Google and It’s Innovation Strategy

------------------------------------------------- ------------------------------------------------- - and how they innovate Magdalena Kron MSIN7013: Innovation Management (Word count: 1321) Abstract This essay is a discussion around Google’s innovative strategies looking at the innovation process, business model and the infrastructure they have built in order to test and deliver innovative products to their users. Table of Contents Introduction3 1.

Brief background of Google3 2. Why are Google Innovators? 4 2. 1 Google’s Strategy of Innovation4 . 2 Optimising Use of Technologies and Merging Services Into One Platform5 2. 3 The Google Platform6 Conclusion7 Bibliography8 Introduction * Today, some people claim that it is impossible to innovate without using the Internet, although this is a rather controversial statement and not entirely true, the Internet has proved to be an excellent distribution channel for innovations to reach a large number of people.

This essay will examine Google and a number of their products to understand why the company is innovative.The discussion will be around their organisational strategies concerning product release, their business model and their powerful infrastructure. 1. Brief background of Google * Google was founded in 1998 by PhD students Larry Page and Sergey Brin; two math fanatics’ with a mission – “to organise the world’s information and make it universally accessible and useful”.

The two students saw a need to differentiate the growing amount of information available on the web and therefore invented a method called PageRank.PageRank was a new technology of organising and finding content online and was patented in 2001. Today, Google offer a variety of products and services, free of charge for their users and the company is ranked as the number one search engine in the UK and US. No one could predict, at the start, the impact Google would come to have in terms of changing the process of online search engines and the range of innovative services and products they would come to offer.

2. Why are Google Innovators? * Innovation emerges from creative ideas that are initiated by an identified need in the market.As the creative thought is developed, produced and marketed the commercial success of the invention determines the innovations impact and success. A company can innovate in different ways and take advantage of several innovative products and services and how Google has managed to do this will be further investigated. 2. 1 Google’s Strategy of Innovation * Google is perceived as a very innovative company, as the company has changed processes and behaviours by understanding the needs of their users.

Google is not a radical innovator; it has have not yet produced a breakthrough technology that creates the emergence of a completely new market. Instead their strategy for innovation is incremental and re-innovative; two terms that will be explained more in depth to emphasise the difference. Incremental innovations are improvements of existing technology within an existing market; i. e. new features to a product are introduced to provide greater value for users.

Re-innovations are products or services that use breakthrough technology within an existing market, commonly but not necessarily, introduced on a new platform. Google search engine can be seen as re-innovation. When Google entered the market, search engines like AltaVista and Yahoo were already established providers. By introducing the new process of PageRank, a breakthrough technology, the Google search engine produced more accurate search result. As a result of this Google quickly grew as users found better value in their service compared to the existing search engines at that time.

Another important aspect of re-innovation is the existing knowledge about the product development which, creates more certainty about the need of the innovation and require less time to penetrate the market than it would take for a brand new product. * 2. 2 Optimising Use of Technologies and Merging Services Into One Platform * Google has a remarkable ability to understand user needs and are also good at creating needs user did not know they had; this is why the incremental and re-innovating strategy is so successful for them.As Google maps was released it was a great additional to Google’s broad portfolio and a useful service for their users. Furthermore, Google Earth and Google maps with street view, has opened up the world to anyone who wants to view it, it is not necessarily a product that users knew they needed but an innovative way to merge different technologies. * Google’s e-mail service Gmail early understood the need of unlimited storage, while other e-mail providers, e.

g. Hotmail. com, only allowed a certain amount of e-mail storage and thereafter deleted data automatically.Google, on the other hand, found ways to provide a storage that continuously grows. Within the Google e-mail account the user also have access to additional features such as calendar and collaborative tools like Google Docs.

Google’s main focus is on their users and the understanding how they can deliver a balance of value, quality and usability. The feeling of a collaborative focus permeates Google’s products and encourages innovation from more than one direction. * 2. 3 The Google Platform When releasing Google Chrome in 2008, the development of this user-friendly web browser was based on open source projects to encourage innovation. This open strategy to innovation is today widely used within technological developments and Google has through its business model managed to optimise this opportunity.

Google’s products and services are free for their users and their profit comes from businesses using Google AdWords and AdSense, tools that Google integrated to give their customers the opportunity to maximise their search hits online.This enables Google to use open innovation without worrying of how to capitalise from it as the company’s revenue model is built on advertising. The reason on why Google’s business model is so successful is because they have managed to create an efficient infrastructure and a platform that users rely on and actively use, thus establishing Google as the ultimate intermediate for businesses to reach out to their target audience online. Google’s services are also flexible and can be embedded and developed by third parties e. g.

Google maps are used by real estate agencies; merging of this sort is called mashups.There is an obvious value exchange in mashups as Google will reach out to a broader audience and third parties can innovate on the use of Google’s products and services. * * Google’s infrastructure and wide acceptance comes with more benefits; its platform also creates a unique opportunity to reach out directly to the users with new innovations to test its commercial fit. Therefore it is evident that everything Google creates is not an innovative success but they have an invaluable tool to test creative ideas before spending more time to develop them.The open approach to incremental changes makes the process of development extremely efficient and a creative idea can be implemented on their platform within a couple of days, to test its commercial fit.

By taking advantage of the million users accessing their products and services everyday Google also collects data to recognize market behaviours and to forecast trends, which can futher increase their understanding of what innovative products could be valuable to the users in the future. Conclusion Google innovative success is built on trying and testing new products constantly, an approach which many famous inventors know the value of.As this essay has focused on the products of Google and their powerful platform, another approach to understand why they are successful innovators could be to look at their unique culture that is built around creativity and innovation. Google is attacking innovation from more than one direction an approach that is essential in today’s fast moving market. Internet is getting incorporated as a valuable tool in many technological devices and Google is following the trend and broaden their portfolio by releasing the Google tablet, a direct competitor to Apple’s iPad.Google has also entered the mobile phone industry as second-movers, and although they have not yet positioned themselves as innovators within this industry it does radiate Google’s fast response to market changes and as innovative opportunities emerges Google are ready to jump right on them.

As Google is extending its platform and challenging big players within other industries they are more likely to continuously be successful innovators and, perhaps one day, Google will release a radical innovation that changes the game completely. Bibliography ------------------------------------------------ Journals * Vise, D. A. 2006. Google. Foreign Policy.

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