1. Leading Strategic Decision – Making
Google Case Study
A. Analysis
In the following presentation, I’ll attempt to analyze Google’s corporate level strategy,
approaching the SM process and the strategic decisions taken within the organization,
identifying how the following four stages are applied: setting the long term direction,

2. conducting a strategic position analysis, selecting strategic choices and implementing
these strategy choices through strategic actions.
The Ashrigde mission context / definition, is the model which will be used to evaluate
Google’s current mission:
“To Organize the world’s information, and make it universally accessible and useful.”
The purpose
 What is the company for, what are the company’s business principles, what are
the company’s statements of purpose, for whose benefit is all the effort being
put in?
 Company’s combined commitment to its stakeholders, shareholders, and a
purpose aimed at a higher ideal, its mission statement.
The Strategy
The strategy which explains how the company’s purpose will be achieved in competition
with its rivals (competitive position / advantage and distinctive competence). Google’s
strategy as a commercial rational (left brain logic) and the principles around which the
organization will achieve its ambitious goals.
Behavior Standards
The conversion of Google’s purpose and strategy into actionable policies and standards.
As an example we evaluate the collaboration, cooperation and structure in diversified
assignments, development projects, between teams and peers (recognizing each other’s
skills and achievements).
We’ll also observe that in order to capture the emotional energy of the organization, the
mission needs to provide some ideal or moral rationale for behavior to run alongside
the commercial rationale (strategy), emotional and moral (right brain logic).
Values
The corporate values of the organization, how are compared to those of employees
personal values, and how those beliefs and moral principles give meaning to behavior
standards to Google and act as the “right brain” of the company. Strategy and values

3. constitute the left and right brain of Google’s mission, and purpose is linked with norms
and behavior standards via strategy and values.
Google’s definition of mission includes both these rationales linked together by a
common purpose.
-How emotional attachment and commitment (sense of mission) of employees to the
company is achieved?: Attracting, recruiting and keeping high quality committed
employees, with compatible values, Google fosters to a sense of mission.
Transformational, Creative leadership in Google involves novelty and newness, fresh
and unfamiliar ways in achieving opportunities, helping constituents deal with the often
perplexing challenge, creative and cooperative ways of problem-solving.
B. Evaluation of Google’s missionandhow it achieves asense of mission
throughits approach toleadershipandmanagement.
Google is an organization known as famously unstructured with a unique style of
operation, and a CEO stating “we don’t really have a five year plan, and our strategy is
based on trial and error”.
Google is unusual, organized from the bottom up, approaching novelty their way,
focusing on what’s new, exciting, and how can you win with your new idea.
Founders Lary page and Sergey Bin, from the company’s incorporation to IPO… to set its
governance structure with a two-tier board of directors, and from then to 2013,
followed an unusual route.
Their intention was to increase their managerial freedom, and they informed
accordingly, with an open letter, their shareholders, that Google was not a conventional
company and that they did not intend to become one.
Managing the company the Google way, they hired Eric Smidt, an already successful
CEO, from Novell Inc. and shared management at the top, Smidt dealt with
administration and investors whilst Page mainly focused to social structure and Bin with
the area of ethics.
It is obvious from the very beginning, that the characteristics of their management style,
are those of transformational leadership, striving for fresh & unfamiliar ways to achieve
goals, such as their guiding principle in acquisition: “if you can’t innovate something in-
house buy it”. This is in contrast to Apple, for example, who seek to innovate in-house.

4. Created novel and new paths of developing products, launching part-finished products,
letting Google fanatics find them, experiment them, essentially error- check and de-bug
them, “collaborating” with end users, permiting a significant release control.
Inventing creative and cooperative ways of problem-solving, encouraging the creation of
small autonomous teams, where the produced work is quality assured, using peer
review and support, and not a classical supervision.
Their purpose and aim is to retain the leading position as “King of search” following the
same Mantra, broadcasted in every opportunity by its executives, “To organize the
world’s Information.
Within Google the technology itself is the strategy and strategy is technology.
Their core strategy is all about information, to capture it, record it, analyze it, using the
data of their user and customer groups, applying their internal technical platform, which
is a major part of Google success.
The company has never seen itself as an internet search engine, the mission was clearly
stated, “to organize the world’s information and make it universally accessible and
useful.”
In their IPO brochure have elaborated their intention:
“We serve our users by developing products that enable people to more quickly and
easily find, create and organize information. We place a premium on products that
matter to many people and have the potential to improve their lives, especially in areas
in which our expertise enables us to excel”.
A series of behavior standards have also been created since the incorporation of the
company, transforming purpose and strategy in to actions, hiring their first employees,
acquiring the first assets, hiring a CEO, organizing Google’s way of life within
Googolplex, using creativity and innovation.
In their search to meet the information needs of society, assed opportunities to provide
information, through different media channels, wireless telephony, radio, TV, and video
Games, sources of information beyond third-party websites, Image Search, maps,
academic articles, books, satellite imagery, news,
patent Search, video (YouTube), finance (Google Finance), and other.
In that eye-watering pace expansion, they needed employees, sharing the same mission.
This was achieved through a rigid recruitment processes and criteria.
Engineers must have either a Masters or Doctorate from a leading University and they
must pass through a series of assessment tests and interviews. The result of the above
processes was, to hire and retain a fairly predictable employee population, much easier
to manage, implementing technics, such as psychometric profile of googleness.

5. They continued to create and implement innovative norms and standards: control of
workflow, quality and to a large extent the nature of projects that are under way is
down to employees and not to the management, offering also additional benefits such
as free meals, swimming pool and massages etc..
In fact, the ‘laissez-faire” attitude, toward the management of employees, the peer
review of performance, the small flexible work teams appointing their own leaders, the
freedom of self-initiated project work (allocation of 20% of their work time to personal
projects), the transfer from team to team without prior permission from HR, have had
as a result not only to stimulate innovation and create new knowledge as well as
potential products, but also to create a strong sense of mission, corporate values are
aligned to personal values of employees, and indeed an emotional and deeply personal
feeling is created thanks to Google’s culture and work environment as a whole.
C. Critically assessment of Google’s approachtostrategic decision-making
practicedat Google and its potential transferability toother
organizations.
The organization it’s structured from bottom up, with its employees in all levels playing
an important role in strategy development process.
Google is a dynamic environment where decentralized authority for strategic decisions
is required, and as Garry Hamel identified, indeed, Google is “dramatically flat, radically
decentralized” organization, it’s highly democratic, tightly connected, and flat. The
source of the company’s culture and radical decentralization can be traced back to Brin
and Page, both of whom attended Montessori schools and credit much of their
intellectual independence to that experience.
Within the organization a strategic planning it is designed to work in conjunction with
bottom-up emergent processes of strategy development (emergent strategy),
approximating to the “logical incrementalism” process.
Strategic planning is becoming more project-based and flexible.
As we can clearly see there is a “kind” of “intended strategy” which has been
transformed in strategy emerging from below. On other words the Triumvirate has
deliberately cultivate a bottom-up, experimental basis for strategies to emerge.

6. It is explained, that Google’s management is applying a strategy development by
experimentation and learning (logical incrementalism), by creating small self-managed
teams, where knowledge is readily shared and experimentation is the norm, applying
the rule “70-20-10” which stipulated that Google would devote 70% of its engineering
resources to developing the core business, 20% to extend that core into related areas,
and 10% allocated to fringe ideas.
As a result, Google employees are able to spend a significant amount of their time
working on stipulated projects of their own choosing.
The organization may have an issue to further explore, which is that the engineers
spent more like 30% (based on inside reports) of their time on labor of their own choice,
a lot of invention and creativity but also of chaos.
Progressing incrementally gives Google’s management, the opportunity to gain staff
acceptance and commitment to the strategy, and a sense of mission is also created.
It is clear that strategy results from learning which allows for creativity, interaction and
invention, where internal resources of innovation capabilities are used.
Google is a learning organization, defined by Johnson et al (2011, p. 406) as “an
organization that is capable of continual regeneration from the variety of knowledge,
experience, and skills, within a culture that encourages questioning and challenge”. Says
Mayer: “ Brin and Page understand that breakthroughs come from questioning
assumptions and smashing paradigms.”
Analyzing Google’s rapid growth expansion, some critical points have raised on both,
their strategy formulation as well as their internal controls, procedures and policies. As
lary Page has also mentioned, there is a need to effectively manage their growth, which
as a result has placed significant demands on their management, operational and
financial infrastructure. One of the major issues, is Google’s too many acquisitions, in a
very rapid pace, shifting organization’s efforts from operating its business, to acquisition
integrating challenges.
There is a clear need, Lay Page continuous, “of implementation of new, or remediation
of company’s infrastructure, immediate integration of the acquired company’s
accounting, human resource, and other administrative systems, and coordination of
product, engineering, and sales and marketing functions.”
The strategic decisions which are developed, is the outcome of continuous testing and
experimentation, using the organization’s innovation capabilities, occurring on an on-
going basis, in many cases with rapid, low-cost experimentation, like digitizing the
world’s libraries, by turning book digital photos into digital text, and creating a software
within some days, that could search the book. A simple example of achieved
competitive advantage over its rival competitors.

7. Google faces competition in every aspect of its business, search engines, vertical search
engines and e-commerce websites, Web MD, and Amazon.com and eBay.
Social networks, Facebook and Twitter, mobile applications on iPhone and Android
devices, which allow users to access information directly from a publisher without using
search engines.
The organization is retaining competitive advantage by preventing imitation, building
strategies based in multiple capabilities and innovation, some examples below:
 Highly selective hiring policy, hiring only the brightest of the bright. Because of
their caliber and characteristics, Google is doing exciting work and make a
difference.
 Protecting their intellectual property, and increasing their rich portfolio of
patents by acquiring new companies (recent acquisition of Motorolla), dealing
with threats from competitors armed with their own patents.
 Continuously creating new knowledge, and leverage learning into new innovative
products and services (Android, Chrome, Google+, Google display, TV, Books,
Enterprise etc..) staying ahead of competitors.
Since knowledge and technology (innovation) are protected by patterns, and gained via
experimentation and practice, it is not easily copied by other organizations, or
transferable. In addition the first mover advantage yields sufficient lead time to the
company to stay one step ahead from the competition.
Google’s continuous product launches (Android Chrome web browser, and many
others), as well as the fast growing expansion with the acquisition of new companies
(between its IPO 2004 and 2011, 99 companies have been acquired) gave precedence
over its rival competitors, but on the other hand, these diversifying initiatives had done
little to boost revenue, let alone generate profit.
A major concern of analysts is that Google’s many ambitious Initiatives were adding cost
and distracting management at a time when advertising revenues were being squeezed
by the economic downturn.
Company’s undoubtful success, is the power of its search engine algorithm, the
business model that matches text ads to searches, and the innovative culture of the
organization, developing and delivering high quality products and services.
Over the last years, Google has released high profile products that seem have little or no
relation with its core business, and the identity of the company has become muddled.
With the recent heavy acquisition of Motorola, Google is entering in another field of
competition and many questions about company’s identity and not only, have raised,
what is Google? A web company? A software, a hardware company, or something

8. different. How the company will absorb this new multi-billion $12,5 challenging
Motorola’s acquisition, without decreasing its profit margins.
With the coming of Lary Page as new CEO, a new era in Google’s governance is starting,
it seems he is more product focus, and in association with the “mathematician” Sergey
Brin and the Support, where is needed, of Eric Smidt , it is believed, that the company
will accelerate the procedures to integrate the acquired companies, review its internal
control and policies, as well as its rational corporate strategy and expansion decisions.
D. Conclusion
Google is established in 1997, its transformational leadership has guided the
organization to a sustainable success, becoming profitable in 2001 and public
company in 2004 with a market capitalization of $23 bn. Since then the company has
rapidly expanded, with a financial capacity of $7.9 bn operating cash flow in 2008, and
a cash pile of $15.8 bn. This financial strength allowed Google to buy its way through
acquisition into almost any market or area of technology. Google’s value in 2011 was
$111 billion.
The Triumvirate has successfully adopted an innovative strategic leadership, establishing
a powerful organization, maintaining flexibility, empowering employees, focusing on
achieving commitment to the mission set, through aligning employees values to those of
the organization.
They have established and successfully managed, purpose, strategy, behaviors and
values and as a result a sense of mission has been achieved.
Google implemented innovative strategies, such as “logical incrementalism”, developing
experimentation and organizational learning. The creation of inventive, team based
structures, managed by using non-conventional techniques, and a new mode of
leadership, had as a result to gain competitive advantage over competitors via multiple
innovative capabilities.
The problem is the rapid expansion and into so many different areas, running at a
thousand directions, at the same time, which had as a result, the diversion of
management time and focus from operating the business, to acquisition integrations. In
addition the acquisition of Motorola has two implications, the financial impact of this
huge, risky and distracting move, and the risk to derange the relationships with
Samsung, HTC and other Android partners.

9. On the other hand Google has an opportunity to create a platform that could be used to
better display ads for mobile device users and increase firm’s income.
In conclusion the company has access to the widest group of internet users worldwide,
offers open source quality products and services, possess strong patents portfolio,
inimitable innovation culture, the potential to grow into electronics industry, and is one
of the most profitable companies in the world with strong financial results.
The challenges the company is facing are the unprofitable products, patent litigations,
relying in one source income, US government privacy frameworks, EU antitrust laws,
the increasing strong competition, and the threats less from the market and more from
the government and judicial arenas.
As Google is growing at exponential pace, and the environment is continuously
changing, the Triumvirate has to carefully reconsider the overall strategy of the
company.
Nicolas Frangos.