order to keep its decisionmaking process as quick as desired.

International Consistency
•  In spite the high growth of Google’s dimension around the world, the company took the opportunity of not exporting directly its culture to capture the unique perspectives of each region.
•  Thanks to this opportunity, Google created an oriented culture which is externally oriented and highlights differentiation within the marketplace. Innovation, creativity and the differences typified by the culture are critical for maintaining international consistency. •  Despite the cultural diversities of every region, Google’s philosophy manages to overcome all the boundaries, permeating all the layers troughout all the branches with its core principles.

•  This strategy enables Google to keep on pursuing the ambition of an international expansion.

Keeping Google Entrepreneurial (1)
•  Google believes innovation might come from any employee and, therefore, it should not stop developing a workplace that encourage creativity and passion for progress.
•  As a result, Google, should keep on focusing on his hiring process based on ‘A’ player recruiting with “Googleyness skills”. •  Beside employees’ usual work, it could be interesting to stimulate, with specific formation courses, entrepreneurial soft skills, in order to take advantage of their innovation potential.

•  The awareness of working in such a company, believing to create value with his employees, should raise the energy and the commitment of the people.
•  As a result of this shared culture, the meaning of trust is increased and people are more likely to share resources.

Keeping Google Entrepreneurial (2)
•  The management should empower employees to motivate them not to give up and to keep on going following their goals.
•  Moreover, an entrepreneurial thinking could be reached by maintaining middle managers flexible and adaptable, to enable them to rapidly react to fast changing scenarios, caused by environmental uncertainity.
•  Furthermore a reward to the most entrepreneurial employees might help people to get involved and to recognize his potential to help both the company and theirselves.

Action Plan (1)
•  In order to avoid excessive bureaucracy, Google should reduce the span of control of each manager and introduce a certain level of empowerment, by hiring additional middle managers.

•  In such a way, it is increased the personal visibility of each and every subordinate due to his personal higher specific weight inside the team.

•  On the other hand, in order not to lose coordination and to protect the consensus philosophy, it would be necessary to increase the number and the variety of mettings.

•  In addition, it might be introduced a new professional figure whose role would be solely the coordination between different parts of the structure matrix.

Action Plan (2)
•  In order to stimulate creativity, Google should highlight its existent tool, which permits to keep track of the personal projects, and continue developing it to be more user-friendly.

•  Beside this, it should also be highlighted the awards given, both managers’ and founders’, leveraging on social relevance and making it worthy and desiderable.

•  Beyond these, it might be introduced an award recognizing the freakiest idea, aiming to encourage ideas generation and risk assumption, stimulating the entrepreneurial attitude of the employees.

•  Finally, it could be fruitful to implement a company social network, where employees can interact both personally and professionally, allowing the optimisation of redundancy of efforts.

Action Plan (3)
•  In order to promote an international consistency, Google should implement a job rotation plan, having employees spending some time in different branches in different contexts.

•  In such a way, Googlers can improve themselves both professionally, increasing their knowledge and competences, and personally,
experiencing radical changes in their lifestyle, touching different cultures.

•  As a consequence, the employees are suggested to maintain close relationships with people they have worked with, living in different countries, and to establish new ones with people they are working with in a virtual environment.