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The concept of entrepreneurship has a wide range of meanings. On one extreme an entrepreneur is a person of very high aptitude who pioneers change, possessing characteristics found in only a very small fraction of the population. On the other extreme of definitions, anyone who wants to work for himself is considered to be an entrepreneur.
The words creativity and innovation are used almost interchangeably. Some people believe you have to be creative in order to create innovative things. Others would say, without innovative thinking there is no creativity.
Creativity is defined as the ability to transcend traditional ideas, rules, patterns, relationships, and to create meaningful new ideas, forms, methods, interpretations, etc.
Innovation is defined as the act of introduction of new things or methods. The act of starting something for the first time or introducing something new.
Successful entrepreneurs combine creative ideas and superior capacity for execution. The entrepreneur's creativity may involve an innovation product or a process that changes the existing order. Entrepreneurs have a unique insight about the course or consequence of an external change. Entrepreneurship is the driving force of creativity and innovation. Innovation creates new demand and entrepreneurship brings the innovation to the market. Innovation is the successful development of competitive edge and as such, is the key to entrepreneurship.
The current economic environment is a volatile and violent one. The new environment demands renewed dynamism of approach. Only the discerning organizations can manage the changes inherent in the new environment. It is the duty of the entrepreneur to keep his organization lean, young, flexible, and eager for new things to continuously delight the customers, which is the purpose of every business.
Google Inc. is a publicly traded company headed by CEO Dr. Eric Schimidt, specializing in internet searching and online advertising. Google was co-founded by Larry Page and Sergey Brin while they were students at Stanford University, and the company was first incorporated as a privately held company on September 7, 1998.The two founders Larry Page and Sergey Brin both play active roles in decision making process. The business generates most of its revenue from keyword based advertising.
Google's mission statement is " To organize the world's information and make it universally accessible and useful".
Google is split into two major means for producing revenue for the company. Services that the company offers to major corporations for search services as well as those offered to mobile companies. And fees that are charged to companies for the purpose of advertising based on related text searches from it search engine site. Google gains much of its revenues from advertising. This advertising comes from many sources, but most notably from its search engine page. Customer use a product called Adwards. Adwards is a service that Google offers that allow customers to create their own ads based on the text those they wish their product to be related to.
The second form of major advertising that is used by Google is a means to extend the network of its advertising. Companies can implement a service by Google called Adsense. Adsense is a way for companies with web pages to add advertisement to there WebPages as a means of offering products relevant to the customer search who visit their site.
Google is a globalized company with 51 offices spread throughout the globe with 25 of them not located in the U.S. Google has indexed pages from as many as 238 different countries throughout the world. Many of these offices that are around the world are for their purpose of developing the search page in the native language and also to further promote the sales for the countries that use the native language of that country.
Google tries to retain its employees and evaluate them in a quantitative but also qualitative manner. In fact, the company made its work environment colorful and has created a fun place to work through what it proposes. For example, employees can have free snacks or bring their pet at the office or go to the gym etc... Employees can benefit from flexible working hours and have some time for their self-directed projects which shows the importance of the creativity and innovation from each individual and in every department. Moreover control is done through informal and implicit mechanism. Communication is open across the organization. There aren't any managerial hierarchies or management structure, which gives the employees complete freedom. Even though employees can make their own decision to rectify if something is wrong on a product, decisions usually occur in groups and are based on the principles of full information sharing. Plus, the concern for people goes beyond the individual at work and extends to the individual's interests, hobbies, beliefs etc. This can be seen especially during lunch at the cafeteria. Nevertheless Google emphasis team goals over personal ones.
Google`s organizational structure can be defined as an organic structure. This type of structure is characterized by flexibility, empowerment and teamwork. It emphasizes on the fact that workers are emotional beings. This structure is non-hierarchical and cross-functional: there aren't any barriers between the different departments. People are encouraged to get involved in other activities. Also the top management leaves their office door open in order for workers to feel free to come and talk directly. Google's employees are rewarded for their hard work, Google provides an extremely relaxed environment that encourages creativity through social events such as roller hockey. This permits one to meet everyone and stay as a team.
Google's leadership style is more of a democratic style, that is to say: "what do you think?" the goal is to get people involved in their work and in the leadership process. Here, the participation of each Googlers is important because it forges consensus. The leadership then becomes a team leadership.
For example employees in groups of approximately three people can have their own project and think about the best solutions to adopt. The project leaders rotate within the team.
Moreover leaders show us the importance of creativity and innovation in the case study. Each Googlers have to spend a fraction of their day on R&D and an internal web page has been created to track down new ideas. By the intranet anyone can comment or test the idea then each person can defend their idea in a meeting. If the others are convinced then the idea becomes a project. That way, individuals feel very committed to their work. In fact, by spending time on getting people's ideas the leader builts trust among its team.
In order to improve creativity, Google implemented a participative leadership. This means that everyone in the company brings ideas and share opinions on the company's intranet.
This system makes the employees feel considered and valued, and increases their motivation. Moreover, employees who took part in the decision making feel they own a part of the project and therefore are more willing to work on it.
Google's R&D teams having to solve complex technological issues, using this democratic and participative structure allows workers to share their opinions, ideas, suggestions, and therefore be more efficient in the creative process.
.0 Google's Strategy
Burgelman and Rosenbloom (1989) relate strategy to actual actions rather than planning; "the reality of strategy lies in its enactment, not in those pronouncements that appear to assert it."
Google's strategy focuses on diversification and innovation which have ultimately lead to an emergent strategy.
Johnson and Scholes (2006) state related diversification as a strategy development that seeks to expand beyond current products but within an 'industry' to attract new customers. Google have followed this strategy route by keeping within their 'Information Technology' industry, yet diversifying the products and services that they offer. Google have stayed with their core competence '' Google.com, yet have successfully launched new products off the back of their search engine's success and brand name (see figure 1).
As mentioned before Google places high emphasis on development and the skills of their staff. Diversification enables Google to use the resources, knowledge and skills it already has and use them to expand their business in different outlets. Using the Google brand name and image to launch new and diverse products allows customers to identify Google's strong brand image to the new products, allowing for easier and successful launches of products.
Diversification also allows Google to spread the risk - avoiding total reliance on one product; however Google still rely heavily on google.com (search engine) for the majority of their advertising revenue.
Figure 1: Google's products and services.
"An innovative business is one which lives and breathes 'outside the box'. It is not just good ideas; it is a combination of good ideas, motivated staff and an instinctive understanding of what your customer wants" (Richard Branson, 1998, cited in Bessant and Tidd, p.11). Google seems to embody this statement of what an innovative company is, it is continuously developing new ideas to improve the user experience.
Bessant and Tidd (2007) state that "Innovation is driven by the ability to see connections, to spot opportunities and to take advantage of them" (p.6). Moreover Innovation isn't just about creating new markets- it can also provide new ways of serving established ones. Google has proved that it follows an innovative strategy through the new ways in which serves its markets. Its programs AdWords and AdSense have dramatically changed the way companies advertise and enhanced its offering of online advertising.
With successful innovation there is a need to actively manage the process and thus Bessant and Tidd (2007) suggest three core themes to innovation:
â€¢ Generating new ideas '' Google places high emphasis on research and development so that new ideas can continuously be generated. Furthermore Google allows and funds employees the time to work on their own individual projects.
â€¢ Selecting the good ones '' Google Labs allows new prototypes to be tried out and tested by the public. This way Google can identify failures and winners quickly.
â€¢ Implementing them '' As already mentioned before, Google has a very strong brand image and market position, allowing them to launch new products using the Google brand.
The challenge with innovation is dealing with an uncertain world by constantly trying different and new things, Google actively seeks to try new ideas. Keith Hammond (2003) spoke to Google employees to see how they developed and created new services. One employee '' Urs Holzle proposed that Google don't see failure as a bad thing, "you know why you failed, and you have something you can apply to the next project".
Gilbert and Bower (2006) suggest that whilst companies might have an intended strategy, the strategy that is actually realised can be very different. One cannot know exactly what will happen in the future; if an organisation's strategy was intended and so had perfect realization then Mintzberg (1994) states that "it implies brilliant foresight, not to mention inflexibility, while no realization implies mindlessness. The real world inevitably involves some thinking ahead of time as well as some adaptation en route" (p.24). This is relevant to Google, whilst they may have a strategy designed for innovation and diversification, it still leaves room for change. With the innovative nature of Google, emergent strategy is the most suitable as it allows for new routes to take places.
De Wit and Meyer (2004) propose that emergent strategy is "the process of becoming apparent" (p.113), and that the strategy will emerge when it "comes into being along the way"(p.113); it will expand from ad hoc behaviour. This is demonstrated by Google's attitude towards research and development. As already said, Google funds individual projects for employees, which may result in an unexpected new product or service, however this funding may end up wasted due to failure of projects.
De Wit and Meyer (2004) give certain advantages of an organisation having an emergent strategy; as the future is unknown and so unpredictable, Google has been able to keep hold of sufficient 'mental freedom' to pursue unforeseen opportunities as they appear. Additionally there is the advantage of flexibility, with emergent strategy Google are able to keep their options open, by not committing themselves to unalterable actions. As already mentioned, emergent strategy is viewed as 'learning by doing' and De Wit and Meyer (2004) suggest that learning is often the best way to find out what works; to "give it a try". Again this is very much the case with Google and s demonstrated by Google Labs and allowing the public to test new prototypes.
Eisenhardt and Brown (1998) argue that while, traditionally, strategy was "about building long-term defensible positions or sustainable competitive advantage", today strategy must focus on continuous adaptation and improvement and be "constantly shifting and evolving in ways that surprise and confound the competition". Google has been able to stay ahead of its competitors by adapting to new products and services that its own developers create and patent.
From my analysis of Google I have found that the company has a strong business model; as demonstrated by its high level of revenues. Furthermore its combined strategy of innovation and diversification has lead to a successful emergent strategy. Due to its strong technological infrastructure, Google has a competitive advantage over its competitors with programs such as AdWords and AdSense enabling them to make high levels of profit. Moreover Google's high emphasis on their employees has lead to new ideas and service being created and patented for Google. Google is best suited to an emergent strategy as it allows them to adapt to competition and new opportunities quickly which is key in this rapidly changing environment. As long as Google continues to be innovative they should be able to stay ahead of their competitors and continue to be successful.
Google is a very unique business that runs its innovation in a very distinct way. After several attempts at structuring their development process, Google has arrived at the 70-20-10 rule, discovered by Sergey Brin. Initially, Google attempted a classical structured engineering process. Google eventually abandoned this engineering management approach concluding that while productivity was high, creativity and innovation were poor. The 70-20-10 principal is apart of their current process, which allows the creativity and innovation to be utilized. Google is not as high as 70% in the core of search or ads, so now they are re-shifting the focus again to adjust. The 20% represents Google's bargain with technical people, allowing them to roam free to encourage creativity, where all the most interesting products emerge. The 10% is for the wacky ideas that might now work out but feel worth pursuing.
The second part of the current process is an "exhaustive drama of arguments and reviews". They want their employees to produce arguments so that all ideas and opinions are out in the open. Lastly the third part of the process is a monthly formal revenue force and reordering around product investment. According to a Google employee, their goal is to systematize anything. The only way to deal with the growth in scale is a systematic approach to each and everything we do. Google's making significant storage, computing capacity investments, reusing and combing data from one application to another. This innovative process allows Google to dominate within their business market.
Google is not like every other company even though they share attributes with the world's most successful organizations, a focus on innovation and smart business practices. As the company continues to grow, it is still committed to retaining a small-company feel. Every employee is important within the company, and what they have to say is integral to the company's success. Google employees thrive in small, focused teams in high-energy environments. They believe in the ability to change the world and are passionate about their lives as they are about their work.
Google's founders often state that the company is not serious about anything but search. They build the company around the thought that work should be challenging, but the challenge should be fun. Google puts users first when it comes to online services and its employees first when it comes to daily life in its offices. Chief Executive Officer, Eric Schmidt, states, "The goal is to strip away everything that gets in our employees way. We provide a standard package of fringe benefits, but on top of that are first-class dining facilities, gyms, laundry rooms, massage rooms, haircuts, carwashes, dry cleaning, commuting buses- just about anything a hardworking employee engineer might want. Let's face it: programmers want to program, they don't want to do their laundry. So we make it easy for them to do both."
One of Google's innovative ideas for their employees is called "Twenty percent" time. The Google engineers are encouraged to spend 20% of their work time, or one day a week, on projects that interest them. Some of Google's services, such as Gmail, Google News, Orkut and AdSense originated from these inventions. Marissa Mayer, Google's Vice President of Search Products and User Experience, stated that her analysis showed that half of the new product launches originate from the 20% time. This is a strategy within Google that pushes creativity and innovation within the employees. Henry Ford once said, "If I'd listened to customers, I'd have given them a faster horse." True creativity makes the impossible possible. It can revolutionize a product, a business, the economy, and the world around us." Google tries to encourage their employees to do the impossible, and create something that could change the world.
Google overall has been one of the most innovative and creative companies in the past few years. Their creativity and innovation has helped them become one of the biggest and most successful companies in the world. It is hard to say what lies ahead for Google. They believe one of their own chief competitive advantages is a surprise. Google's innovation and enthusiastic devotion to their users are the main things that fuel the company. This belief in the company helps create ideas and products that change the world.