Google Business Strategies Essay
Google Business Strategies
This report provides an analysis of Google’s development of new strategic resources, dynamic capabilities and core competency, Analysis of competency test, Google’s competency foundation to compete in shopping related searches and the positive impacts of Google’s competencies towards its business model. Moreover, this report provides recommendations that Google are effectively able to utilise.
Google, a provider of multiple products and services, with the mission to “organise the world’s information and make it universally accessible and useful”, 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 Google’s competency test, and its impact towards Google business model (Newth, F 2012). Google’s development of new strategicresources, dynamic capabilities and core competency Google’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 Google’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 company’s internal and external organisational skills, resources and functional competences moreover, reviewing the company’s strengths, as a result of adapting to the new change(Newth, F 2012), that is, the re positioning of Google’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 by 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, Google’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 “appendix 1”, 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 Google’s strategic assets, that is, their employees, Google’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 Google’s experienced and knowledgeable employees. Google is the number one best company to work for in America, as voted by the company’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 employee’s work needs in every way possible, Google’s unique employees are also provided with outstanding people management practices, as a result of the company’s use of the people analytics approach. Google training efforts aren’t the usual traditional tactics applied, Google’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 “VIRO test”, to assess whether or not Google’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 employee’s competencies, as here, the 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 company’s issues, processes and outcomes in order to enhance Google’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 Google’s strong brand name. Google’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 2010’s world valuable global brand, close to major competitors such as Microsoft (Interbrand, 2010).
Alongside Google’s significant brand image, Google’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 Google’s strong brand name, as the strong infrastructure base allows Google’s new innovative products to gain a competitive advantage, hence keep its strong brand name visible(McDermott, T) . Moreover, like Google’s employees, the company’s strong brand name lies within similar VIRO test characteristics, such as , Valuable, rare and Imitability. Alongside these characteristics, Google’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. Google’s dynamic capabilities in this case, refers to the company’s strong customers based brand equity and Google’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 Google’s brand resonance, for instance, Google’s search advertising has created a better fit between meeting potential customers’ needs and the relevant advisement. Hence focusing on these attributes has allowed Google to add these as one of their strengths towards the overall company (T. Y. Chan, C. Wu, Y. Xie 2011).
Furthermore, Google’s loyal customer base VIRO test characteristics as presented in table one, makes Google’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). Google’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).
Google’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 Google’s online shopping transition to an all paid model, Google believes “that by having a paid relationship, it can better ensure the quality of what it lists in Google shopping” (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, they’re able to increase traffic to retailers in order for shoppers to easily find their sites (Sullivan, D 2012).
The positive impacts of Google’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 proper mechanisms and competencies to compete, it brings alongside it positive impacts towards Google’s business model. The positive impact of employee competencies at Google, include the positive attributes Google employee’s pose such as strategically working on intrinsic challenges on a daily bases, effectively gathering and processing appropriate information to further enhance Google’s culture of innovation , having a rather unique business perspective and resource management have greatly impacted the company’s business model (Sullivan, J 2007).
Moreover, Google’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 company’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 company’s strong brand name also has a positive impact towards Google’s business model, as Google’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).
Google’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, Google’s strong brand names, and its competitive advantages such as the competencies as mentioned above, play an important role in positively impacting the company’s business model. Similarly, like competencies from knowledgeable and experienced employees, and the company’s strong brand name, Google’s loyal customer base also has a positive impact.
Google’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 Google’s product lines and services, if they are able to be correctly executed, such as Google’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 Google’s loyal base, in the long term, this largely impacts Google’s overall company’s business model, as this competency has created a competitive advantage (T. Y. Chan, C. Wu, Y. Xie 2011) that even though other search engine company’s may be successful, Google is still deemed as the most popular and most chosen by its users.
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 company’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 employee’s competencies and re adjust some aspects, so employees are able to effectively execute any task given, in order to keep Google’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 Google’s unique business model. In turn, this will result in a competitive advantage that Google will be able to override its competitors.
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 Google’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 Google’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.
In conclusion, it is evident that Google has positive competencies to contribute to the company’s business model, as a result of Google’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.
Bhasin, K 2011, “The 20 Brands -The Most Loyal Customers”, Viewed 24th March 2014, < http://www.businessinsider.com.au/brand-loyalty-customers-2011-9?op=1 > .
Hartwig, J. I 2012, “Google Shopping: Preparing for Paid Listings” Viewed 5th April 2014, .
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