Corporate Entrepreneurship and Innovation in Silicon Valley: The Case
of Google, Inc.
Author: Finkle, Todd A. Source:
Entrepreneurship Theory and Practice, Volume 36, Number 4, 1 July 2012 , pp.
863-884(22)
Do you know which company is the most
innovative high tech company in the world? I believe Google is really top tier innovation
company. Everyone uses Google's products almost every day, such as Google Search,
Google Map, YouTube, and Gmail etc. Moreover, Google still dedicates in
developing innovative products and technologies to change our daily life and improve
the world. What are Google's keys to success? This article tells you how Google make success
through its innovation and entrepreneurship strategy. This article is very
important because it is the real world case that you can learn a lot from it about
how to use innovation strategy to make business successful. It is also a
benchmark for the managers to follow when they operate their companies.
Three factors contribute to Google's
innovation. The first factor is culture. Google established a culture of open innovative
environment to encourage people to generate
new ideas and creations. The second, Google has a "Less-layer" management
system and many reward programs including high paid salary, stock options, employees
services such as free dinner. This kind of system supports people to create,
and make innovation more effectively and efficiently. The third factor, the
most important one, is people. Google hires the smartest , highly
self-motivated people in the world. They have the capability to innovate and
create new products and technologies.
The author provided supports to these
findings by analyzing the economic, competitive environment, through abundant evidences including Google's financial
statements, stages of growth, pictures, and entrepreneurs' and employees'
interviews. For example, the Table of Google's Corporate History showed a list
of innovations from its founding year 1998 to 2008. These innovations included releasing
Google Toolbar, Adwords, Google Maps features satellite live view, Google Earth,
and Google Apps and so on. Google’s philosophy is “Never Settle for the Best.” Google's
20% free time policy allows employees do whatever they are interested in. The author
also analyzed Silicon Valley region's education environment and high tech
companies as well as Google's hiring
process. A picture of the employee's work table shows abundant materials to
help recreate new stuff. All these evidences strongly support above finding.
The implications for practicing managers
are that you should think about if you create an environment for employees to try
new things and ideas when your company wants to use the innovation strategy. You
should ask yourself if your business internal mechanism and structure matches
with the innovative culture, and encourages this quick change. Lastly, the
managers should be aware that people is the most important factor in innovation.
I feel that a key differentiator that puts Google ahead of its competition is that they are a customer centric technology company with a keen eye towards making money, which is a great way to grow a technology company.
ReplyDeleteFrom what I have read it seems that they believe in optimizing the user experience by building an innovative brand revolving around innovation and thus captivating their audience. And a great example of this is Google’s targeted advertisement service.
Yes, I agree. Google definitely has a customer oriented approach to how they run, similar to Facebook.
DeleteLuna, I definitely agree with the points made in article you reviewed this week. Matching culture to strategy for innovation is key. Without a culture that embraces the high risk nature for going out on a limb to realize the benefits of leaning forward, then people regardless of their inherent capabilities will be less likely to do so.
ReplyDeleteCompanies and their leaders do need to shape their strategies around a specific culture. Likewise, they can also create the desired culture to achieve a certain goal.
Deletei really like the idea of 20% free time policy.
ReplyDeleteI think it is a really good idea as well. This takes the pressure off of some of the engineers to come up with innovation because oftentimes people can come up with more creative and effective projects when they are relaxed. It would be interesting to see the same concept apply to education.
DeleteOpen innovative environment seems like a great fit with a tech company like Google. Just look at the mountain of resumes that flood HR. I do think, however, that this model works well in some areas and less in others. An industry with a demand for structure wouldn't be as good of a fit, like say the Army. Good read though.
ReplyDeleteThis idea is definitely more geared toward innovation oriented organizations. The army would be ineffective if discipline is not emphasized. In areas like education, on the other hand, the line is blurry. Some people take initiative to learn on their own while others would not.
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