Wednesday, October 23, 2019
Google Business Strategies Essay
Executive Summary This report provides an analysis of Googleââ¬â¢s development of new strategic resources, dynamic capabilities and core competency, Analysis of competency test, Googleââ¬â¢s competency foundation to compete in shopping related searches and the positive impacts of Googleââ¬â¢s competencies towards its business model. Moreover, this report provides recommendations that Google are effectively able to utilise. Introduction Google, a provider of multiple products and services, with the mission to ââ¬Å"organise the worldââ¬â¢s information and make it universally accessible and usefulâ⬠, is the number one web search engine. Additionally, Google has an old online shopping service site whose rivals include Amazon and eBay (Newth, F 2012). However, recently, in 2012, Google announced its adaption of a new paid model, where retailers were now starting to get charged. Moreover, the bases discussed throughout the report will be grounded in Googleââ¬â¢s competency test, and its impact towards Google business model (Newth, F 2012). Googleââ¬â¢s development of new strategicresources, dynamic capabilities and core competency Googleââ¬â¢s recent change of passing on costs, a fee, to online retailers who display their products on the Google online shopping site (Hartwig, J. I 2012), will require Google to develop new strategic resources, dynamic capabilities and a core competency. Firstly, developing new strategic resources to work aside Googleââ¬â¢s new paid model (Hartwig, J. I 2012), will mean that Google will need to improvise on teaching Google employees currently working in the Google online shopping sector, to adapt to the new changes appropriately, through being educationally mentored on new policies, procedures and most importantly, advancing this new process in a sustainable way (Sullivan, J 2007). Moving on to the development of dynamic capabilities, here, Google will need to effectively make changes towards the companyââ¬â¢s internal and external organisational skills, resources and functional competences moreover, reviewing the companyââ¬â¢s strengths, as a result of adapting to the new change(Newth, F 2012), that is, the re positioning of Googleââ¬â¢s online shopping paid model. This is a crucial change to develop, as vice president of product management for Google shopping, Sameer Samat, explained that byà repositioning to an all-paid model will increase further trustworthy data(Sullivan, D 2012) , hence, it will greater improve the shopping search experience for its customers. Additionally, Googleââ¬â¢s core competencies have already created various competitive advantages for the company, and as a result, Google will need to review their most valuable competitive advantage, and put emphasis on those advantages they have over other similar companies, such as Amazon who provides an online shopping service (Sullivan, D 2012). Analysis of competency test Referring to ââ¬Å"appendix 1â⬠, a competency test of Google was completed, and is now going to be further analysed. Additionally, the competency test as completed was based around three of Googleââ¬â¢s strategic assets, that is, their employees, Googleââ¬â¢s strong brand name and their loyal customer base. It should also be noted that the analysis for the business model impact will be discussed further in the report. The first strategic asset discussed is Googleââ¬â¢s experienced and knowledgeable employees. Google is the number one best company to work for in America, as voted by the companyââ¬â¢s very own employees (Sullivan, J 2007). Alongside this, Google acknowledges its employees by offering employees everything they need to get them focused on specific aspects such as creativity and innovation. Google also focuses on helping their employees have the correct information and resources in regards to their work (Sullivan, J 2007). Moving on, whilst providing to the employeeââ¬â¢s work needs in every way possible, Googleââ¬â¢s unique employees are also provided with outstanding people management practices, as a result of the companyââ¬â¢s use of the people analytics approach. Google training efforts arenââ¬â¢t the usual traditional tactics applied, Googleââ¬â¢s development efforts are decentralized meaning Google employees demonstrate self directed learning (Sullivan, J 2007). Along with self directed learning employees also demonstrate, continuous learning and development, and adapting to changes when needed, are key features that can be direct parallel to the core employee competencies at Google (Sullivan, J 2013). Moreover, when undergoing a ââ¬Å"VIRO testâ⬠, to assess whether or not Googleââ¬â¢s employee dynamic capabilities can become a competency, as presented, Google employees pose three of the four characteristics; valuable, organisation and rare. These characteristics are related to the employeeââ¬â¢s competencies, as here, theà main employees competencies include, information and gathering, where employees are able to locate and collect data from a variety of sources, whilst also analysing the data in order to prepare it into meaningful reports (Sullivan, J 2013). Another competency is business perspective, whereby employees use an understanding of the companyââ¬â¢s issues, processes and outcomes in order to enhance Googleââ¬â¢s overall business performance. Additionally, Google employees manage important resources such as financial information, in order to achieve short and long term goals (Sullivan, J 2007). Moving on, the next strategic asset is Googleââ¬â¢s strong brand name. Googleââ¬â¢s brand name is one of the most recognised brand names globally, and is one of the leaders in internet brands. In 2010, Google for the fourth time was presented as 2010ââ¬â¢s world valuable global brand, close to major competitors such as Microsoft (Interbrand, 2010). Alongside Googleââ¬â¢s significant brand image, Googleââ¬â¢s strong infrastructure base, another dynamic capability, is the base for providing new and advanced innovative products and services to end users; that is consumers (McDermott, T). Here, the company brand name plays a rather large role to add to Googleââ¬â¢s strong brand name, as the strong infrastructure base allows Googleââ¬â¢s new innovative products to gain a competitive advantage, hence keep its strong brand name visible(McDermott, T) . Moreover, like Googleââ¬â¢s employees, the companyââ¬â¢s strong brand name lies within similar VIRO test characteristics, such as , Valuable, rare and Imitability. Alongside these characteristics, Googleââ¬â¢s strong brand name competencies as presented in table one, have given Google the opportunity to enter in a wide variety of markets, and has produced a competitive advantage, as well as, making Google profitable for the company in both short and long terms(Tsai, M 2011). Additionally the last strategic asset for Google is loyal customer base. Googleââ¬â¢s dynamic capabilities in this case, refers to the companyââ¬â¢s strong customers based brand equity and Googleââ¬â¢s ability to create outstanding customer value. Starting with customer based brand equity, here Google utilises its customer brand loyalty which is attached to many benefits for the company such as greater brand loyalty from users and an increase in Google usage (Bhasin, K 2011), just to name a few. Here, Google is able to command for increased price premiums and receive additional trade cooperation and support. To add, customer value and customer brand relationships are the foundation of Googleââ¬â¢s brandà resonance, for instance, Googleââ¬â¢s search advertising has created a better fit between meeting potential customersââ¬â¢ needs and the relevant advisement. Hence focusing on these attributes has allowed Google to add these as one of their strengths towards the o verall company (T. Y. Chan, C. Wu, Y. Xie 2011). Furthermore, Googleââ¬â¢s loyal customer base VIRO test characteristics as presented in table one, makes Googleââ¬â¢s capability a true competency. In regards to this, the main reason it could be drawn upon that Google has a loyal customer base is through its ratings (Bhasin, K 2011). This can be seen through Google standing out as one of the top search engine for users, hence the reason for such a large customer base, whilst beating Bing and Yahoo, other competitors in the same category (Bhasin, K 2011). Googleââ¬â¢s competency foundation to compete in shopping related searches An analysis of the competency test derives favourable outcomes for Google to more effectively compete in shopping related searches. Considering the fact that Google already has a highly established reputation, it sets itself as the most used search engine for users, hence allowing Google to better compete in online shopping (Bhasin, K 2011). Googleââ¬â¢s high consumer awareness, strong market position and core employee competencies further contribute to their competitive advantages, resulting in a higher chance of shopping-related searches. Referring to Googleââ¬â¢s online shopping transition to an all paid model, Google believes ââ¬Å"that by having a paid relationship, it can better ensure the quality of what it lists in Google shoppingâ⬠(Sullivan, D 2012). To add, Google also believes that it will provide more trustworthy information, which improves the shopping online search experience for both retailers and customers (Sullivan, D 2012). Overall, Google has the ability to utilise its competencies and competitive advantages in providing users with more out of their search engine, by working on making it easier for users to search and compare products whilst shopping online. In addition, by assisting shoppers to locate the best deals, theyââ¬â¢re able to increase traffic to retailers in order for shoppe rs to easily find their sites (Sullivan, D 2012). The positive impacts of Googleââ¬â¢s competencies towards its business model Furthermore, as mentioned above, Google has the proper competency base to effectively compete in shopping related searches. As Google has the properà mechanisms and competencies to compete, it brings alongside it positive impacts towards Googleââ¬â¢s business model. The positive impact of employee competencies at Google, include the positive attributes Google employeeââ¬â¢s pose such as strategically working on intrinsic challenges on a daily bases, effectively gathering and processing appropriate information to further enhance Googleââ¬â¢s culture of innovation , having a rather unique business perspective and resource management have greatly impacted the companyââ¬â¢s business model (Sullivan, J 2007). Moreover, Googleââ¬â¢s strong focus on human capital and retention (Sullivan, J 2007), overtime, has given employees the opportunity to make a positive business impact towards the companyââ¬â¢s overall business model, such as their ability to execute their move into online shopping, whilst competing with other large online shopping companied such as EBay and Amazon. Moving along, like Google employees, the companyââ¬â¢s strong brand name also has a positive impact towards Googleââ¬â¢s business model, as Googleââ¬â¢s strong market position allows Google to be innovative with its offering products and services, which in the long term adds value for the company, through increased sales (T. Y. Chan, C. Wu, Y. Xie 2011). Googleââ¬â¢s outstanding recognition, through high consumer awareness, allows the company for more opportunities to seek, such as still being an effective competitor in the online shopping sector, though previous changes were put into place (Sullivan, D 2012). Overall, Googleââ¬â¢s strong brand names, and its competitive advantages such as the competencies as mentioned above, play an important role in positively impacting the companyââ¬â¢s business model. Similarly, like competencies from knowledgeable and experienced employees, and the companyââ¬â¢s strong brand name, Googleââ¬â¢s loyal customer base also has a positive impact. Googleââ¬â¢s recognition as the top search engine for online users (Interbrand, 2010) gives Google the opportunity for expansion, as its built customer base are more likely to become a continuous user of Googleââ¬â¢s product lines and services, if they are able to be correctly executed, such as Googleââ¬â¢s online shopping changes, that even though there were speculations (Morphy, E 2014), once placed into action, it was a more effective way for users to and retailers to sell and buy products. Whilst creating value from Googleââ¬â¢s loyal base, in the long term, this largely impacts Googleââ¬â¢s overall companyââ¬â¢s business model, as this competency has created a competitive advantage (T. Y. Chan, C. Wu, Y. Xieà 2011) that even though other search engine companyââ¬â¢s may be successful, Google is still deemed as the most popular and most chosen by its users. Recommendations Presented, are recommendations Google should effectively consider and utilise in order to stay competent, meet to its consumers need and moreover keep an overall positive impact towards the companyââ¬â¢s business model. Google is grounded in its culture of innovation; however, with the increase of competition, Google will need to overcome this challenge. In order to preserve its culture of innovation as they grow, it is highly recommended that Google overlooks its employeeââ¬â¢s competencies and re adjust some aspects, so employees are able to effectively execute any task given, in order to keep Googleââ¬â¢s innovations unique, and superior (Morphy, E 2014). Google should utilise appropriate dynamic processes that result in capabilities that adds to the strength of the company, in order to develop strong and positive competencies that support Googleââ¬â¢s unique business model. In turn, this will result in a competitive advantage that Google will be able to override its c ompetitors. Moving along, in order to compete with competitors in the online shopping sector, such as Amazon and eBay, Google will need to effectively build onto its dynamic capabilities, by critically reviewing the strengths of their strategic assets, such as Googleââ¬â¢s strong name (McDermott, T). This can be done through promotional strategies and the correct use of their enormous brand recognition in order to allow Google to make smart investments in terms of their retail efforts. Moreover, in regards to the Google online shopping site, in order to terminate speculation (Owen, V 2013) with Googleââ¬â¢s customer base, Google should provide search results that are in the best interest of consumers shopping online, not provide customised search results that only work in the best interest of retailers and advertisers. Conclusion In conclusion, it is evident that Google has positive competencies to contribute to the companyââ¬â¢s business model, as a result of Googleââ¬â¢s strategic assets, dynamic capabilities and its competitive advantages. Moreover, this has allowed Google to maintain its strengths, whilst allowing for greater opportunities for growth and expansion. References Bhasin, K 2011, ââ¬Å"The 20 Brands -The Most Loyal Customersâ⬠, Viewed 24th March 2014, < http://www.businessinsider.com.au/brand-loyalty-customers-2011-9?op=1 > . Hartwig, J. I 2012, ââ¬Å"Google Shopping: Preparing for Paid Listingsâ⬠Viewed 5th April 2014, . Interbrand 2010, ââ¬Å"Interbrand Releases 11th Annual Ranking Of The 100 Best Global Brandsâ⬠, viewed 20th March 2014, McDermott, T, 2004, ââ¬Å"Defining Googleâ⬠, Viewed 18 March 2014, . Morphy, E 2014, ââ¬Å"Google Can Handle Data, But Can It Handle Actual Shoppers?â⬠, Viewed 28th March 2014, Newth, F 2012 ââ¬Å"Strategic Management and Business Models: A Modular Approachâ⬠, Business Expert Press, 1st edition, pp.80. Owen, V 2013, ââ¬Å"Sellers Hit By Google Chargersâ⬠, Daily Mail, United Kingdom. Sullivan, D 2012, ââ¬Å"Google Product Search to Become Google Shopping, Use Pay-To-Play Modelâ⬠Viewed 20th March 2014, Sullivan, J 2007, ââ¬Å"Googleâ⬠, Journal of Workforce Management, vol.86, issue 20, pp.42. Sullivan, J 2013, ââ¬Å"How Google Is Using People Analytics to Completely Reinvent HRâ⬠, Viewed on March 25th 2014, < http://www.tlnt.com/2013/02/26/how-google-is-using-people-analytics-to-completely-reinvent-hr/ >. T. Y. Chan, C. Wu, Y. Xie 2011, ââ¬Å"Measuring the Lifetime Value of Customers Acquired from Google Search Advertisingâ⬠Marketing Science, vol.30, issue 5, pp.837-850. Tsai, M 2011, ââ¬Å" A Grounded Theory Study On The Business Model Structure Of Googleâ⬠, International Journal Of Electronic Business Management, vol.9, issue 3, pp.231-242.
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