keeping google googley. harvard case

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Keeping Google “Googley”

By:
M. Bertaccini, L. Dovesi,
G. Nicolini, M. Olivieri,
MC. Penna, M. Perini.

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:
Ø 
Ø 
Ø 
Ø 
Ø 
Ø 

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:

Ø 
Ø 
Ø 
Ø 

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...
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