Google provides the most widely used online search tool. Experian Hitwise reported that Google's market share in the US passed the 72% mark in Dec 2010. It has much higher market share's in many other countries. Google runs over one million servers in data centers around the world, and processes over one billion search requests. Though the search engine was the company's core product, it came up with multiple internet based products and services like (maps, docs, chrome, adwords, gmail etc etc....) which has made it a world leader in the technology industry. But how was it possible for Google to have this exponential growth?
Innovation culture:
One of the main reasons behind this success is because of the innovation culture at Google. At Google, engineers are allowed to work on the projects of their choice for 20% of their time. "The resulting '20 percent projects' will most often have nothing to do with Google's current core business.The innovation culture at Google is all about coming up with an idea, getting it out there for people to use as quick as possible, and having it evolve quickly through iterative process. The cultural response to a new idea is brainstorming. Why an idea can't be done and inner office politics is rarely an issue. Their culture is one that reduces friction between idea and implementation" as correctly identified by Eric Schnell. This is one of the main reasons for the success of Google. In fact, Google's newer services, such as Gmail, Google News, Orkut, and AdSense originated from these independent endeavors. Google stays at the top because it comes up with products that customers want. If I need a service online, the first thing I do is check if Google provides a tool I need. The same is true for millions of common people. This is the image that Google has created in the minds of everyone by its innovation culture.
Dependency:
Google makes money by advertising using Adwords and Adsense. It not only advertises on the google results page, but also allows users to place ads on their pages by using Adsense. By effectively placing ads across the Internet, it's making many billions in profit. "But there is a downside."
More and more companies are depending extensively on the products provided by Google. "A growing number of companies, especially smaller ones, are dependent for a stunning proportion of their sales - sometimes more than half - on referrals they get from Google ads. These companies could not effectively function without the promotional help they're getting from Google. That means on the one hand that Google is doing a great thing greasing the wheels of capitalism. But it also means that its responsibilities are becoming more burdensome." Advertisers are worried by the growth of Google and look at it as the next monopoly. If Google dominates the online market as now, many are worried that it would be able to control the prices of online advertising and rise it whenever it wants, wiping away profits for the advertisers. "There is already grumbling that Google's prices are rising too fast."
http://money.cnn.com/2007/10/12/magazines/fortune/fastforward_google.fortune/index.htm
So "Google may be too good for its own good." :) It needs competitors who can copy its successes.
Future:
Google is a company founded by geeks and run by geeks. "These are people who think they are creating something that's the best in the world," says Peter Norvig, a Google engineering director. "And that product is changing people's lives." It is interesting to know that most googlers are driven by "impossible perfection" and strive constantly to deliver what the customer wants.
http://www.fastcompany.com/magazine/69/google.html
It is company that has been successfully competing in several different sectors. Google will have to work on some of its potential problems, like dealing with internet censorship laws in China, dealing with tough competition in social media from Facebook and also, they should continue innovating to be on the top. But, "Google understands that its two most important assets are the attention and trust of its users." It tries to constantly improve itself and it also understands the capacity of the Web to leverage expertise. I believe Google's commitment to keep delivering and its innovation culture will keep it ahead of its competitors.
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