A Case Study About Google Essay

DECLARATIONThe work contained in this denomination is my confess and that in either materials and sources exampled lead been acknowledged. I/We have not copied or colluded in part or in whole, or some otherwise lift the work of other students. This assignment has not been submitted for previous assessment in any other subject or to a substantial termination has been accepted for the award of any other unit, module, degree or parchment of a university or any other institute, except where ascribable realization is made in the text. I/We confirm that I/we have read, understood and followed the guidelines for assignment sub missionary work and presentation provided by the lecturer. I/We understand that this assignment may be accept on the database and physical exertiond to make comparisons with other assignments in future. I/We have made a copy of my assignmentThis work may be photocopied and/or communicated for the purpose of identifying plagiarism. I/We leaping permis sion for a copy of this marked assignment to be retained by the faculty of Business Management for the purpose of course reviews by external examiners and to be used as a resource by Majan College. I/We understand that unauthorized late submission without a valid written extension will be marked as per the college form _or_ system of government menti matchlessd in the students handbook page 18 section 18.5.IntroductionGoogle was founded in 1995 by Larry Page and Sergey Brin and it was the first popular hunting locomotive in the human. They created this essay engine so that users mint find any website or document on the web based on keyword or little searches. Google provides free function for their users. Other than the search engine, they can also search books on Google Book appear, news on Google News, videos on Google Video (YouTube) and maps on Google MapsGoogle has changed the way people look at and shargon culture. This has made them a leading search engine on the w eb and a spherical technology leader. Back in the mid 90s Brin and Page, Stanford University graduates, worked on burgeon forthing this unique technology. Since then, Google has grown to become one of the approximately know checks in the world as headspring as one of the tallness Internet destinations. As of 2013, Google has 16800 employees working in much than than 70 offices in to a greater extent(prenominal) than 40 countries somewhat the globe. Their headquarters is located in ken View, California, USA. St targetgic focusing has many benefits to an organization. A follows vision, mission and future goals be set from the st rategic c be for. In addition, strategic vigilance gives managers an advantage in allocating resources efficiently.Moreover, these strategies help give the firm a competitory advantage in the foodstuff. Statistics show that, on average, companies using strategic management atomic go 18 more successful. This assignment will aim to clarify the innovation of strategic management in the spherical sense as well as focus on Googles strategic management. In addition, the notify will identify and explain the native and external purlieual abbreviation of Google. This means, PEST analysis, SWOT analysis and Porters Five Forces will be explained in details.Literature ReviewStrategic management is defined as the process by which managers of the firm lose it the cozy and external environments for the purpose of formulating strategies and allocating resources to develop a competitive advantage in an industry that allows for the successful feat of organizational goals. Strategic management has an impact on initial goals, actions and recourses. Goals be set by managers to be completed within a received period of time. Action plans must be clear to the group and they should go working on their targets accordingly. Recourses cannot be managed and allocated without proper understanding of goals and actions. Strategic d ecisions atomic number 18 occupyn by managers to help an organization reach its goals in the fiddling term and coherent term development and future direction of the company. in that location are two processes that help the organization in evaluating their position in the trade. Internal environment i.e. SWOT analysis (Strengths, weaknesses, opportunities and panics) is used to analyze the internal processes and structures of a business.Its implemented after the external environment (PEST analysis) are canvass and clarified. External environment processes include the porters flipper forces that analyze the nature and extent of the competition within the industry. Macro environment are the changes in the industry in regards to political-legal, economic, scientific, and social systems. Googles business strategy has been proven to show that they follow the strategic management process and they are extremely successful at it. High brand value, high market share and complete co ntrol over the market show that Googles business strategy should be a role model to all other companies.PEST compend of Google Inc.PEST analysis is used to set up the political, economical, social and technological brokers in an external environment of an organization. These factors affect an organizations activities and performances. after researching Googles macro economical factors using the PEST analysis model, the sideline was concluded1. Political FactorsGovernment stability is one of the major(ip) aspects in Googles strategy. If the market is abiding, governments help businesses and so these businesses advertise more on Google, hence, benefitting Google. In addition, most of the governments do not have identified laws for online randomness sharing, thus, giving Google the opportunity to manipulate laws. However, mainland mainland China has created a barrier for Google by adding regulations that forbid Google from operating on their terms. For example, according to U Kessays (2013), Chinese Government launched a surveillance system called Golden Shield for monitoring civilian use of Internet. On a positive note, most of the political factors affect Google negligibly. more or less of these factors are taxation polices, employment laws and environment protection laws.2. Economic Factors make domestic products (GDP) have been on the rise since a really long time. They are increasing annually at the average rate of 3.20% stretchability a high level of 17.20% at times. Countries ilk South Africa, India, China and United Kingdom have had increases in their GDP each social class since the 70s and this is a positive factor on Google. With the stcapable and continued growth of those countries, Googles internal and external investments will evermore be high in numbers. Users search more hence more advertisements are put on Googles search engines. The amount of users around those counters can impact on Google positively and lead them to establish di scontinue services and more products for their users leading the it creation a strength to Google economically. provoke rate can have a positive or controvert impact on any organization. These impacts are decided depending on a companys dealings. Google is a company that relies on investments, this means when avocation rates increase gradually in a country, Google benefits. In UK, the rate average is set to more or less 8.2%, in USA it stands at 6.1%, in South Africa at 13.3%, in India at 6.6% and in China at 6.4%.These numbers mean that companies in that region of the world will be able to take out loans and invest or mount their company. The more companies have money, the more they will be willing to spend on advertisements hence doing that through Google. This increases opportunities for Google in these markets. Inflation rate is a fuss for the customers or buyers. However, companies benefit from it and it increases their overall income. In the past few years, USA, UK, In dia, China and South Africa have all recorded an average increase in inflation rate of 2.5-9.5% annually. This means that raw materials in these countries are decorous more expensive every year. This causes the companies to increase the prices of their products and getting more immediate payment out of it. This causes Googles advertisements to increase as well as the number of clicks for each ad. The result is more profits for Google from these countries.3. Technological FactorsIn analyzing the technological factors affecting Google, the key aspects to consider are the level of basic theme, rate of technological change, new discoveries and development, government spending on research, portal to newest technology, technology incentives and technology legislations. Google is described as a technological company that helps preface and improve the world with its new development. Technological factors play a major role in a company like Google and it is part of the companys com petitive strategy. Google is not entirely a search engine it also provides many services, tools and products free of charge through www.google.com. Googles IT infrastructure is a closely guarded secret because it is one of the companys competitive advantages. Google has up to 450,000 servers spreads over at least 25 locations and it uses a customized version of Linux operating systems to give them control and flexibility in finding new discoveries.The success of Google is mainly due to its innovative concepts and technologies such as Pagerank in their search engine, Adwords as advertising system, AdSense program, Gmail, Google Spreadsheets & Docs, Google Map, Google Froogle, Google Analytics, Google Desktop, Google Earth, Google Gear, Google Page creator, Google groups, Google talk, Picasa and more. completely these services and tools are proposed for free with the aim to make a users emotional state easier, efficient, practical and entertaining. In order to remain the best i n the national of technology, Google has bought a great number of start-up companies (131) that allows it to benefit from the dynamism and creativity that these companies bring. These companies contrive in variety of fields such as security, advertising, video, file sharing, shopping, quick technology and many more.4. Socio-Cultural FactorsKnowledge and discipline is a key factor of human development. Google is a leader of society that is more and more spheric because its mission is to organize the worlds teaching and make it universally accessible and useful to everyone. Socio-cultural factors for Googles PEST analysis include usages, values, social trends, and society expectation of businesses. These society expectations can be grouped into state demographic, income distri neverthelession, lifestyle change and level of education. Google is not limited to a reliable demographic population Google is a global company that offers global users with global services and gl obal knowledge for free with only one stipulate of cosmos connected to the Internet. Therefore there is no restriction on any specific demographic, culture or specific income distribution. This gives Google a very unanimous advantage in the market. Its tools are offered to everyone and hence anyone, anywhere in the world can advertise on Google and increase their profits. Majority of thirdly world countries that are prevailing with extreme poverty have access to Google through their mobile applications. Googles culture is to offer users access to the world through a simple finger tap and this information offered by Google does not have a culture or a tradition to follow. This information can be good and helpful to one somebody era useless or offensive to others.This could be a veto aspect for Google. Google always strive to keep up with the social trends and lifestyle changes of its users in order to entertain and capture their attention with its services and tools while promo ting customized advertisement. Googles infrastructure is built to identifying its users trends and habits as well as the use of information to customize their search experiences with related results based on their habits and history. Googles application memorizes all the data entered when searching for a something and saves personal information for 24 months. In reality, Google sells some information to advertising companies. Globalization of information has a negative impact on societies concerned about protect their private data. Google has been highly criticized by Privacy International Association and charge of harmful acts towards peoples privacy.In the sense of politics, the preservation of information could lead to Google having better relationships with countries who do not like their privacy being violated hence, more business and profits. In regards to social factors, Googles magnetic inclination to sell out their customers may harm some of them. At the moment, Google is surviving, but the human race is ever changing and if people are judge the privacy violation now, they might not in the future. This could be a threat leading to a weakness in the future. Porters Five Forces for Google Inc.Porters five forces is a key model when trying to determine an organizations opportunities and threats. It is considered to be a tool when trying to analyze a companys microeconomics. This is the internal affair related to an organization. The competition and violence an organization has or can have in an industry. Porters five forces are heavily used when individual wants to buy a company and needs to understand the market in which the company operates.Supplier PowerIn this case, Google has an advantage as it operates regionally and has more than one supplier, if the relationship with one deteriorates the other can take its place. In addition, Google has eliminated competition by gaining the trust of Microsoft. all in all its tools are operated on its bi ggest competitor Microsoft systems. However, Microsoft and Apple could change their operating systems so that it does not support Google anymore leading to Google tools not working properly and causing a threat of forward desegregation. In this case, is it concluded that the supplier power is relatively low due to most of the information on the net being free.Barriers to EntryNiu, Zitong et al. (2012) defines the threats by explaining that in the search engine business, only hardware have switching costs while the service itself has absolutely no switch cost. In addition, Yahoo and Microsoft could stop using Googles toolbars in their products and rather use their own. This and the fact that a better search engine could be developed and is not out of the question. However, all these negative aspects silence do not change the high barriers to entry as all competitors in the market, especially Google, are in a very strong position financially.Competitive RivalryIn this type of riva lry, Zitong et al. (2012) mentions that brand personal identity can play a huge role in maximise profits. Google has succeeded in this as their name Google has been added in dictionaries. Adding to advantages of Google, there are no defined government regulations as of yet and so political environment can easily be manipulated to satisfy their wants. Yahoo and Microsoft are the only other major players and market shareholders. Hence, there is a rivalry betwixt these three players. However, the UN or countries could start making trade restrictions to avoid having an oligarchy. Moreover, rivals in the search engine industry have identical technology and IT specialists in these companies and all around the world are always trying to improve search engine technologies in order to get ahead of the best, Google. holy terror of SubstitutesNo switch costs and buyers preferences to the faster/more accurate search engines are two of the threats Google face. In addition, users are dema nding more and better services for free to be loyal to Google. Advertisement taxations depend completely on number of clicks on a certain ad. If the number of loyal customers decreases, the sum up revenue decreases. Moreover, intelligent employees are rare in the market and losing one to the competition could affect Google negatively. However, these are all threats that are not able to affect Google because as of now all search engines have similar functions and are not considered a substitute product.Buyers PowerAccording to Techwyse (2013), Google are the market shareholders. The pie chart below shows the market share as of July 2013. represent 1 Search Engines Market Share/2011The graph shows that Google have more than 75% of the market. In addition, Google is bringing to their users all their demands and for free. In this situation, however, the buying power is medium due to high demand on search engines and due to users relying heavily on search engines in their daily lives. SWOT Analysis of Google Inc.StrengthsGoogles brand value stands at $55.317 million as of 2012 and they hold a high market share of 66% in the uniform year. These numbers, along with their various free services offered to customers, gives them a strong brand image that contributes to its strength. Googles Strong financial position is shown in their yearly growth in revenues and cash flow. This strengthens Google because it attracts investors to invest in the organization. In addition, they have many products that are also considered as an asset. The following graph shows the revenue growth of Google between 2003 and 2007Graph 2 Googles Revenue harvest-homeWeaknessesOn the other hand, in 2012 97% of Googles revenues come from Advertisement. The leave out of income diversification is considered as a weakness. Moreover, Googles faces many lawsuits and the cost of dealing with those suits is a weakness. Oracle filed copyright infringement in 2010 and MastersObjects vs. Google in 2 011 are some of these suits. These cause a decresase in the financial power of Google as well as reduce firm value.OpportunitiesGoogle practices forward and backward integration of companies. This means that Google buys out and adds companies to their portfolio. In 2011 alone, the added companies stand at around 25. Also, Google has a huge opportunity of taking over the mobile advertisement market and they have already started by buying out Motorola Mobility.ThreatsThe high military capability of competition from Yahoo, Microsoft as well as traditional advertisement agencies like TV, radio and newspapers is considered as a threat to Google. In addition, Google could face the threat of being out casted by countries due to privacy issues.ConclusionAll in all, Google has won countless awards, has maximized on profits, improved services, introduced new developments, eliminated most of the competition and dealt with their weaknesses. It is safe to say that Googles business strategy is civilise but has come out with fruitful results. Although the world is not perfect, Google has more strengths and opportunities than threats and weaknesses. This is even proven on the Internet as someone has joked about Google by saying Only thing Google has failed to do, so far, is fail. (N/A)ReferencesBlatstein, I.M. 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