Business Management: Google Competitive Advantage - Essay Example

Google Competitive Advantage Google Competitive Advantage Google has emerged from a search engine giant to a leadingorganization in multiple categories within the technology sector. The organization dominates a significant market share of the search engine market in America where it accounts for 67% of the internet searches in the country (Zeckman, 2014). It is necessary to focus on its dominance in the United States. Technology organizations have to ensure that they stay agile in order to succeed. Agility involves the ability to respond to change. The feature involves the ability to predict change, to create appropriate responses and to implement those responses in an effective manner. Google has succeeded in taking advantage of opportunities in emerging technologies. The process has involved a deliberate attempt to streamline search engines, revolutionize the advertising industry and centralize data and tools. In addition, it has embarked on a mission to digitize books and provide open source mobile phone operating system. Android has emerged as a great operating system for low-cost mobile phones. Furthermore, the organization has focused on changing the way human beings interact with technology every day. In the process, it has succeeded in creating a diverse portfolio of products that range from desktop, mobile, web and hardware products. Moreover, it has managed to be a consistent top performer in surveys on the most attractive organizations for graduates. The organization has also benefited from the ability to maintain high rates of employee retention. As a result, it has managed to utilize some of the most talented minds in the technology industry. Google is involved in a very competitive market. The plethora of products and services that it offers ensure that the organization is faced with competition from many sectors. However, the organization has managed to create new sources of competitive advantage. The new sources include integration and a keen understanding of the external environment (Foss 2012, p. 1). Google has a robust infrastructure that cannot be replicated easily by other organizations. The organization has established a strong reputation for having a vast technology infrastructure. Competing search engines such as Bingo and Yahoo would have to find a way for ensuring that the organization has the speed and comprehensiveness that it possesses. The services offered by the organization cannot be possible without its robust infrastructure. The resources make it difficult for its rivals to provide a similar service. For instance, an organization with billions of dollars would still have to build an infrastructure from the ground. Consequently, its infrastructure is a source of competitive advantage. A resource-based view (RBV) of the organization demonstrates that Google has succeeded in attaining resources that are not only valuable, rare and imperfectly imitable but also non-substitutable. Firstly, the organization has attained a significant market share in search engine. The unit drives its advertisements that account for a disproportionate share of advertisement revenues. Secondly, the organization has managed to create a lively and creative organizational culture that has made it an attractive employer. The ability to recruit some of the brightest minds in the world plays a significant role in the culture of the organization (Dholakiya, 2014). Thirdly, the technology giant has a large portfolio of patented technology. The acquisition of Motorola in 2013 led a massive increase in the number of patents owned by the organization. The acquisition provided Google with many patents. In addition, the organization has rare and imitable resources. Furthermore, the organization has benefited from its relentless focus on substitutability. The clean and minimalist user interface has attracted many users to the site (Baroudi, 2014). As a result, it has managed to attain a lot of market share. Most users do not switch search engines. As a result, the organization has the advantage as a market leader. The public image of the organization is one of the most significant sources of advantage for the organization. The organization has a philosophy that is focused on adding value to society as opposed to an organization that is focused on pursuing short time objectives. In addition, its position as a technology giant enables it to generate many positive media mention\. The competitive advantages of the organization ensure that users come back. In addition, it serves its consumers in a fast manner. Consequently, users are more likely to keep using the site. For example, a user can key a key phrase and it will show up with little success. Google has developed multiple prices for its consumers. For example, the organization employs tools and services that enable the user to access multiple services such as Google toolbar and Google News. In addition, it has expanded to the mobile phone category where it delivers services and features on mobile phones. Google has achieved a lot of financial success by focusing on extracting value from the value chain. The organization benefits from its ability to provide accurate data free. In addition, its data analytical capabilities serve as a significant source of competitive advantage (Mckinsey and Company 2012, p. 34). The organization accounts for a significant majority of the internet connection in the world. In addition, it has a dominant position in the online advertising industry. Google has the ability of managing people in an effective manner. The ability is a source of differentiation and cost advantages. Most organizations rely on trust and relationships to manage people. In contrast, Google uses data about its employees in order to effectively manage them. This ability gives it the ability of making appropriate data based decisions about the best people to hire and using their skills highly. In addition, it enables it to establish the most effective ways of managing it. Consequently, Google can hire innovative employees that are very productive. The ability to hire skilled employees is a source of competitive advantage. The organization has the necessary IT skills that enable it to manage the data about its employees. Competition Issues Google faces a new challenge. The organization has to focus on vertical integration with handsets and OS. The integration has pushed it into a market that is dominated by Apple, Microsoft and Amazon. As a result, it is forced to compete with big organizations in multiple product categories (Singer, 2012). For example, its Android operating system has emerged as a direct competitor to the Apple iOS. In addition, the organization faces a lot of competition from small startups in the country. For example, some startups are developing search capabilities for specific users. The move is informed by the growth of online communities. Furthermore, its investment in many categories means that it risks disrupted by small organizations that are targeted on a small customer base. The organization risks missing the payments industry. Currently, the only technology industries that are offering online payment services include Google and Apple. Consequently, there is a risk that the organization will be left behind in the push for payment services. How to handle the challenges For Google to outcompete its competition, it needs to maintain its focus on constant innovation. In addition, it needs to be open to the possibility of changing its business model (Carlson, 2014). An evaluation of its strategy demonstrates that it is on the right course. For example, its Chrome Browser has overtaken Firefox by grabbing 20 % market share (Leather, 2014). Furthermore, the organization needs to focus on increasing its competitiveness by building up its market knowledge, technology and processes (Greenfield, 2014). The move will enable it to keep up with competition from Apple in the United States. In addition, it will enable it to retain its market share in the American market. The evaluation of the strategy adopted by the organization demonstrates that their investment in other products is driven by a desire to increase demand for its search services. For instance, its delivery services was based on the need to increase internet searches on its site (Griswold, 2014). In order to protect its traditional search engine business, Google will have to find effective ways of data management. The move will ensure that it can compete effectively with Yahoo as it seeks to reenergize its business operations. The biggest competitive advantage for Yahoo is its data capabilities (Schonfeld & Scott 2014). Google has to focus on developing products that are optimized for mobile devices. The rise in mobile computing devices has led to an increase in demand for products that can work well on mobile phones, tablets and iPad. For example, 83% of its revenue came from mobile devices (Sterling, 2014). Conclusion The organization has a major competitive advantage over its competitors. As a result, it should persist with its focus on striking the right balance between innovating, expanding, and focusing on its traditional web and internet services (High, 2013). The latter is a source of downstream competitive advantage. In addition, investing in appropriate areas would enable it to build its capabilities upstream. The move involves current acquisitions, projects and alliances. Moreover, it would ensure that its value keeps enhancing its customer experience. A consistent focus on growth would create an advantage that would be difficult for its competitors to replicate (Varghese 2011, p. 9). List of References Baroudi, George. (2014). Googles Competition Is Amazon, Not Apple. [Online] Available at http://www.informationweek.com/mobile/mobile-business/googles-competition-is-amazon-not- apple/d/d-id/1113561 [28th Nov 2014]. Carlson, Nicholas. (2014). Larry Page Lays Out His Vision For The Future: Were only at 1% of what’s Possible. [Online] Available at http://www.businessinsider.com/larry-page-lays-out-his- vision-for-the-future-of-google-and-technology-2013-5. [28th Nov 2014]. Dholakiya, P 2014, Companies Gain Competitive Advantage by Improving Employee Health. [Online] Available at http://www.entrepreneur.com/article/239489 [28th Nov 2014]. Foss, N. 2012, Innovating organization and management: new sources of competitive advantage. Cambridge, Cambridge University Press. Greenfield, R 2014, This Is Googles Vision of the Future. This Is Googles Vision of the Future. [Online] Last accessed 28th Nov 2014. Griswold, A 2014, Google Thinks Amazon Is Its Biggest Competitor. Available: Google Thinks Amazon Is Its Biggest Competitor. Last accessed 28th Nov 2014. High, P 2014, Google ITs Mission to Empower Gogglers with World Leading Technology. [Online] Available at http://www.forbes.com/sites/peterhigh/2013/07/22/google-its-mission-to- empower-googlers-with-world-leading-technology [28th Nov 2014]. Joe, T 2012, Google is Tier 1. [Online] Available at http://www.fool.com/investing/general/2012/03/07/google-is-tier-1.aspx [28th Nov 2014]. Leather, A 2014, Google Chrome Browser Market Share Tops 20%: Leaves Firefox In Its Dust. [Online] Available at http://www.forbes.com/sites/antonyleather/2014/08/04/google-chrome- browser-market-share-tops-20-leaves-firefox-in-its-dust/ [28th Nov 2014]. 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[Online] Available at http://searchengineland.com/googles-search-market-share-67-percent-pc-83- percent-mobile-203937 [28th Nov 2014] Varghese, J 2011, Competitor analysis: working paper [Online] Available at http://www.contentreserve.com/TitleInfo.asp?ID={62624DEE-7FFE-4CA3-8E74 6588F7205902}&Format=410 [28th Nov 2014] Zeckman, A 2014, Google Search Engine Market Share Nears 68%. [Online] Available at http://searchenginewatch.com/sew/study/2345837/google-search-engine-market- share-nears-68 [28th Nov 2014]. Read More