Google is one of the most well-known and respected companies in the world today, but even strong, stable companies have a host of different issues to face. While Google is in tremendous position to outpace its competitors moving forward, it still faces some threats and has to deal with some weaknesses. These things, however, are balanced out by the strengths of the company’s brand and its leadership team, and they are mitigated by the tremendous opportunities for growth and progression that currently exist for Google.
Strengths
One can hardly discuss the strengths of Google without first leading a discussion on the company’s personnel. Google has a very strong and highly respected leadership team, but its staffing strength goes well beyond that. Because the company offers tremendous benefits and a productive working environment, it has been able to attract some of the best talent in the tech industry (Craig, Thomas, & Pham, 2008). The company routinely recruits from strong start-ups and other individuals who have shown themselves very impressive in their fields.
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From a technical perspective, Google also has a strong stable of patents (Bohannan, 2012). Intellectual property has legitimate value that can be leveraged, and because patents are protected by law, this gives Google an extended operating advantage over its competitors. To that same end, the company’s “open source” concept has made it very popular with Internet users the world over. This has given the company access to a much wider group of potential consumers, which is one of its primary strengths.
Weaknesses
As with many things in the business world, a strength can also turn into something of a weakness. For Google, this means that the company is almost constantly under siege from competitors looking to weaken its patent profile. Patent litigation can be expensive and time-consuming. It also threatens to bring the company down in the mud when the company could otherwise be looking for new opportunities to innovate. The amount of patent litigation that Google is forced to participate in is a weakness of the company.
Likewise, one of the company’s weaknesses is that it relies too heavily on one income stream. Google is attempting to branch out by offering new products and services, but as it currently stands, the company is far too reliant on advertising revenue. Its open source concept makes its products and services free to use, but Google also misses out on valuable revenue sources when it only uses a one-revenue model.
Opportunities
One of the primary opportunities for Google lies in the fact that more and more people are getting involved in mobile computing. While having a smart phone made one unique a few years ago, it is the norm now. Phones continue to get cheaper, and more than that, they continue to develop new capability that Google can take advantage of. As the base of mobile Internet users – through tablets and phones – continues to increase, Google should have opportunities to secure even more market share. After all, the company and its goals are well-aligned with Apple, the company that produces some of the most popular mobile Internet devices on the market today.
Likewise, Google has a significant opportunity to branch out as robotics becomes the norm over the next five to ten years. Google has spent significant time working on a driver-less car that can safely and efficiently move people and cargo from one place to another (Priddle & Woodyard, 2012). As it currently stands, there are many industries – the taxi industry and trucking industry being chief among them – that rely on human drivers to get from point A to point B. Driver-less cars could save companies a tremendous amount of money, and Google would be in position to cash in if this trend continues to grow. Over time, as the technology becomes better, Google may be able to market this technology to major auto manufacturers for mass consumption by the driving public.
In addition, Google’s tremendous financial position puts it in a place where it can continue to buy and acquire smaller companies. By doing this, Google can acquire even more patents, which will be highly important for companies looking to leverage the future. Google is in better position to do this than many of its competitors because it has the market capitalization to take some risks heading into the future.
Threats
While the growing number of Internet users might be seen as an opportunity, it is also a threat. Google will need to come up with new ways to monetize this part of the market. When using a tablet or phone, these users see fewer ads, as Google has had a difficult time displaying ads in a manner that will not be cumbersome for users.
Google faces a threat from the EU in regard to its business practices. It is being accused of anti-trust violations in the way it handles the Internet search market. This could potentially harm the company from a financial perspective, but more than that, it would make it more difficult for Google to have success moving into Europe and other parts of the world. This is a situation to keep an eye on as Google continues to grow more dominant in today’s marketplace.
Google faces a threat from another of the major tech players that has a strong brand and strong leadership. Microsoft is that company, and though Microsoft does not directly compete with Google on a number of products, it is starting to creep further and further into Google’s territory. Few companies can match the reach and influence of Google, but Microsoft might just be the exception to that rule. Still, Google’s internal environment gives it an opportunity to maintain an advantage over all competitors, including Microsoft.
- Bohannan, C. (2012). Copyright Harm and Injunctions. Cardozo Arts & Ent. LJ, 30, 11.
- Craig, E., Thomas, R. J., & Pham, C. T. (2008). Multiplying Talent for High Performance. Accenture Institute for High Performance research report, 23.
- Priddle, A., & Woodyard, C. (2012). Google discloses costs of its driverless car tests. USA Today. Retrieved from http://content.usatoday.com/communities/driveon/post/2012/06/google-discloses-costs-of-its-driverless-car-tests/1.
