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CASE STUDY: Google Takes on the World
Evaluate Google using the competitive forces and value chain models.
1.1 Value Chain Analysis
The value chain is a systematic approach to examining the development of competitive advantage. The Googles chain consists of a series of activities that create and build value, the mission is to organize the worlds information and make it universally accessible and useful. Innovations in web search and advertising have made the web site a top internet destination and Google brand is one of the most recognized in the world.
1.2. Google Value Chain Model
I. Primary activities
Inbound Logistics
Search engine combined the PageRank system Brins web crawler.
Servers which use inexpensive off-the-shelf hardware
Operations
The technology was innovated, upgraded and extended. (Mapreduce, Google work queue, Google files systems, Ad Words (an auction-based advertising program that enables advertisers to deliver relevant ads targeted to search results or web content.), CPC, Google map, Google images, Google Apps, Google desktop search, Froogle, Google talk, Gmail, Google check out, Google video etc.), Google Audio Ads (an automated online media platform that schedules and places advertising into radio programs). Google Print Ads (a web-based marketplace for placing ads in print media), Google Video Ads (user-initiated click-to-play video ads that run on sites that are part of the Google Network).
It simplifies the storage and processing of large amounts of data, eases the deployment and operation of large-scale global products and services, and automates much of the administration of large-scale clusters of computers.
Most operations are read-only. When an update is required, queries are redirected to other servers, so as to simplify consistency issues. Queries are divided into sub-queries, where those sub-queries may be sent to different ducts in parallel, thus reducing the latency time. To lessen the effects of unavoidable hardware failure, data stored in the servers may be mirrored using hardware RAID. Software is also designed to be fault tolerant. Thus when a system goes down, data is still available on other servers, which increases the reliability.
Marketing and Sales
Marketing is reached 8 billion some say 25 billion of people. Google is Linux based program which is free. Low cost compare to other search engines. Most of revenues come from ads and search service.
Service
Search service which meets the expectations of the customers. Googles technology can evaluate millions of variables about its users and advertisers, correlate them with millions of potential ads and deliver the message to which each user most likely to respond
Outbound Logistics
Providing customer satisfaction and meets the needs of the customers. Making new software programs.
II. Support Activities
Procurement
Purchasing new hardware tools, servers at a lower cost.
Information Technology
Information Technology is the most important source of competitive advantage in case of Google.
Human Resource Management (HRM).
It is very important to hire the highly educated employees in IT and MIS fields. A companys culture helps it attract the best talent available in the industry. Google was one of the few companies that successfully blended technological innovation with strong organizational culture.
Firm Infrastructure
Infrastructure of the Google is closely guarded in secret, because it is one f the competitive advantages. The Google business relies on software and hardware infrastructure, which provides substantial computing resources at low cost. Their considerable investment in developing this infrastructure has produced several key benefits.
III. Googles analysis using competitive forces.
Competitors.
There are many competitors in the industry, but main competitors are Microsoft, Yahoo. The competitors are trying to thwart the Google, but Google is becoming powerful day by day.
Customers.
In the case of Google the customers have reached 8 billion but some say 25 billion. In the industry the customers is very strong link to help the business prosper. The Google already have 50% of the market which says that they have very strong competitive advantage.
New entrants.
In this case the new entrants cannot make the serious harm to the Goggle.
Suppliers.
The suppliers can be Linux, hardware tools suppliers.