Strategic Management: Analysis of Google's Strategy, PESTEL Analysis, Porter's Five Forces Analysis, and Growth Strategies

This article critically analyzes Google's strategy, including its development, strengths, and weaknesses. It also includes a PESTEL analysis of Google's current turbulent global environment, evaluation of balance of different opportunities and threats, and Google's responses to the major issues. Additionally, it uses Porter's Five Forces Analysis to evaluate the strength and attractiveness of the industry/sector that Google is currently operating in, and assesses the growth strategies adopted by Google with the aid of the Ansoff Matrix. The subject is Strategic Management, and the course code and college/university are not mentioned.

Strategic Management

Table of Contents
Table of Contents...........................................................................................................................2
MAIN BODY..................................................................................................................................1
1. Critically analysation of the development of strategy of Google over the years as its Initial
Public Offering (IPO) in 2004. Along with this, it is considered that Google’s strategy has
been deliberate, incremental or emergent. Justification of answer using relevant examples
where the strategy fits one or more of these approaches. In addition, consider the strengths and
weaknesses of Google’s approach. To what extent has senior management been supportive of
strategic developments. Finally recommend how Google’s approach to strategy development
should transform in the future......................................................................................................1
2 (a). Critical PESTEL analysis of Google’s current turbulent global environment. Evaluation
of balance of different opportunities and threats and Google’s responses to the major issues...2
2 (b). Using Porter’s Five Forces Analysis, critically evaluate the strength and attractiveness of
the industry/sector that Google is currently operating in. What is the strength of the five forces
and what underlying factors drive them?.....................................................................................5
3 (a). Using Porter’s Generic Strategies framework, critically analyse Google’s corporate and
competitive strategies. To what extent do you think the competitive strategies are sustainable
over time?....................................................................................................................................6
3 (b). With the aid of the Ansoff Matrix, assess the growth strategies adopted by Google?
What recommendations can you make to Google’s growth strategy for the future?..................8
REFERENCES..............................................................................................................................10

MAIN BODY
1. Critically analysation of the development of strategy of Google over the years as its Initial
Public Offering (IPO) in 2004. Along with this, it is considered that Google’s strategy has
been deliberate, incremental or emergent. Justification of answer using relevant examples
where the strategy fits one or more of these approaches. In addition, consider the strengths
and weaknesses of Google’s approach. To what extent has senior management been
supportive of strategic developments. Finally recommend how Google’s approach to
strategy development should transform in the future
Due to the effective IPO which is developed in 2004 google easily build strong
communication, effective policies and positive relationship with various potential investors or
clients by providing shares and all types of digital facility to them. With help of strong
communication positive relationship strategy organization company easily sustained their profit
margin at higher rate in market for long time (Farrukh and et. al., 2021). From the evaluation it is
determined that it is always comes under the category of deliberate method. Because Google is
one of the companies who always give more importance to the need and wants of customers and
also provide value to their employees. In aspect of justification due to this the growth of Google
are easily stabilized in market and customer mind for long time. In respect of deliberate the main
strength of organization is that they are highly concentrate on the training and development of
employee. Because employees are the most valuable asset for to run their services smoothly.
Employees are also essential for delivering best quality services to customers in long term. In
aspect of deliberate the weakness of this firm is that due run their services in global manner
sometimes their services and services get slow down due heavy use by customers (Keding,
2021). It leads to decrease their performance at large scale. Therefore, it is necessary for the
management of google that they must use advanced equipment’s and strong policies in their
services. Due to this organization easily maintained strong communication with their clients for
long time. In aspect of above-mentioned strategies, the senior management of google are highly
supportive of strategic development. With help of these strategies top level management easily
maintained strong coordination with their employees and stakeholders for long time. With help
of using these strategies the future of the google is become highly bright in aspect of online
mode and various online services. The various examples are Gmail, YouTube, Search engine etc.
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According to these examples google is directly connected with these sources (Fonseca, Abreu
and Silvestre, 2021). Due to have direction with these source services are moved in fast manner.
YouTube is the second largest search engine in the world, and easily the largest user-generated
video platform. Users upload an impossible 100 hours of content to YouTube every minute.
Chrome is far and away from the most successful internet browser, owning over 60% of the
world’s web browser market. And while Chrome doesn’t generate revenue, it generates
mountains of data — and saves Google a fortune. Google is now also experimenting with new
ways of monetizing Maps, both with book an Uber buttons and likely many future locational
advertisements as well. With help of using this type of source the future of google get secured for
long and sustained strong communication with users.
2 (a). Critical PESTEL analysis of Google’s current turbulent global environment. Evaluation of
balance of different opportunities and threats and Google’s responses to the major issues
PESTEL analysis
It is a framework that helps business for purpose of identify macro environment factors that
create negative impact over the operation of the company. It is one of the important analysis
which provides assistance to company about how different factors create both positive and
negative impacts over the operation of the company (de Sousa and Castañeda-Ayarza, 2022). It
is an analysis that allows the business managers of Google to develop strategies for purpose of
overcoming of threats that occur for business in the macro environment and also providing
assistance to them for the purpose of taking advantage of opportunities to occur in business.
There are different factors occurred in this type of analysis including political rules and
regulation, social awareness, development and upgradation of technology, economic growth rate,
environmental regulation, laws and legislation. Explanation of PESTEL analysis in context to the
current turbulent of Google is mentioned below:
Political factors: It is one of the important factors for any business which creates an impact on
its existence. Google is one of the organisations which is operating in a global environment
where different factors create an impact on the work of the company. There is a free trade
agreement in different countries that provides opportunities for purpose of the business of
Google. For instance, due to this agreement, Google is able to facilitate exports to Pixel phones
and also to their apps. Free trade agreement factor results in the opportunities for the business
and create different benefits for the company (Madsen and Grønseth, 2022). Political stability is
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also a situation for different countries which also provides various opportunities for business of
Google. Political stability in different countries helps Google for purpose of attaining growth for
the company in the technology marketplace. Political stability ensures there is no sudden changes
in rules and regulation of the country which allow business for purpose of getting growth in
business. But there are some factors in the political environment which create threat for the
Google. THere are some state-owned companies in countries that are operating online and create
a threat to business of Google. It is one of the important components that reflect that Google
more needs more focus on online as well as other operation on basis of stability in political
environment as well as on the free trade agreement.
Economic factors: Economic factors is essential factors for the business of Google as it consists
of factors like profit, growth, revenue, stability and market growth. It is one of the important
factors which creates an impact on cost as well as income of the company. Economic stability is
essential for purpose of growth of any business. Economic stability in the world economy creates
opportunities for the business of Google as it allows the business to operate in an effective
manner (Bathla, Awasthi and Ahuja 2022). The growth rate in developing countries is high
which is providing opportunities for the business of Google as the purchasing power of people in
these countries is high. There is also a decrease in the cost of renewable energy which also
provides opportunities for Google as it allows them for purpose of improving their service over
time. But due to covid-19, the economy of different countries is facing recession and are still not
able to overcome its impact. It creates a negative impact on the situation of business of Google.
Social factors: It is a factor that is important for purpose of understanding the behaviour of
customers and their buying habits (Grünig, Kühn and Morschett, 2022). There is increasing
social media awareness among the people in the global environment which provides
opportunities as well as a threat for business of Google. Due to this, there is an increase in the
competition in the marketplace as competitors like Facebook also competing with the company
in the field of digital advertisement. But at the same time, this factor also creates opportunities
for the business as it provides growth to the business of social media (Martinez-Contreras and et.
al., 2022). The rising diversities for purpose of online users create opportunities for the business
of google as it allows the business to improve its operation by using tools of technological tools
and innovation. There is increasing awareness among the customers about companies are using
their personal data for purpose of earning money which creates a negative impact on the Google.
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But at the same time, google is ensuring there is only required information of customer is used
and also it helps improve the security and privacy of the company to avoid third party contact.
Technological Factors: Technology is growing day by day which is creating both positive as
well as negative impacts over the business. Technology is one of the important components for
the business of Google which is creating opportunities for the business. There is growth in the
Internet in the developing countries which allow Google to increase the number of users. It
provides more opportunities for the company to earn money in the market (Madsen and
Grønseth, 2022). Increasing use of mobiles devices in the global market is also a positive sign for
the business of Google as it provides a large marketplace. There is also growth in the use of
cloud services all over the world which also boosts business of Google. The increasing use of
technology creates different opportunities for businesses of Google but at the same time, it is also
creating a threat to business. Any technological error can stop the business and create an impact
on the image of the company in the marketplace. In order to overcome of these issues, Google
has made a team that is dealing with such errors and ensure there is no or less convenience to the
users. Due to the advanced use of technology organization is able to deliver their goods and
services to customers quickly. It leads to increase the loyalty of their users at maximum level for
long time. In this way firm easily identified the needs and desires of customers in less time.
Environmental factors: It is one of the important factor for the business of Google as there is
increasing environmental awareness among people in all over the world. People these days
increasingly offering support to the environment which is creating opportunities for the business
of Google. It allows the company for purpose of making products that is based on green
technology (Lord and et. al., 2021). It is also using renewable energy in the marketplace which is
important for the developing presence of the company in the marketplace. But these technology-
based products create rays which is not good for the environment. It is a factor that creates a
threat for the business but Google also contributes to different social and environmental work
which assist the company for purpose of developing a positive image of the company in minds of
its customer.
Legal Factors: It is also an important factor for purpose of the company which includes
different laws and legislation to be followed in an international environment. There is increasing
regulation in context to online privacy which is an important factor for Google as it enables the
company for purpose of gaining the trust of its customers (Choi, Jeong and Kim, 2021). There is
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increasing restriction over the use of personal data of customers but Google is using it for
purpose of earning money. It creates a threat for the business as well as its image. In order to
overcome of these issues, Google is making strong security and privacy system in their
organisation which allows the company for purpose protecting the data of the customers from
third-party access.
2 (b). Using Porter’s Five Forces Analysis, critically evaluate the strength and attractiveness of
the industry/sector that Google is currently operating in. What is the strength of the five
forces and what underlying factors drive them?
Porter’s five forces model:
It is one of the important frameworks to be used by the companies for purpose of evaluating of
attractiveness of the industry. It is a model which was introduced by the Michael Porter in the
year 1979. Google can used this model for purpose of consideration of the condition in to
different market and industry. Explanation of this model in context to the Google organisation is
mentioned below:
Competition in the industry: Google is facing strong competition in the marketplace as there
are number of competitors are there who are competing with the company. This competition
does not allow the firm to get the growth opportunities in the marketplace and also create a
negative impact over the profitability of the company (Tanrıverdi and Lezki, 2021. ). This
competition become a strong force as there are number of IT firms operating in the marketplace.
Diversity in the marketplace of the company is also high that create an issue for the business.
Therefore, there is a high threat of this factor for the business of Google.
Bargaining Power of buyers: There is low bargaining power in the marketplace which is
creating threat for the business of Google. It is one of the important factor that create a positive
impact for the business. There are small number of individual customers of the company that
does not provide them power to influence over the prices of the company. It is a company that
has higher demand in the market place which provides them an opportunity for getting growth.
Therefore, there is less threat faced by the company in context to the power of the customer to
influence the prices of company.
Bargaining Power of suppliers: Suppliers power of Google for purpose of influencing the
prices of products is also low. There are different reasons due to which this power of suppliers is
weak like there is high availability of supply in the marketplace (Ali and Anwar, 2021). There
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are a number of suppliers from which Google can take help or supplies in the marketplace.
Individual suppliers of Google are available in small to medium numbers. Therefore, the overall
threat of the power of suppliers for the company is also low.
The threat of substitute: There are the different substitute of google including advertising
channels like radio tv, print media, television and others. The switching cost for switching from
google to its substitute is high due to which customer does not switch easily. There is number of
substitutes available in the marketplace which create a threat for the business of Google. These
substitutes also provide cheaper ways for purpose of advertisement and other things. Therefore,
there is a moderate threat for Google in context to the substitute.
The threat of new entrants: In order to enter an industry in which google is operating and also
to compete with the Google, new entrants need to have sufficient resources (Memon and et. al.,
2021). It is difficult for the organization to compete with such a large organization. Therefore,
there is a moderate threat of this factor to the company.
From the above analysis of Porter’s model, it is understood that identifying the need and
desires of users is a very effective concept for organization. Without the proper understanding of
needs company did not able to run their services in smooth manner.
3 (a). Using Porter’s Generic Strategies framework, critically analyse Google’s corporate and
competitive strategies. To what extent do you think the competitive strategies are
sustainable over time?
It is one of the framework which helps business for purpose of gaining competitive advantage. It
is a framework that can be applied to a different industry. It is a model which was given by
Michael Porter in the year 1985 for purpose of attaining competitive advantage. Competitive
advantage can be described as ways in which a company is producing different types of goods
and services and also delivers it to its customers in a better manner in comparison to its
competitor. Google is using this tool in their organization which helps them to attain a
competitive advantage in the marketplace. It is important for the company for purpose of
differentiating its service from the competitors and also to get the opportunity to expand its
marketing share. This framework includes three different strategies which help businesses for
purpose of attaining a competitive advantage for the business. These strategies includes
differentiation, cost leadership as well as focused strategies. An explanation of some of these
strategies in the context of the company is mentioned below:
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Cost leadership: It is one of the important strategies which helps businesses for purpose of the
attaining a competitive advantage. It is a strategy that helps businesses for purpose of increasing
the sales of the company and also to compete with competitors in the marketplace. It can be
attained by the business of Google in two different manners including increasing profit of the
company with reducing the cost of the company but at the same time charging the average price
in the industry (Greckhamer and Gur, 2021). It is another strategy in which a business can gain a
competitive advantage by increasing the marketing share and also for charging the lower prices.
It provides a reasonable profit for the company for purpose of reducing the cost of the company.
For purpose of attaining a competitive advantage, Google needs to invest its capital in
technology which is important for purpose of reducing the cost of the company. The company
also needs to improve its logistics and also invest for purpose of attaining a lower base of
labours, materials as well as facilities.
Differentiation strategy: It is also a strategy for the business which is important for the
company for purpose of making their offering different from competitors and also making it
more attractive. It is a strategy that is dependent on the nature of the industry as well as products
and services. This differentiation can be based on durability, support, features and functionality.
For purpose of the success of this strategy in Google, the business needs to invest more in
research and development activities (Nalucha and Mwanza, 2022). It is also important for the
business needs to improve its ability for delivering products in higher quality. It is also important
for the business to improve the marketing and sales of the company by offering different benefits
which enable the organization to differentiate its service.
Focus Strategy: It is a strategy that can be adopted by the company in order to focus on a
specific niche market and also for purpose of understanding the dynamics of the market. It is also
essential for the business for Google in order to ensure the satisfaction of the needs of customers
and also for purpose of developing low-cost products in the marketplace. It is serving the needs
of customers in the marketplace in a unique manner.
On basis of the above discussion, it can be identified that Google needs to adopt a differentiation
strategy in their organisation. It is offering different products in all over the world.
Differentiation strategy provides guidance to the business of Google for developing unique
capabilities in the marketplace and also allows them for purpose of developing of
competitiveness of the company (Yaqoob and Omer, 2021). Google is developing its distinct
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image in the marketplace in order to maintain the uniqueness of its products and services. This
uniqueness is attained by the company by adopting innovation in their organization. Google is
offering the number of products and services to its competitors including the operating system,
mobile applications as well as desktops.
3 (b). With the aid of the Ansoff Matrix, assess the growth strategies adopted by Google? What
recommendations can you make to Google’s growth strategy for the future?
Ansoff Matrix is one of the growth strategies which is to be adopted by the business. It is a
framework that can be used by the business for purpose of helping the plan and also for purpose
of evaluating of different growth initiatives. It is one of the important strategies for the business
which provides assistance to the business in order to plan and also for taking different initiatives.
It is a tool that is developed by the company for purpose of conceptualization of risk associated
with the growth strategies. These strategies provide assistance to the business of Google for
purpose of evaluating of the attractiveness of the growth strategy of the business which are
dependent on the existing products and services. Explanation of these strategies in the context of
the Google is mentioned below:
Market Penetration: This strategy is based on the concept in which a business can increase the
sales of their organization by offering its existing products in the existing marketplace. Adoption
of this strategy is less risky for Google as it allows the business for the purpose of entering into
the existing market with its existing products (Mečionytė and Žilinskij, 2021). There is nothing
new in this strategy but the only change business adopt is that they are changing their ways to
target the market and also increase the market share by increasing the geographical boundaries of
the company. For purpose of adopting this strategy in Google, business needs to increase and
improve their marketing efforts as well as through streamlining their distribution processes.
Google can also decrease the prices of their offering which is also important for purpose of
business in order to attract a number of customers. Business can also acquire its competitors in
order to reduce the competition in the market.
Market development: It is a strategy that is focused on the selling of their existing products and
services in the new marketplace. Google can also use this strategy in the marketplace for purpose
of attaining growth in the marketplace. For instance, Google is using growth strategies by
offering cloud service for its business which is a new tool for the business. It allows businesses
for purpose of targeting customers in different areas at the global level. For the adoption of this
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strategy, business managers of Google can target to new customer segments. It is a business that
also helps them for purpose of entering into the new domestic market. Businesses can also adopt
this strategy business by entering into new segments as well as foreign markets.
Product development: It is another strategy in which the focus of business is on the
introduction of new products and services into the existing marketplace. It is also an important
strategy of the business google as it allows them for purpose of investing their funds in research
and development activities which helps them to develop new products and services (Kühn and
Morschett, 2022). There are some other ways in which Google can adopt this method for the
expansion of business like they can acquire the rights for purpose of production and selling of
products of a different firm. Google is adopting this strategy by introducing new mobile
applications like google classroom and others.
Diversification: It is the last strategy of this model in which the focus of business is on
introducing of new products in the new marketplace. It is one of the strategies which create high
risk as well as high opportunities in the marketplace. It is one of the important strategies for the
business of Google. There are two types of diversification strategies in the marketplace that can
be adopted by Google (Yuzhu, 2021). Related Diversification is a strategy that takes place in the
existing business and new products whereas unrelated diversification does not take place
between the existing business as well as the new products.
From above mentioned discussion, it can be analysed that Google can adopt product
development strategies. It is one of the important strategies for Google as in this, the business has
knowledge of existing markets but can introduce new products in the market for purpose of
attracting new products and services. It is one of strategy that provides a competitive advantage
for the business and also allows them to take advantage of different opportunities in the
marketplace. On basis of it, business can differentiate its service from others which is important
for them to attract a number of customers in the marketplace. It is also important for the business
for increasing sales as well as profitability of the company.
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