Patrick Reid

October 2023

Strategy Analysis and Practice

Corporate Strategy Workshop
 Dr Patrick Reid
• Twenty years international pharmaceuticals

• Fifteen years educational experience

• Current interests are in areas of innovation,

ecommunication

E-mail: patrick.m.reid@warwick.ac.uk
Cell: +44 (0)7713 069999
Skype name: patrickmreid

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Agenda

• Recap of Strategy

• Google Timeline and Approach

• The Case Questions

• Summary
 What Is Corporate Strategy?

Corporate strategy
Corporate strategy is a long-term plan adopted by an enterprise to facilitate a
company in creating value through the configuration and coordination of its multi-
market activities and thus to achieve its corporate strategic objective

Three key dimensions:

What industries (diversification)

What stages of industry value chain (vertical integration)

Where in the world to compete (geography)

What are the key decision criteria?

 Standard Strategy Types - Ansoff’s Strategy Matrix

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 Additional Strategy Type
Existing Products New Products

Existing
Market Penetration Product Development
Markets

Diversification
New
Market Development
Markets

Opportunism

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 What is “Opportunism”?
 Also Known as:
Entrepreneurial Opportunism
Unrelated Diversification
The strategy of having no strategy
 Unrelated diversification involves
entering an entirely new industry that lacks any important similarities with the firm’s existing
industry or industries
and is often accomplished through a merger or acquisition, example;
Virgin Group examines existing industries to see if the group can offer something better than existing
companies which may have become complacent – trains, insurance and banking for example
 However, the ‘unrelated diversification’ strategy is far from fool-proof and there are numerous
examples in which it has failed for Virgin
 Looking beyond the risk of failure, unrelated diversification creates further risks in terms of losing
brand strength, by blurring the delivery of a single strong message

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 About Alphabet
 Mission
“Our mission to organize the world’s information and make it universally accessible and
useful remains central to how we build our products”
○ 2022 Annual Report.

 What is Alphabet?
“Alphabet is a collection of companies that are pretty far afield of our main internet
products”, i.e. a diversified conglomerate
 Business Model
Alphabet’s corporate model is to have a strong CEO who runs each business, overseen by
corporate management
See Corporate Parenting – strong hands-on approach from top down – pros & cons?

 What is Alphabet’s Corporate Strategic Objective?

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 Alphabet’s Corporate Structure

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 Google Corporate Structure

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 Google – A Timeline

Ref: https://www.officetimeline.com/blog/google-history-timeline Accessed Date: 21st October 2022

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 Googles Strategy…

What is Google innovation strategy?

Among Google's nine principles of innovation are “ship and iterate”, produce
products very quickly, get them to market as a prototype if necessary and use
feedback from users to improve them; and “failing well”, eliminating products that
do not meet expectations but rather than being a stigma, instead generate pride.

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 Fast Fail

Ref: https://gcemetery.co/ Accessed Date: 21st October 2022

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 External Business Environment

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 Intensity of Competition - Porter’s Five Forces

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 Inherent Capabilities - SWOT of Google

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 Sustainable Competitive Advantage?

VRIO Model

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 Goodness-of-Fit?

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Questions
• What is Google's corporate strategy? Does Google have a clear
vision of what it wants to become?

• Evaluate Google's diversification into new products and

businesses, with particular reference to (a) browsers (Chrome),
(b) mobile phone operating systems (Android), (c) mobile
devices and (d) driverless cars. Why has Google diversified into
these areas? Are its reasons sound?

• Does Google need to refocus? How should Google delineate its

corporate boundaries, and which businesses or products would
you recommend abandoning or selling (if any)?

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 Google Case Questions – 1

 What is Google's corporate strategy?

To answer this question you need to
define the enterprise’s Corporate
Strategic Objective
 Capitalist => Maximise shareholder wealth
by;
 Increasing share price & increasing operating profits
 Philanthropic => Maximise the services
delivered with the capabilities available by;
 effective and efficient management & operation

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 Google Case Questions – 2

 Does Google have a clear “Vision” of what it wants to become?

To answer this question you need to decide on the natures of the long-term business futures for
the industries in which Google is involved
 Which are the key industries?

 What do their long-term futures look like?

 Scenario planning

 Are Google’s divisions a good fit for their possible alternative futures?

 What are your decision criteria?

 Which divisions to keep, which to dispose?

 See Q3 & Q4

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 Google Case Question – 3
 Evaluate Google's diversification into new products and businesses, with
particular reference to;
Browsers (Chrome)
Mobile phone operating systems (Android)
Mobile devices
Driverless cars
 What are the evaluation decision criteria – explain & justify these choices
 Why has Google diversified into these areas?
What is the business rationale – justification?
 Are its reasons sound?
What are its reasons?
What are the decision criteria?

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 Google Case Question - 4
 Does Google need to refocus?
Is Google’s current strategy going to be fit-for-purpose in the long-term future?
 Is Google’s strategy SAFR for the possible alternative futures?
o Suitable
o Acceptable
o Feasible
o Robust

 If not, what should its new focus and hence its new strategy be?
 How should Google delineate its corporate boundaries?
See the relationship between the degree of diversification and strategic success – the inverted U-Curve
 Which businesses or products would you recommend abandoning or selling (if
any)?
Consider dispersion theory & the product lifecycle concept

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 What is Google’s Strategy – One Pundit’s Opinion - 4 E’s

Note the date of this analysis,

Have things changed?

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Will it continue …

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Revenues

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 Summary

 Understand the difference between Alphabet & Google

Same CEOs but Google’s must support that of Alphabet

 What are the industries in which Google is involved?

Why is it involved in those industries?

 What are the characteristics of the possible alternative futures that Google might face?

 What are the current and future SWOT’s of Google?

Are Google’s capabilities a good fit to the possible future business environment(s)?

 Hence, what should Google’s future objective (focus) and strategy be and is it SAFR?

 Useful reference: Key Strategy Tools, Vaughan Evans

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