Google’s Strategic Shift: Analyzing the Impact and Implications of the Alphabet Restructuring
Review ChapterCase 11 Part II. Then, in a two to three page written response, answer the following questions:
Why did Google restructure itself and create Alphabet? What is it hoping to accomplish? For additional insights, see Larry Page’s post announcing the restructur-ing at https://abc(dot)xyz/.
Do you think the reorganization is beneficial for Alphabet’s moon shots, now housed in their own business unit with profit-and-loss responsibility? Why, or why not? Explain.
Why has Google “failed” to develop other profitable businesses? Is Google’s strategy process of planned emergence to blame? Why or why not? Will Alphabet’s new structure with independent SBUs enable the company to innovate more and to find the next highly profitable business beyond online search and advertising?
Google’s Strategic Shift: Analyzing the Impact and Implications of the Alphabet Restructuring
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Google’s Strategic Shift: Analyzing the Impact and Implications of the Alphabet Restructuring
In 2015, Google reorganized itself and created Alphabet Inc., a new umbrella organization that controls Google and other companies. This strategic move was made because the company wanted to keep its focus on its internet-related services while at the same time allowing its other projects, which it calls ‘moonshots,’ to be free to do as they wish and grow independently.
Reasons behind Google’s Restructuring into Alphabet
The main reason Google decided to reorganize and form Alphabet was to control better the various types of companies it was involved in. According to Adekunle (2023), Google had grown beyond its initial goal of providing organized information on the World Wide Web. It invested in almost every field, such as self-driving cars (Waymo), health care (Verily), and even investment (GV and CapitalG) (Adekunle, 2023). All these ventures had different requirements, objectives, and issues, and managing them all under the same brand was becoming increasingly problematic.
Google’s Objectives for Creating Alphabet
Improved Focus and Accountability
Alphabet made it possible for each business unit to have a clear vision of its objectives since it was spun off from the others as a separate company. According to Harding (2020), every subsidiary can now work more independently, putting the responsibility on the subsidiary’s management to deliver results and profits.
Enhanced Innovation
Alphabet’s structure enables the moonshot projects to have a startup-like culture, which is ideal for creativity and innovation (Rothaermel, 2021). Google’s core business processes do not limit these units. Therefore, they c