With the increase in competition and globalisation, it has become necessary for companies to think about strategies and function which would gain them competitive edge and organisational success. It is important to know how organisations will adapt to new strategies and changes and how much success would they achieve.
That is what this paper exactly talks about. It aims at analysing various organisational behaviour functions at Google Inc. Are they successful in their approach? How effective is the functioning of Google Corporation in getting the best from its employees?
AIM OF THE PAPER
Organisation Behaviour [OB] involves the study of individuals and groups in an organisation. The study includes various functions like Motivation, Leadership, Culture, Change management etc. It is important to study these together and to check how successful the organisation is. OB involves various models and theories which can practically be applied to the people to modify their skills and thinking.
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Google is the Corporation to be analysed for Organizational Behavioural Issues. There is hardly any person in the world who does not know Google. Yes it is the company which needs no introduction. Being the number one search engine, it is the part of our everyday lives. It is one of the successful companies in the world day. Regarded as Best Place to Work for consecutively for two years in 2007 and 2008, it is the company known for its culture. This paper aims at thorough study of various aspects of organisational behaviour like various motivating factors that are employed by Google for betterment of its employees, the leadership qualities of its founders, the unique culture and various management practices involved in making it one of the finest companies to work for.
The initial part of the paper gives the overview of Google Corporation. Then performance is analysed by a balanced score card. In the next section it talks about the culture and management practices at Google. It is that factor which makes Google what it is today. Then, describes various Motivational factors for employees and theories which relate to it. Further analysis of founder's Leadership is done. While analysing each of these sections, theories and models are related to them. The final sections talk about the recommendations and conclusions about Various OB factors.
Google - The most important part of our lives. The day begins and ends with 'Google'.
It is the popular search engine among the internet users today. It was started in 1998, by Larry Page and Sergey Brin, the two young entrepreneurs. Googleplex which is corporate headquarters is located at Mountain View, California. Google believes that innovation depends on people being comfortable at work. Hence, the culture is very informal and casual. Having offices across the globe, it has attracted many global audiences to serve. Many companies including large and small firms envy the culture at Google.
The mission statement of Google states that their goal is 'to organize the world's information and make it universally accessible and useful.'(Google, 2010) Google mainly focuses on its users, to exactly return what is being asked for in a search engine. Every effort is being made to improve the efficiency and speed of the search engine. Various other products such as Gmail, Google News, and Adwords etc. are also provided for users. What comes to mind is that how are all these managed? So how important is Organizational Behaviour for a corporation like Google? What exactly is Organizational Behaviour?
'A field of study that investigates the impact that individuals, groups, and structure have on behaviour within organizations, for the purpose of applying such knowledge toward improving an organization's effectiveness' (Scribd, 2003)
Organizational Behaviour is very important for any company to understand the behaviours of its people. It includes various functions which in total would count for the effectiveness of an organization. Various functions may include the Management styles, Communications, Motivating the employees to perform exceptionally well, Leadership styles etc.
The performance of Google is been outstanding from past few years. It is the company known for its Innovation, Culture and especially for its brand equity.
The Balance score card of Google (scorecard, 2007) gives an idea of its performance:
Always on Time
Marked to Standard
Balanced Score Card Category
Strategies for growth and reduction of risk in shareholders perspective
Increased Net Revenue
To increase Ad Revenues
Improvements in search.
Development of new technologies and innovate products
Improve Adwords and AdSense which is main revenue for Google.
Enhancing instant search which will increase profits.
Can be done by acquisitions which are economical and beneficial
Strategies for creating value to the customers
Increased number of customers
Retain the customers
Increase the number of searches as well as the number of clicks on Adwords
Improvements on search engine
Variety of products for all purposes that customer wants
Addition of various new features to search
Easy to understand for users about new products.to keep it simple
Internal Business Process
What processes need to be improved?
Adwords and AdSense
Display Relevant data
Increase speed to return accurate data
Simple yet trendy user interface
To advertise more in western countries
To improve security of personal data
Quick and easy to use
Improve security features
Higher volume of data attachments
Improve the text displayed for Adwords
Learning, Growth and Innovation
Reduce response time for returning results in search
Figure: Balanced score card, 2007*
Balanced scorecard key measures are:
How are the financials for Google? There has been increase in net revenue due to advertising. It can further be improved by having attractive clickstream data to make it work better. What do shareholders perceive? There is increase in profits by having instant searches. Strategies for growth include developing of new innovative products which can be achieved by having acquisitions which already have many innovative products.
There has been increase in the number of users. Google search is being enhanced to improve the quality and reduce the time taken for search. This overall has improved performance. This can retain huge number of users.
Internal Business Processes:
Search is further being improved by instant search, reducing time taken for search. Social networking sites like YouTube etc. can be advertised more in western countries. There are security measures taken to protect user data.
Learning, Growth and Innovation:
Adwords and AdSense are being continuously improved. They are not displayed in the search content which has made users happier. 97% of the revenue comes from advertisements displayed in various Google sites.
Overall, performance of Google has been outstanding. It credits all its success to its employees.
Culture at Google
Culture forms an important part of the organisation. Culture can be defined as 'a pattern of basic assumptions - invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration - that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems' (culture, 1998)
To have a successful culture it is important to decide for the organizations as to what relationships would it keep with users and employees and of course the environment they would provide. Google states that 'It is not a conventional company and we do not intend to become one'. These words have an impact about its strong culture.
Google has many core values which depicts its culture. Here are the few important ones as:
'Focus on the user and all else will follow.' (Google overview, 2010)
Mainly focuses on user. The Google search page design and layout are kept simple for users to understand. Advertisements are kept separate and are not included in the search results. For Google it's the employees who are at most people. The policy at Google is that users should not be shown unnecessary and flashy advertisements which will distract them. The search page is kept simple from a customer's point of view. If they get users right then everything will fall into place.
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'You can make money without doing evil.' (Google overview, 2010)
Google's main revenue comes from an application called Adwords. Advertisers use this to promote their products. There are also principles in displaying these advertisements
No ads will be displayed along with the search results. They will only be displayed if they are relevant to what is being searched.
Displaying of ads will not be in pop-up or not being shown as flashy to the users. At Google it is believed that ads can be more effective without following the traditional ways.
Advertising will always be shown under a sub heading called "Sponsored Links". No compromise will be done with the integrity of search results.
This value mainly depicts their integrity and ethical values of their culture. They do not change their ways to make more money. No ads will be displayed in the search content.
'You can be serious without a suit.' (Google overview, 2010)
The environment at offices is so casual. People from diverse background are hired who are more creative at work and life. The workplace is so informal and casual that many a time ideas emerge at cafeterias, gym etc. Inside Google, it is a relaxed atmosphere where everybody enjoys doing their work. Founders are seen in casual and t-shirts inside Googleplex. There is no formal culture.
'Great just isn't good enough.' (Google overview, 2010)
Google sees great at something at a starting point and not at ending point. Goals are set where it is impossible to meet them but through innovation the goals are reached far more than expected. Google is always looking for new ideas where they can make a difference. These core values give us an idea of what Google is.
Google is always a risk taker. Most of the ideas often generated by employees are often worked on. But there are also failures and most of them stop by mid-way. But Google always wants to experiment something new no matter what the end result may be. Founders are seen roaming in Googleplex often on jeans and casuals. It is so flexible whether in terms of dress code or time off from work etc.
Yes, it is this unique culture which makes Google as "Google". It is this strategy which drives Google to its success. It is important for employee to let them be instead of binding them to the formal culture. Google has an incredible relationship with its employees. All the opportunities are given to its employees. This leads to entirely a different work culture that is so innovative and encouraging employees to think out of box. Also, numerous awards will be given for the best ideas. What makes a difference is that the support of the company to its employees to achieve their passion. Even though all the 20% time projects may not be productive or successful, Google feels that it is the experience of failure which would lead to a path of success later on.
These benefits will have a strong impact on how employee feels about their employer and work environment. Clearly so many benefits and perks will definitely motivate employees to perform better as well as to retain them. Employees take pride in their jobs at Google. It helps them to stop worrying about other factors and concentrate more on their jobs. Probably this is one of the effective strategies to make employees satisfied and remain loyal to the company.
Google use Adaptability culture because they need to act quickly to satisfy customer needs. (GoogleDocs, 2009)Google is a company whose value promotes Individual initiative, experimentation and risk-taking. What makes them unique is their innovative culture. It can be seen throughout the organisation. Short questions will be posted on doors which challenge employee brains to think. This is just another way of making employees innovative. Even failure does not affect them much. Google culture works. The atmosphere inside is like fun filled environment just like some university. Employees can bring in their pets too. Everyone is encouraged to propose ideas. This is definitely in a true sense what makes Google.
Google's culture is not same old traditional culture which many companies still follow. It is something which makes employees proud. Such culture definitely increases the motivation in employees to work better. The campus, fun, rooms packed with snacks, 20% of time to work on projects of their choice, and so many is what is really needed to motivate the employees.
Google provides variety of perks and benefits to its employees. Benefits depend upon the location of the offices. At U.S headquarters some of the benefits program include: world class children's centre, massage services, fitness centre, and a wellness service with onsite physicians etc. Variety of benefits include: health insurance, dental insurance, vision insurance, Employee assistance program, business travel accident insurance etc. Employees can contribute up to 60% and can receive Google match with no vesting schedule. Employees can save money for their post-secondary education.12 paid holidays are given to employees, Maternity and paternity benefits with 100% take-home pay, Take out benefits for new moms and dads are able to expense up to $500 for take-out meals. Tuition Reimbursement can be reimbursed up to $12000 provided at least B grade has to be achieved. Employees get referral bonus. Adoption assistance is provided by offering financial assistance up to $5000 towards legal assistance or legal agencies in adoption of a child. Free lunch and dinner are provided for all employees. Chefs are hired to prepare tasty foods. Rooms are filled with snacks. Google has a unique culture of letting the pets inside the campus. The list does not end here. Huge number of benefits and perks are provided to ensure that employees are satisfied and perform better and enable Google to achieve the success. (Google benefits, 2010) Google is highly competitive when compared to other companies in terms of the pay.
Along with these facilities, Google provides its employees with variety of training courses. There are leadership development programs, foreign language classes etc. Google spends lot of its budget in training and developing its employees.
According to Brown's Total Reward Model, the pay and benefits are at most important for employees and are very much necessary. Employees who are highly motivated can perform better. The Tangible things count more at the time of hiring and intangible things count while working. It is the mix of both tangible and intangible that an employee is motivated to perform better. Various benefits include: flu shots, onsite doctor access, car washes, oil changes, scooter to roam in the campus, tasty food, free massages, TGIF parties, annual trips etc. Well, the list does not end here. The culture is so casual along with a competitive pay scales and bonuses. In all, a total reward to the employees of Google. But what really count are the intangible things. The work culture, stress-free environment, fun and the satisfaction feeling which each employee has is what the main reward is.
It is very important for any organization to have employees who are satisfied with their jobs which in turn will motivate them to perform better. Google satisfies job Characteristic Model. Employees here are motivated by their work itself. It lets them grow and take on more responsibilities. Sufficient freedom is given to employees in various aspects like work itself, dress code, workplace etc. This has positive influence and a healthy atmosphere at the workplace which will motivate employees to perform better and better. Working on different kinds of projects that interests the employees can be more satisfying than working on same projects every day. What really important is that employee sees their job is being enriched than enlarged.
Leadership at Google
Larry Page and Sergey Brin the founders of Google are popularly known as 'Google Guys'. (Time, 2010) How did Google start then? It all started when Larry Page and Sergey Brin met at Stanford University during their doctoral program. Search engine was developed as a part of their project. They were not keen to start a new company. Their advisor suggested them to give a try and rest is all history. They are smart entrepreneurs attaining success at a very young age.
Eric Schmidt the CEO of Google, along with Larry Page and Sergey Brin exhibit Entrepreneurial Leadership. They take initiative and energize people around them. They take risks and continuously venture into new space, strategies etc.
The creative environment is provided throughout Google Corporation to ensure that people come up with new ideas. And brilliant ideas would be further developed. Examples of such ideas which became huge success were Gmail, Google news, Orkut, Google Earth and so on. What most important is that even if a failure is attained, they are ready to take responsibilities and most importantly learn from the mistakes and develop strategies to avoid it for the next time. The main goal of Google entrepreneurs is that they instil confidence in their people to think and behave like entrepreneurs in the interests of the company goals and also beneficial for its growth.
It is due to their leadership that Google is popular today. They do not have traditional ways but rather something unique and creative. Eric Schmidt always says that Google does not have any five year plans. It is because they are constantly innovating and coming up new ideas. There is no formal system to do the same task. Innovative ideas are got and implementations of those ideas happen. This is what Google is all about. Employees are provided with a white board throughout the campus. They can put up their ideas there. On the doors puzzles will be put up. This makes employees think. Such minute things are done in large number to get the creativity out of employees. They make environment more creative and largely influence the thinking of people around them. It leads to intrinsic motivation for employees in the sense that 'what an individual can do and what an individual will do' (Zhang, Bartol.M, 2010).
Organisational Structure and Management Practices
Organization Structure is a structure where business is arranged in some way to perform its activities. 'The Best Thing about Google Is Its Flat Management Structure' says Vinton Cerf Vice President & Chief Internet Evangelist, Google (Meet the boss, 2010). No middle managers are present. It looks impossible to have flat organizations in such a large corporation. But Google has done it. This structure mainly enhances a better communication between employees and management. It has positive effects like better team spirit, easy decision making and mainly cost effective.
Clearly the Google depicts McGregor's Theory Y for the following reasons:
The philosophy states that 'You can be serious without suit'. Most of the innovative ideas happen at cafeteria, or team meetings or even the Gym. Employees are given flexibility in terms of their creativity. Google believes that the overall success is because of its employee's contribution and accomplishments. (Mullins.J, 2008)
Google believes that every employee is a hands-on contributor.
At Google, employees are given 20% of their time to work on the projects they like or interested in. Remaining 80% on their regular projects. This mainly drives employees to be motivated and overall improve the performance.
Various benefits like free lunch, shuttle services, medical programs, and stock options, maternity and paternity leaves are provided. Most of the things that matter to the employee are taken care by Google.
Additionally a competitive salary, various perks, employee referral bonus schemes are provided.
Comparison with Microsoft
Considering Microsoft as a close competitor to Google, a comparison can be made based on their organisational behaviour factors. Both companies provide numerous benefits and perk which has led its employees to work better. Microsoft is more technological company when compared to Google. More emphasis is on technology while for Google it is not the same. Employees at Google are given 20% of their time to work on projects that interests them. This has increased their motivation to perform better. Microsoft has entirely different strategies. They provide employees with two career paths. One being employee can choose to remain at technology side while other he/she may choose management path. And, interestingly both these strategies have worked for both of these companies respectively. But Microsoft has a hierarchical structure while Google has flat structure. Employees experience more freedom in a flat structure rather than in hierarchical structure. They can choose what they like. It is more effective. The culture is rather the same in both companies. Both have informal culture giving a creative environment. Microsoft has many lawsuits against it, while Google has very negligible number. Google is able to maintain its reputation while Microsoft's reputation is declining. Google has strong ethical policies, while Microsoft needs to have strong ethical policies. Both companies have instilled the culture in their products.
Microsoft and Google both have efficient leaders. Both the leaders exhibit visionary leadership. They have their visions in place and enable their employees to achieve that vision.
Google is definitely in the top companies today because of its culture. Google has large number of employees. It provides many facilities and benefits to its employees.
As analysed above, the huge number of benefits and perk has led to motivational factor for Google employees. But is it really so? Let's analyse the situation here. Providing too many benefits can also be distracting to the employees. Work may be hindered because of less concentration at work and more concentration on other activities like playing volley ball, ping pong, spending time at massage centres, and what not. These can actually reduce the concentration. Too many motivating factors are dangerous. High motivation can become a destroyer if it is in the form of desperation, fear or an obsession with being successful. (Jones, 2010) There can be another problem with it. Even though Google has strict procedures for hiring there might be people who get hired and may be there only just to seek the benefits. This can also hinder the progress of the company. The budget of Google is mostly spent on these benefits which can lower the revenues.
During recession, these benefits were reduced and this caused dissatisfaction among employees. For few of them it was a demotivating factor. The attrition rate increased then. Google should not let this happen again because it may lose bright people. It may cause dissatisfaction among employees which can lead them to not to perform their task at all. Google must be careful in providing benefits. They can still continue to have creative workplaces.
As Google allows its employees to have 20% of their time on interesting projects, there may be chaos in managing this. Because of diverse workforce, lot many creative ideas may be raised. But ultimately the best one will be chosen. This may cause conflict among employees leading to undesirable situations. They must have a process in place to see that every employee's ideas are valued.
Edward E. Lawler III emphasizes that 'treating people right is fundamental to creating organizational effectiveness and success. It is also easier said than done.' Thus, as stated it is the culture at Google which knows how to treat its employees and users. The numerous benefits and rewards to the employees have definitely increased the performance levels in them. The more the employee is motivated, the more loyal are they to the company. Google has a complete creative environment that depicts in their offices. Ping pong tables, rooms filled with snacks, lava lamps, scooters etc. kind of provide college atmosphere. Such environment enhances creativity. There is no company which can be called perfect but definitely Google is the company which is almost there.
Larry Page and Sergey Brin have instilled an entrepreneurial thinking in their employees. This has led to innovative culture. Google has made efforts in creating such culture to get their employees committed and satisfied. In the long run, how Google would perform with this culture is what we have to wait and watch.