Google Internal Environment and PESTEL Analysis

Google inborn Environment and PESTEL AnalysisABSTRACTThe purpose of this vomit is to strategically break a multinational company of our choice. Our case study is Google Inc. which we will analytically break down, using various sources. We chose Google because we found really interesting receivable to the feature that non only it is the biggest internet assay locomotive to date, exactly also a pi matchlesser in its industry. Based on alive literature and sack references, will try to analyze its internal and the away environment.INTRODUCTIONGoogle has occupied the dominating position in its industry since the offshoot referable to its unique product which is a conduce of its unparalleled work environment. It has gone on to attain the deepst sh be of the online search engine merchandise as it provides its users with a product that is difficulty substituted blush though on that point atomic number 18 legion(predicate) competitors. By analyzing the internal and ext ernal environment of the corporation, it is intelligible that Google is running a well oiled machine, paying aid to withal the least signifi fecest detail in order to ensure that it provides a prompt and rock-steady product to its guests.HistoryGoogle was founded around 1995 by Larry scallywag and Sergey Brin while they were still university students. The idea was establish on pages PhD research project called Backrub. This involved mathematical properties of a link structure on the internet. Having indexed any speckle 50 million mesh addresses, Google was formally incorporated by 1998.it has such significant influence that a company could either capaciously benefit, or be seriously harmed depending on the search rankings. Besides being the fall search engine, Google features different functions such as Gmail, Google Earth and Google Docs. provided, Googles extreme get hold ofment and constant expansion and development argon imputable to their unparalleled workings e nvironment which not only aims to keep e rattlingone happy, but roaringly does so. (Google, 2011, Keller et al, 2008) privileged ENVIRONMENTResources Capability TheorySourcesThe combination of sources and capabilities, defines a good schema of a company. Google achieved to combine ideally its sources and capabilities, as we can see that its scheme, is working. Ones company resources can be separated to tangible, nonphysical and compassionate. Referring to Googles tangible resources are the financial sources from advertising companies, raw materials, mechanical equipment, modern facilities, innovative design of homepages and hardware. As for the intangible resources they are, luxuriously applied science, worldwide reputation with users and suppliers , strong brand plant , huge information-base, patents desire Google Earth and eco friendly Blackle. both(prenominal) other authorized intangible concomitantor is the business culture of Google which does not only care m uch or less the service of users but also cares about vast working environment. More all over as for the human resources, Google has a large amount of high-skilled and capable staff. Further more, another(prenominal) important component of Googles success is its know how which cant be imitated by any other rival firm. In concomitant all employees are experienced in the commercialize of information based serve. Google has strong leadership combined with training which declarationed in loyal staff. (Christodoulou, 2010, David 2007)CapabilitiesThe combination of sources, tangible, intangible and human resources create the appropriate capabilities. Capabilities separated as marginal capabilities which cannot easily imitated and primal capabilities which can. By combining its resources, Google creates some very effective capabilities. Flexibility, quick result and speed of distributing the information are produced by the combination of huge entropy base with the highly advanced software. These capabilities are fundamental because they cannot be copied easily. Another fundamental capability of Google is innovative and effective human resources management. This is also a result of good leadership with highly skilled and specifically instruct staff. Furthermore, the combination of human resources with the software and excogitations has the result of design capability, which is imitated. The right transmittal of information between leadership, employees and the culture of Google results in good communication, as a fundamental capability. The combination of the right organization in human resources with the schedule system creates the fundamental capability of quick responsiveness to nodes. (Christodoulou, 2010, David, 2007)Competitive gainValueGoogle provides a high value product which satisfies its consumer require, whatever they whitethorn be, quickly and efficiently. A costumer can use its search engine when looking for information on literally anyth ing as well known, or not, that would be. This is what keeps it in its market dominating position as the leading search engine as it provides such a rare product. Furthermore, Google uses a weapons platform call AdSense which is vital I order for businesses to generate income. This is due to the fact that there is more traffic, hence more exposure, which consequently leads to an cast up in sales. (Morrow, 2009, Thompson and Strickland, 1998)RarityGoogles rarity can be seen even on its homepage which is irrelevant any of the rival companies. There is a 28 word jump policy for the homepage, meaning that it is the only one that which is completely clutter free, let customers focuses on what they want to use the product for without any distractions. This in bend shows that Google inc. wants to provide a high feeling product that meets consumer needs, rather than toilsome to gain meshing from annoying barements .Furthermore, the relevancy of the results of the search engine dir ect it evident that Google succeeds and r for each onees its aim to provide a product of the highest quality for each customer. Compared to its competitors, yahoo and Microsoft, it is the or so efficient and accurate when providing a consumer with the result. (Morrow, 2009)ImitablilityGoogles unique homepage has not been imitated by its competitors due to the fact that they are more interested in what consumers need to feel relaxed using this search engine, rather than profiting from advertisements. In addition even if competitors try to imitate Googles results, they would require an enormous database, extremely straightaway computer memory, and servers all around the world. Furthermore, Google try traces what you search each condemnation and in a way gets smarter in order to provide you with the most relevant results each time you search. It basically can tell what you are looking for even the word which experience been used has more than one meaning. (Morrow, 2009)Substitutabi lityThe fact is that Google has substitutes, such as Yahoo, Microsoft, Ask and Bing however it continues to overcome the market as it provides the best product and therefore gaining strong customer loyalty. (Morrow, 2009)Value chainDue to the fact that Google provides information based operate, which is a nonphysical product, its value chain differs from the traditional form. Their raw materials are the web users who use Google to search. The comparable users are then directed by schoolbook advertisements into their advertising partners websites where the sales occur, which is also the finished program. Furthermore, the search engine works in such a way that it keeps record of the users previous searches in order to provide more relevant results in future searches, which in turn means that web users are directed to websites where there is more probability that purchases will occur. In addition, due to highly skilled and fitted staff, the dependency of primary activities on hum an resource is quite high and so causes an summation in costs. Operations, sales, distribution and services are conducted with the aid of Googles servers and its internal software, all of which contribute to the value chain as they increase the firms profit. It also spreads its operations globally in order to be eternally aware of changes which in turn help Google maximize its profit. (Morrow, 2009)Mission program lineTo organize the world information to make it universally accessible and utile From this statement we can see that Google Inc is not interested in profit maximization but strives to meet the needs of its customers with a high quality product. Also Google states that sharing information and giving access to it, so that either person in the world could find whatever he needs from a source of his preference. (Morrow, 2009)EXTERNAL ENVIRONMENTPESTELPoliticalAs for the governmental environment, Google has few political restrictions. Firstly, one of the political probl ems that it faces is with the Department of Justice, due to the fact that there are plenty of inappropriate content and classified documents. Secondly, it has problems with the Chinese Government, because of censorship of searching results. Google tries not to have problems with censorship globally, because of its cooperation with the U.S Government and the egis of personal privacy. For this reason, it has created privacy terms on its homepage, where users can find information. In addition, many countries of Asia have limitations on what can be searched, but broadly speaking the majority of countries around the world do not have restrictions. (David, 2007, Morrow, 2008) frugalNowadays, there is an economic crisis all over the world witch importantly affects global sales. Furthermore, one of the countries that have been hit the most are the fall in States, where Google is located. However, this crisis has not affected Google, because it does not sell direct products, but services which are funded by advertisements. Also, the free provision of Google leads to an increase in its popularity, which in turn primary(prenominal)tains its good relations with advertising firms. Finally, its excellent knowledge of the market al first-class honours degrees Google to be able to respond to any kind of crisis. (David, 2007, Morrow, 2008)SocialGoogles great reward is that there are no social restrictions, because its services can be used by everyone despite age, religion, nationality and living conditions. Another advantage is that is not a seasonal company, for the reason that its services are everlastingly desired. Also, the development of engine room and the trend of using Internet through computers and prompt phones have increased in the last geezerhood, impacting Google expansion all over the world. Google has no geographical dependence because the technology of internet is widespread worldwide. An moral of geographical power is that more than 115 countries use Google, many of which are not economically developed. Googles social environment is global, meaning that is a Multilanguage society. For this reason, Googles services have been translated into numerous languages. Furthermore, it allows access to sites which may be inappropriate or appropriate. However in many countries there is a prohibition to them due to cultural and religion differences. (David, 2007, Morrow, 2008)TechnologicalThe technology is always advancing, so this phenomenon makes Google lead rapidly. For this reason, it has to be updated endlessly in order for it to conserve its revolution. New technology in computers systems may aid Googles services to work faster and better, so it has to prevent its opponents from taking this new technological knowledge. Another advantage of technology for Google is that the costs are decreasing, while the quality of the services that it offers is improving and the innovation are strengthened. It also emends the speed of informa tion, the ways of communication and transportation. These reasons help Google to lose ones temper and more important to survive. (David, 2007, Morrow, 2008)LegalThe legal environment is an issue that concerns everyone who uses the Internet. copyright is an issue that exists in legal environment because of the ability that third party persons and companies can copy pictures and steal information from others. As a result, Google has created a page with copyright information about what is legal and what is not. (David, 2007, Morrow, 2008)Five ForcesAs always analyze of five Porter forces play very important role for the study of business elements and contributes to develop the right strategy to be able to survive and become more competitive. (David, 2007, Morrow, 2008)Entry BarriersRegarding the search engines, they have accumulated a large amount of information on customer service. Therefore, Google updates its material, in order to compete with other online search engines. For a fresh introduced company it is necessary to serve and meet its customers expectations and the services should be provided at high speeds with flexibility in search. When Google was established around 1998, there were other similar companies like Yahoo, AltaVista and Excite, which had big influence in the market place but Google achieved to dominate. The web environment of search engines is more enriched, compared with the past years and its more familiar for users. As a result, the entry of new firms is not such a big threat for existing companies, especially for Google. (Morrow, 2008)SuppliersThe main suppliers of Google are advertisements of companies, which expect to be popular in the world, so this factor contributes to the direct profit. Therefore, the negotiating power of suppliers is relative low, because Google is the pioneer of searching services. Over the years, technology evolves rapidly and because of it, Google achieved to install new software in mobile phones. only in this case the negotiating power is very high, because there is other companies software, like Microsoft with more experience in the market place. (Morrow, 2008)CompetitorsThe main target of Google is to be able to face the competitiveness and become dominant company in the world of search engines. The main source of income is based on advertisements, due to reliable information that is collected daily. Since 2007, Google noted an upward evolution with yearbook profit rate at 110%. The main competitors of the company are Microsoft and Yahoo which have significantly lower profit. For the achievement of their profits, trademarks like MSN and Live-search contend very important role. The companys high market share gives it the advantage to improve the quality of information and make the search easier. As a result, Google creates successful advertisements rapidly in proportion with its competitors. (David, 2007, Morrow, 2008)CustomersSince 2007, almost entirely, the profits of Google come from advertisements. The strategy of the company is to obtain new and more advertisements, of which the profit is maximum 3%. So it accumulates the profit from many small advertisements. Many firms want to advertise themselves and users have the opportunity to find them through keywords. Then, the percent of profits increased, because it is considered as an extra service. This attracts many companies which results in Google buying power in low levels. (David, 2007, Morrow, 2008, 1999)SubstitutesIn recent years the world of Internet is the first pickax for the users, who search direct information. Due to the uniqueness and immediacy, there arent specific substitutes for data search. In order to Google to serve the users and become more competitive, with the help of some tools, classifies the data by date. The leading position of Google and the possible future unveiling of competitors depend on the satisfaction of customers and shareholders. (David, 2007, Morrow, 2008, 1999)Com plementaryThe complementary goods are direct connected with services of Google and depend on them as these are movable computers and mobile phones. Generally, it is an industry with restricted amount of complementary goods. (David, 2007, Morrow, 2008, 1999)SWOT abbreviationStrengthsThere is a wide range of functions offered such as Google docs, Google earth, Gmail, Google spokesperson and Blackle, besides its main operation as a search engine. bully reputation and strong brand nameLoyal customersGoogle has developed very well its know how,Googles efficient and prompt resultsPay high attention to the usersUnique product-serviceFriendly working environmentDoes not distract its users by flooding the homepage with advertisementsWeaknessesThe requested search does not always coordinate with the resultsYou cannot always find the information that you want in the fullest extentThe information is mostly in EnglishHackers create many dummy site with netmailWhoever is interested in using Google for advertising purposes does not have a clear idea where it would be more profitable to place their advertisements as the cost or click charging is very confoundThere is a lot of useless and invalid informationOpportunitiesGoogle can expand by mergingUsing higher value context on the webCan increase the internet usageCan local vendors advertisements on every local searchIt can provide more handheld devices to capture a larger share of the marketIt can increase the advertising spending onlineThreatsThere are a lot of competitors and rivals security reviewA lot of legal trials due to users invasion of privacyThe confusing policy for advertisements may disappoint the potential clients and Google may start losing themIf it decides to follow its competitor by changing it minimal user friendly port it may lose a lot of its usersPrivacy issues regarding the contents self-controlIt can lose its brand loyalty if it merge with other large firms(David, 2007, Thomson and Strickland, 1 998)FINANCIALGoogle is a company that has increasingly become popular since 2004. In recent years it has achieved to increase its incomes that helped it become a profitable company. Googles tax revenue is 99% from advertisement, because the products that it sells are free to use. According to the financial statement, Google is better than its main competitor, Yahoo because, it has 2.4 times more of its revenue. Additionally, Google is more profitable than Yahoo as it manages its debts better. In recent years, Google has slowed down the sales growth, income growth, assets growth, the profit Margin and the give-up the ghost of assets as we can see in table 1. However, it is still at a good level and it does not declare to be in a downward path, because it is still first in sales. This is a result of its steady growth, as know that no company can achieve an upward course. Googles revenue is increasing annually, even if it is not at the same rate as previous years, however, it has nev er been less. (Morrow, 2009)CONCLUSIONTo sum up, throughout its progress, Google has kept its dominant position over its competitors in the information based services industry. Furthermore, it is very important to note that Google has not only been conformable when it comes to providing a product of the highest and quality, but is also constantly developing, adapting, but more significantly revolutionizing the industry. In addition, what makes Googles product so unique in comparison to its competitors is the attention that it gives to consumer needs in order to provide a reliable and difficultly substituted product rather than focusing on maximizing its profit with every given chance which may compromise the quality of its search result its product. Having analyzed the corporations internal and external environment it is evident that Google pays attention even to the smallest detail to ensure that it will be the leading company amongst the numerous other online search engines and h as been able to create loyal customers that are constantly increasing.SOURCES-BIBLIOGRAPHYMorrow, B. (2009)Internal Analysis of Google Inc., 22 February, 2009. Available at http//www.benmorrow.info/research/internal-analysis-of-google-inc Accessed 5 January, 2011Morrow, B. (2008) outdoor(a) Analysis of Google Inc., 15 October, 2008. Available at http//www.benmorrow.info/research/external-analysis-of-google-inc Accessed 5 January, 2011Google (2011) caller-out Overview Corporate Information.Christodoulou, I.P. (2010) Strategy Strategic instruction Perspectives. PowerPoint slides Lecture handouts. University of Hertfordshire.22 December, 2010Keller, K.L., (2008) Strategic crisscross Management. A European Perspective. 1st edn. England Pearson Education LimitedDavid, F.R., (2007) Strategic Management Concepts. 11th Ed. Upper Saddle River, New Jersey Pearson Prentice hallwayThompson, A. A. Jr and Strickland, A. J III (1998) Strategic Management Concepts and Cases. 10th Ed. USA Irwi n/McGraw knoll (International Edition)