Case 6 Google

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    History

    Development and Growth

    SWOT Analysis

    External Environment Analysis

    Business Level Strategy

    Corporate Level Strategy

    Organizational structure

    Recommendation

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    The first Internet search engine was Archie, Created in1990.

    The Web started to take off after 1993, with the number ofwebsites expanding from 130 to more than 600000, by 1996.

    In 1995, AltaVista appeared as search engine.

    In 1996, Page and Brin developed Google, though it

    formally incorporated on September 7, 1998.

    They were in GoTo.com but separately create the Googleas improved search engine.

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    Growth in Asset:

    Growth in Equity:

    Growth in Net Income:

    2012 2011 2010 2009

    30.6% 42.5% 29.2% 25.4%

    2012 2011 2010 2009

    23.3% 25.7% 28.4% 36%

    2012 2011 2010 2009

    14.48% 10.27% 30.4% 44.8%

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    Google developed Google maps, Google Earth, Google

    mail(Gmail)

    They are developing own Android operating system.

    Developing new Games.

    They are developing Wireless network more smoothly

    than any other firm.

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    Strengths

    Open source products and services

    Quality and customer experience

    are the primary objects

    Financial situation

    Access to the widest group of

    internet users worldwide

    Strong patents portfolio

    Product integration

    Culture of innovation

    Weaknesses

    Relies on one source of

    income

    Unprofitable products

    Patent litigations

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    Opportunities

    Growing number of mobile

    internet users

    Obtaining patents throughacquisitions

    Driverless electronic cars

    Growing into electronics

    industry

    Google fiber cables

    Threats

    Growing number of mobile

    internet users

    Unprofitable productsCompetition from Microsoft

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    Portersfive forces analysis:

    Potential New Entrants

    Bargaining power of Suppliers

    Bargaining power of buyers

    Potential substitutes

    Rivalry among establish company

    PESTEL method:

    Political

    Environmental

    Social

    Technological

    Economical

    Legal

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    Google's Corporate Strategy is to accelerate innovation andstrengthen brand loyalty through transformational changes while

    creating an open-source environment.

    Related Diversification

    Google map, Gmail, Google+, etc

    Unrelated Diversification

    Notebook, Tablets, Mobile- Nexus

    In 2012 Googles acquisition with Motorolas gained a

    strong advantage over its competitors.

    Strategic Alliances

    2005 AOL

    2006 Fox Interactive

    Mid 2006 Dell Computer

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    Google currently pursues the generic business level strategyof differentiation.

    The 4E's of Google Strategy:

    Earn

    Entice and defend

    Expand the pie

    Experiment

    Organize the worlds information and make it universally

    acceptable and useful

    Focuson the user all else will follow

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    Google has a flat organization system.

    November 2005, Google had 1 manager for every 20 line

    employees.

    In recent time ratio is 1:40

    Google have the tendency to create small teams for big

    projects.

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    Liquidity Ratio

    Profitability Ratio

    2012 2011 2010 2009

    Current ratio 422% 592% 416% 1062%

    Quick ratio 418% 592% 416% 1062%

    Cash ratio 335% 501% 350% 891%

    2012 2011 2010 2009

    Gross margin 59% 65% 64% 63%

    Operating margin 25% 31% 35% 35%

    Pre-Tax margin 27% 33% 37% 35%

    Profit margin 21% 26% 29% 28%

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    Growing into electronics industry

    Growing number of mobile internet users

    Google fiber cables