STRATEGIC PLAN CASE 'GOOGLE'

INTRODUCTION:

Larry Page and Sergey Brin met in 1995, when they were 24 and 23 years old respectively,
at an event organized by Stanford University. Both had a common goal:
to obtain relevant information from a large amount of data. In January of
In 1996, they began their collaboration on a search engine called BackRub. Larry started working on the
a way to achieve an environment for the servers that would work with low-end PCs and that
It will not require powerful machines to operate.

A year later, the technology used by BackRub to analyze links was beginning to be
known throughout the campus, gaining a great reputation. It was the foundation upon which it
I would build Google.

The name comes from a play on words with the term 'googol,' coined by Milton.
Sirotta, nephew of the American mathematician Edward Kasner, to refer to the number
represented by a 1 followed by 100 zeros. The use of the term reflects the mission of the
company to organize the immense amount of information available on the web and in the
world.

It began operations in 1998 during the tech boom, Google experienced a

continuous progress developing tools that provided great utility to the community
internet user. To define the strategy, given the large number of services offered,
We will only comment on those services that would provide support in the daily life of anyone else.
company or business, especially those that base their strategy on product differentiation
(using mass promotion channels) or even those aiming to reduce costs
(using cheap or free services); we will briefly describe only these features
oriented towards companies given their strategic importance and as the main source of
income.
The success of Google was due to its 'anti-orthodox' image, developing, improving,
updating their products and offering most of their services for free.
All this dynamism is reflected in the Explore and Innovate section: a section dedicated to
development and testing of new products available to any user (in its version
BETA or unstable)

This brought with it that in a company of such dimensions, we also encounter

various inconveniences or problems associated with their services:

They mainly dealt with errors or failures in the system which in turn cause the division.
within the community.

In addition to the fear that Google may use the enormous amount of information in a way
undesired and that could provoke an invasion of privacy for personal gain.

This is due to the massification of data that this type of company entails, we are faced with the
questionable reliability of filters designed to restrict flows of illegal or immoral information;
Conflicts constantly arise over the dissemination of certain content.

It could be accepted that Google's main 'asset' is the information characterized by

its intangibility and difficulty of valuation; therefore, doubts arise regarding factors such as the
property, responsibility, regulation, etc. Who and how should supervise or 'audit' these?
companies?, who is responsible in case it ever goes bankrupt and
Would all the generated value disappear? Is there any figure that approximates the valuation?
intrinsic to such a large amount of accumulated information?

There are many criticisms related to Google's main source of income, the
advertising. For the internet user, it can be annoying and uncomfortable to encounter blocks of
advertisements that distract your attention hindering the search for an informative result
concrete. While for companies the main drawback lies in the
difficulty in determining an optimal promotion program.
HISTORICAL REVIEW

Google Inc. is the company that owns the brand Google, whose main product is the engine
of content search on the Internet of the same name.

This engine is the result of the doctoral thesis of Larry Page and Sergey Brin (two students of
PhD in Computer Science from Stanford University) to improve the
internet searches. The coordination and advice were due to the Mexican Héctor
García Molina, then director of the Computational Systems Laboratory of the
same Stanford University. The domain "Google" was registered on September 15,
1997. Building on the completed project, Page and Brin founded, on September 4, 1998,
Google Inc. company, which launches its search engine on the Internet on September 27.
next (considered the anniversary date). They had a server with 80 CPUs, and two
HP routers. This search engine surpassed the other more popular one of the time, AltaVista, which
It had been created in 1995.

Although its main product is the search engine, the company also offers other services, such as:
a price comparison tool called Google Product Search (formerly known as 'Froogle')
a search engine for material stored on local disks (Google Desktop Search)
an email service called Gmail, its 3D world map Google Earth, a
instant messaging service based on XMPP called Google Talk, the web browser
Google Chrome, and its latest creation, the social networking service Google+.

Its main infrastructure is composed of several data centers that operate with the
RedHat distribution of the GNU/Linux operating system, whose choice was made due to
due to its flexibility, most of its workers also use this same one
distribution in their workstations for comfort.

Currently, Google is working on new projects such as the 100-dollar PC, a

new operating system, Google Docs & Spreadsheets, collaboration and promotion of
free software applications like Firefox, installation of multiple free wireless networks,
development of an open protocol voice communication system among others. In addition, it
It is speculated that he would be working on the development of a 'GoogleOffice' and a global network of
fiber optic.
Vint Cerf, considered one of the fathers of the Internet, was hired by Google in 2005. The
the company is listed on NASDAQ under the symbol GOOG.

In October 2006, Google acquired the famous video site for 1.65 billion dollars.
YouTube.

In April 2007, Google acquired DoubleClick, a company specialized in advertising.

Internet, for 3.1 billion dollars. This same month, Google became the most valuable brand.
most valuable in the world, reaching a total of 66 billion dollars, surpassing
emblematic companies like Microsoft, General Electric, and Coca-Cola.

In July 2007, Google purchased Panoramio, a website dedicated to showcasing photographs.

that the users themselves create and geotag, some of which are uploaded to the site for
that can be viewed through the Google Earth software, whose objective is to allow for the
users of the mentioned software learn more about a specific area of the map,
observing the photographs that other users have taken there.

In September 2010, Google implemented 'Google Instant Search,' a feature that allows
make searches as the user types their search term. In principle
it is only accessible to users of the English version, and to users registered in the version
Spanish.

In August 2011, Google acquires Motorola Mobility for 8.8 billion euros (12,500
million dollars). With this acquisition, Google will control the majority of the market of
Android phones and will have its own mobile phone factories just like Apple.
STRATEGIC PLAN

For Google's strategic plan, we will follow the following stages:

1.- Analysis of the situation

2.- Diagnosis of the situation

3.- The corporate objectives

4.- Corporate Strategies and Decisions

1.- Analysis of the situation:

1.1 Analysis of the external situation:

Degree of competitiveness of the sector

The internet search engine sector is considered a very competitive sector, as

Currently, the Internet stands out as a relevant source of information for users.
of the business and social world. With this, the possibility that search engines have to reach
higher rents decrease, making the sector less attractive.

Nowadays, you can do practically everything on the Internet: buy-sell, operations.

banking, intercontinental videoconferences, etc. It could be said that it 'creates' one more medium
comfortable, faster, low-cost and, in principle, very effective for certain actions
business-related.

The Internet has become one of the main sources of information for users.
decision making: when the user needs information about a company or a
product/service the first thing it does is consult a search engine (hence some, like
Google, MSN or Yahoo are the most visited portals on the Internet.

The internet information services sector is considered as a sector

"fragmented", as there are many search engines on the Internet that offer various services
Aside from the classic search engine, few have a significant market share.
In the case of Google, it has a large market share, which it is gradually losing.
in favor of MSN and Yahoo; although innovative ideas can arise at any moment that
greatly affect the competitive situation of the sector. The barriers to entry are
scarce or nonexistent on the Internet, the only impediment is having some distinctive quality
that generates benefits or even ensures success.
The search engine sector is considered a growing sector. Despite having already passed more
of a decade since the birth of the Internet and the subsequent technological boom, this market so
dynamic shows every day that there is always something left to invent in society of the
information.

Google stands out for its high level of product differentiation (use of channels of
mass promotions); With this, competition is somewhat mitigated and Google achieves the
user loyalty with the different products offered, since the users who
they use this search engine and are happy with the results obtained, they will not be incited
to turn to others. User satisfaction is reflected in the constant and successive use.
of the search engine.

Negotiating power (Google users: internet users and companies).

The bargaining power of users who use the Internet is high, as users in their
searches, they are the ones who will impose their conditions, that is to say, they are the ones who will establish
what they want to look for, what interests them.

The degree of differentiation of the offered products or services is high; the level of
User information regarding the searching company is high, as it can be obtained.
information you want and at the moment you want.

The bargaining or influence power of the searching companies is also high because
they know what content might interest users.

In any case, given the large number of portals that offer the same services as
Google and for free or cheaply, users can switch providers relatively easily.
ease and with hardly any costs. For this reason, it is worth noting that on the Internet, the bargaining power
prevails over Internet users, and that company that does not fulfill its role
correctly, it runs the risk of losing customers in very short periods of time.
Possible threats from new business models.

Over time, technology and knowledge progress, making way for

new commercial ways of searching for information, and perhaps if it is currently in fashion the
search engines, in a few years there will be much more amazing innovations for the
users. This sector of information technology is very volatile and dynamic, and in
At any moment, any new entity can emerge to dethrone the giants.
competitors.

Market analysis: (types of markets and formats with which Google competes; analysis
dynamic, not static, with a future perspective; establish the opportunities and threats of
environment/market.

Within the markets and formats that Google competes in, it stands out for example, the
launch of a free telephone directory, Goog-411, a strong alternative to 411
North American generic, similar to the 118 services in Spain. It is a service
completely automated: dialing 1-800-GOOG-411 connects you with a switchboard
equipped with experimental voice recognition technology to which data can be provided
many types
a postal code, etc., and receive the result through the voice of the system itself, be
directly connected, or receive an SMS to comfortably keep the number
registered.

The information used by the service comes from Google Maps.

The product had been tested by Google in various formats for some time, and
competes with other similar services in the local voice search market,
among others with TellMe, acquired by Microsoft.

TellMe is, for some analysts, the most comprehensive of the technologies dedicated to this type of
services, although not many mobile phone terminals can run their platform.

In Spain, the situation is going to be curious: with services like Goog-411, Google seems to go
clearly targeting the telephone directory market, a very active market
in which Google Maps entered Spain precisely through an agreement with TPI, today
property of the British Yell.

Market situation / area of influence: existing companies, types of products, market shares
market and chosen types of clients.

Principales competidores: descripción (Microsoft MSN, Apple, Yahoo).

1.2 Analysis of the internal situation (detect weaknesses and strengths; evaluate).

Set goals and goals to follow.

Google wants to strengthen the privacy protection of Internet users. It plans that its
personal data should be completely anonymous after 18 or 24 months from their
collection in order to prevent these from being used to identify them.

The development of its own mobile phone is one of Google's next objectives.

Offer relevant and high-quality ads that help improve the service provided to
user.

Create a test field for the use of WiFi technology.

2.- Regarding the SWOT analysis of Google, we have:

As a threat:

One must be careful with the constant growth of information.

That, at times, people are not connected to the Internet. This is a key point for the
the fastest growing company on the Web. Since it allows the implementation of new technologies

Opportunities: Google continues to expand the funds of its digital library, this may lead to
in the advantage of having information not available digitally but available on paper.

definition of competitive strategy

Portfolio strategy (markets / products).

Segmentation strategy.

Positioning strategy.

Functional strategies.

Human and material resources:

To determine the staffing level that Google has, a representative example is the
from the acquisition of YouTube. In October 2006, Google took control of YouTube,
which incorporates it into its systems, which it can do easily because both sites are
complementary. Google has excess human and material resources to develop a
application similar in functionality to YouTube, and even improve it.

The vast majority of workers are computer engineers, web designers, and others.
technicians related to computing.

Google develops very peculiar recruitment methods; sometimes it uses formulas

mathematics and logic to measure the intellect of potential candidates and determine the
most suitable position to occupy.
Communication strategy: advertising, marketing, promotion.

Sales strategy: customer service and attention staff.

Diagnosis of the situation: conclusion of the previous analysis; SWOT analysis

3.- Corporate Objectives System:

The corporate objectives system aims for: more profitability, more growth,
more sales, more income, more market share.

To organize the world's information and make it universally accessible and useful.

Mission: reason for the company's existence. It is conceived as an opportunity to do business.

that a company identifies within a context of needs.

Google's mission is to "organize the world's information and make it universally accessible
accessible and useful. To this end, Google offers a range of products and utilities to help
find, organize, create, and share anything of interest.

The mission at Google is really to build the best search engine. This means that it must
understand anything about the world, understand exactly what you write when you do
a search, and that it returns exactly what you want.

Vision: long-term goals to be achieved, strategic objectives. It can be defined with a future.
relatively remote where the company operates under the best possible conditions of
in accordance with the dreams and hopes of the owner or executive director.

The overview of Google, a search engine positioning company, is to offer the

better internet search experience by making information, on a global scale, be
universally accessible and useful.

Google, developer of the world's largest search engine, offers the fastest way
and easy to find information on the Internet.

Values: solidarity, honesty, integrity, tradition, internal transparency, customer orientation

client.

Ambitious growth objectives as a large company: high growth rates, to

achieve a greater dimension and obtain higher profitability rates in the long term
(sacrificing short-term profitability).
4.- Corporate Strategies and Decisions:

LEVEL 1: CORPORATE STRATEGIES:

business definition: types of needs to satisfy, segments to serve, technologies

used

Portfolio strategy (business): business and product-market alternatives (large

company many alternatives);

Penetration strategies

Diversification strategies

New markets

New products

Competitive strategies: cost leadership, product differentiation, segmentation.

Growth strategies:

Continuous innovation of services and the search for new unmet needs;
Google shows us every day its entrepreneurial potential by developing and updating,
correcting, etc.

Internationalization: strategies for new foreign markets, e.g., to China or Arab countries; the
the difficulty of this strategy lies in the adaptation of its information services through
filters and restrictions to avoid cultural, religious, ethical, moral or legal conflicts.

Diversification: continuous development of related and unrelated new services.

yes; it is not a purely or radically diversified approach since we start from knowledge and experience
acquired about similar services in terms of programming and design (therefore, less
risk).

Horizontal diversification: Google diversifies into related services that it uses.

as advertising support to generate income (e.g.: YouTube purchase as a service
audiovisual, development of Google Earth as a geographic information service, development of
specialized search engines like Googlecode, etc.

Vertical integration: Is Google merging with its suppliers/customers? We believe not.

though it wouldn't be surprising if one day Google acquired some important portal that operates
as advertising support through its Adsense services or that it will integrate with some
another client portal that is promoted through the Adwords service (thus eliminating the cost
what the promotion would mean for that portal.

Internal / External development:

LEVEL 2: PRODUCT PORTFOLIO STRATEGY:

Definition of the product-market binomial for each business unit:

Strategic markets

Strategic products

LEVEL 3: SEGMENTATION AND POSITIONING STRATEGIES:

Definition of the segmentation strategy: the main segment of Google is the sector of the
information through the Internet. Competitiveness is very strong and growing although Google
It is constantly developing new information services. The most important thing is the
the gratuity of its offers and the financing through advertising blocks, in this way it
generate massive traffic that constantly generates income. All services could be
separate into smaller segments depending on the information needs for the
Googleearth (world geographical information), search engines of different types
data (Googlecode, Googlebooks), etc.

Other important segments are the advertising and promotion services through the
advertising 'Ads' and the positioning of pages in search engines.

Falls to develop other functionalities aimed at data management and processing (sheets
of calculation), as well as the organization of documents and others.
LEVEL 4: FUNCTIONAL STRATEGIES

Marketing (marketing mix)

Financial

Production

Human resources

R&D

Organization

Operational decisions: The definition of operational decisions is undoubtedly the most significant phase.
concretion in decision-making. It's as if we were providing the entire theoretical framework with
strategic that we have developed so far for limbs to walk.

To be effective, a strategy must translate into concrete actions. Furthermore, it is

It is important to assign a person responsible for supervising and executing the action plans set out.
the estimated deadlines (action calendar), as well as assign human resources,
required materials and finances, evaluate the expected costs and, in a special way,
prioritize the attention and dedication that should be given to such plans based on their
urgency and importance.

Regarding the nature of the actions, they will refer to the functional strategies more
timely in each case, being its condition of "final stage" of the decision-making process
decisions a powerful reason to respect and reinforce the fundamental criterion followed until
now, the coherence with what was determined in the previous phases.

Conclusions:

Google is an organization that possesses extraordinary qualities and a unique versatility to

offer a series of support functions to businesses. However, in the area
the business does not have a structure based on planning and future forecasting,
sustainability, economic-strategic health, legislation, etc. Which is just being
structured.

On the other hand, we have the explosion in recent years of the development of new technologies, which
causes a gradual increase in attractiveness for users, which prevents them from
question aspects such as the safety of customers in online services. Like everything
social reality absent of problems, Governments divert attention to other aspects and
they forget to create regulations, provisions or funds to prevent possible situations
problems for the organization.