1. Case study of google inc. (2010)
STRATEGIC MANAGEMENT
Case study of google inc. (2010)

2. GOOGLE INCORPORATION

3. = 1 x 10100

4. Founders:
Larry Page Sergey Brin

5. Mission (at the time of formation)
Creating ultimate search engine to help users tame the unruly and exponentially growing repository of information i.e., internet.

6. Mission (in 2010)
Organize the world’s information and making it universally accessible and useful. Most effective, most profitable way to accomplish mission is to put users first.

7. MISSION STATEMENT (2013)
“Google’s mission is to organize the world’s information and make it universally accessible and useful.”

8. History
Founded : 1998 by Stanford University graduate students Headquarter : US Sector : Technology Services Industry : Internet Software and Services Market Capital : $ Billion

9. Location
More than 70 Offices in 40 Countries

10. Google’s products and services
Search engines
Applications
Clients
Maps
Android

11. Philosophy of google inc.
Focus users
Do 1 thing in best way
Fast is better than slow
Democracy on webworks
No need to be at desk to need answer
There’s always more info
No boarders for information getting
Be serious at work
Great is not good enough

12. COMPETITORS
Yahoo
AOL
Microsoft

13. Market share (2013)

14. Comprehensive Strategy Formulation Framework

15. 3 Stages of Strategy Formulation:
Input Stage
IFE Matrix
EFE Matrix
CPM Matrix
Matching Stage
SWOT
SPACE Matrix
BCG Matrix
IE Matrix
Grand Strategy Matrix
Decision Stage
QSPM

16. Input stage
Input Stage
IFE Matrix
EFE Matrix
SFE Matrix
CPM Matrix

17. Ife matrix (internal factor evaluation)

18. Ife MATRIX Strengths Weights Rates Weighted average
Attention grabbing initial public offering
0.02 3
0.06
Payment of higher returns to investors (than any Co. in S&P 500)
0.03
0.09
Strong brand image among search engines
0.12 4
0.48
global leader in technology
0.24
BOD and Executive members experienced and are from Various tech organizations
0.05
0.2
increase in Google's revenue internationally
0.07
0.28
use of censors according to locations in searches e.g. google.com.pk, google.com.fr
"TechTalks" and "TGIF" meetings to conveys information to employees keeping them satisfied
most relevant results of searches

19. Ife MATRIX Weaknesses 97% of revenue comes from advertisers 0.09 1
Google lacking advanced financial strategies
0.05
users may navigate directly to other well-known databases like amazon, etc.
0.02 2
0.04
Other companies have filed claimes against Google for copyrights infringement
0.03
0.06
has to refund fees charged for fraudulent clicks
IT and communication systems of Google can hinder availability of its products and services
0.08
Excess spendings of Brin and Page and its nomination by Bloomberg Business week as "Executive Excess"
rejection of acquisition offers by other companies due to chances of loss of personal identity
0.12
No significant additional revenues generated by YouTube
2.79

20. EFE MATRIX (External factor evaluation matrix)

21. Weighted average score
Sr. No.
Details
Rating
Weight
Weighted average score
OPPORTUNITIES: 1
Forming of policies to remove cultural barriers for employees 2
0.07
0.14
Controlling of religious abuses on websites can increase views and clicks to specific sits i.e., YouTube
0.03 3
Secure browsing with least chances of viruses and hacks 4
0.1
0.4
Development of Strong corporate culture for attracting expert employees of industry
0.09
0.27 5
Mobile computing is an open, unchartered area
0.3
1.2
THREATS:
Fast pace of innovation and continued growth required in industry
0.2
0.8
Acceptance of internet in colleges and cultural adaptation behavior
0.04
0.12
regulatory issues related to monopolistic power
0.21
copyrights and material filtration laws for children
0.06
Exchange rate risk, negative tax consequences, foreign exchange controls
0.18 6
Due to global recession, it's difficult to maintain and attract talented employees
0.01
TOTAL
3.42

22. SFE Matrix (Strategic factor evaluation)

23. SWOT Weights Rates weighted average score
Strong brand image among search engines (S)
0 .15  4
 0.60
most relevant results of searches (S)
 0.10  3
 0.30
increase in Google's revenue internationally (S)
 0.05  2
global leader in technology (S)
 0.15
97% of revenue comes from advertisers (W)
rejection of acquisition offers by other companies due to chances of loss of personal identity (W)
has to refund fees charged for fraudulent clicks (W)
Mobile computing is an open, unchartered area (O)
Secure browsing with least chances of viruses and hacks (O)
Fast pace of innovation and continued growth required in industry (T)
regulatory issues related to monopolistic power (T)
 1.00
 3.20

24. CPM (Competitive profile matrix)

25. Google AOL Yahoo CPM MATRIX Critical Success Factors 0.10 4 0.4 1 0.1
Weight
Rate
Score
Word of mouth
0.10 4
0.4 1
0.1 3
0.3
Relevant Advertisement
0.05
0.15 2
Online product and service
0.2
Ease of use
Market Capitalization
0.20
0.8
0.6
Number of advertisement member
Earning per share
0.45
Global leader in Technology
0.25
0.5
Total
3.75
1.1
2.4
Yahoo

26. Stage 2: The matching stage

27. Matching Stage
SWOT Matrix
SPACE Matrix
BCG Matrix
IE Matrix
Grand Strategy Matrix

28. Swot matrix

29. Internal factors/External Factors
Strengths
Attention grabbing IPO
Payment of higher return
Strong brand image
Global leader in technology
Experienced team
Increased international revenue
Censored searches
Information meeting for employees
Most relevant searches
Vast product line
Weaknesses
More revenue from advertiser members
Lack of financial strategies
Direct navigation to databases
Copyright infringement claims against google
Fee returns for fraudulent clicks
IT & communication systems of google can hinder performance
Executive spendings increased
Rejection of acquisition offers
Low revenue from youtube
Opportunities
Cultural barriers removal for employees
Controlling religion abusing activities
Secure browsing
Capture mobile browsing SO
developing strong culture for employees to attract experts by ensuring proper communication
8S+1O
mobile computing is an open, unchartered area can go there and increase their product line
10S+4O WO
significant additional revenues will be generated by YouTube if religious abuses are controlled like dailymotion and youtube
3W+2O
Threat
Fast innovation required by industry
Acceptance by educational institutions
Rules for monopolistic powers
Copyright and material filtration
Exchange rates, taxes risks
Difficult to attract talent ST
Fast pace of innovation and continued growth can be achieved by good technological experts team and being global leader in technology
1T+4S
Acceptance of internet in colleges can be achieved through most relevant searches and strong brand image
2T+3S+9S WT
IT and communication systems of Google shouldn't hinder availability of its products and services in order to compete in fast pace of innovation and continued growth required in industry
6W+1T

30. Space matrix

31. Environment stability
Financial strength
Rate
Environment stability
EPS +7
Technological changes -1
Net income +6
Barrier to entry -3
Price earnings ratio
Competitive pressure -6
Price/earnings to growth +4
Ease of exit
Operating margin +5
Risk involved -2
Total
+28
-18
Competitive advantages
Industry strength
Market share
Growth Potential
Product quality
Profit potential
Customer loyalty
Financial stability
Technological know how
Resource utilization
Capacity utilization
Productivity
Capital utilization -7
+37

32. Details Calculation Financial Stability +28/5 = + 5.6
+28/5 = + 5.6
Industrial Strength
+37/6 =
Environmental Analysis
-18/5 = -3.6
Competitive Advantage
-7/5 = -1.4

33. X - Axis = CA+IS
= = 4.76
Y-Axis = FS+ES
= – = 2

34. BCG Matrix (Boston consulting group matrix)

35. Bcg matrix

36. Ie matrix (Internal-External Matrix)

37. IE Matrix
It based on two key dimensions The IFE total weighted scores on X-axis The EFE total weighted scores on Y-axis Divided in to three major reasons Grow and Build- Cells I, II or IV Hold and Maintain - Cells III, V or VII Harvest and Divest – Cells VI, VIII or IX

38. I II III VI IV V VIII IX VII IE Matrix Average Strong Week 2.0 - 2.99
Average
Week
High
3.0 -
3.99 I II
III
Medium
2.0-
2.99 IV V VI
Low
1.0-
1.99
VIII IX
VII

39. IE Matrix
EFE weighted Score = 3.42 IFE weighted Score = 2.79 Grow and Build intensive (market penetration, market development and product development) or integrative ( backward integration, forward integration and horizontal integration)

40. Grand strategy matrix

41. Grand strategy matrix

42. Interpretation:
As Google has a Strong Competitive Position and Continues Market Growth so it can adopt any of the following strategies.
Market development
Market penetration
Product development
Forward integration
Backward integration
Horizontal integration
Concentric diversification

43. Stage 3: decision making stage
QSPM

44. Opportunities Weight Market Penetration Diversification
Product Development AS
TAS
Opportunities
forming of policies to remove cultural barriers for employees
0.07 2
0.14
controlling of religious abuses on websites can increase views and clicks to specific sits i.e, youtube
0.1 3
0.3
Secure browsing with least chances of viruses and hacks
0.09
0.27
Development of Strong corporate culture for attracting expert employees of industry
0.21
mobile computing is an open, unchartered area
0.12 4
0.48

45. Threats
Fast pace of innovation and continued growth required in industry
0.21 4
0.84
Acceptance of internet in colleges and cultural adaptation behavior
0.03 1
regulatory issues related to monopolistic power
0.04 2
0.08
copyrights and material filtration laws for children
0.15 3
0.45
0.3
Exchange rate risk, negative tax consequences, foreign exchange controls
0.16
Due to global recession, it's difficult to maintain and attract talented employees

46. Strengths Attention grabbing initial public offering 0.02
Attention grabbing initial public offering
0.02
Payment of higher returns to investors (than any Co. in S&P 500)
0.08 2
0.16 1
Strong brand image among search engines
0.05 3
0.15
global leader in technology
0.09
0.18
0.27
BOD and management is experienced and from Various tech organizations
0.04
0.12
increase in Google's revenue internationally 4
0.32
use of censors according to locations in searches e.g. google.com.pk, google.com.fr
"TechTalks" and "TGIF" meetings to conveys information to employees keeping them satisfied
most relevant results of searches
Vast product line
0.1

47. Weaknesses 97% of revenue comes from advertisors 0.15 2 0.3 3 0.45 4
97% of revenue comes from advertisors
0.15 2
0.3 3
0.45 4
0.6
Google lacking advanced financial strategies
0.04 1
0.08
0.16
users may navigate directly to other well-known databases like amazon, etc.
0.02
Other companies have filed claimes against Google for copyrights infringement
has to refund fees charged for fraudulent clicks
0.06
0.12
IT and communication systems of Google can hinder availability of its products and services
Excess spendings of Brin and Page and its nomination by Bloomberg Business week as "Executive Excess"
rejection of acquisition offers by other companies due to chances of loss of personal identity
0.01
No significant additional revenues generated by YouTube
4.66
3.8
4.34

48. Conclusion: Market penetration Product development
Both strategies fit with Google but if need only one strategy, the market penetration is the option to be selected