Group2

Organizationalanalysis

08102014

Google Inc.

by
AlexisLabrosse,AlinaCiobanu,AronMarossy,CristianAlexandruOnu,EmilLauritsen,MichaelJensen&
MihailMilkov.

Introduction
Companyevolution
Subcompanies
Levelsofmanagement
Googlesstructuralconfigurations
Conclusion
References

Introduction
Thesubjectoforganizationaldesignhasbeenhighlyaddressedrecently,inthepursuitof
structuringworkandpeopletoincreaseefficiencyandoutputs(1),resultingintoalargeand
variedliterature.
Mintzbergistryingtoaddressthisbroadliteratureandresearchonorganizationaldesign,
summingupalltheimportantaspectsandorganizingthemin5s:fivebasicpartsor
elementsofanorganization,fivecoordinatingmechanismsorwaysoffunctioningandfive
configurationsortypesofstructuring.
Thispaperisgivingabriefanalysisupononeoftodaysmostwidespread,yetinnovative
companysstructureGoogle,usingMintzbergstheoryinhisStructuresin5article.Westart
bypresentingthecompanysevolutionfromitsfounding,movingtowardsdescribingthe
organizationalstructureinpresent.
EmphasisisputondescribingandarguingwhyGoogleInc.canbeseenasbelongingtoone
ormoreoftheconfigurationsdescribedinStructurein5sarticle.

Company evolution

WhentalkingaboutGoogle,itisimportanttolookintotheevolutionofthecompanystarting
fromitsearlydayswhenitwasfoundedbytwoPhDstudentsatStanfordUniversityasa
simplesearchengine.Throughouttheyears,duetotherapidgrowthofthecompany,it
evolvedfrombeingonlyasearchengine,tooneofthemostinfluentialcompaniesinthe
world.Atthemoment,GoogleInc.consistsofdifferentcompaniesaroundtheworld.
Alongwiththeacquisitionofothercompanies,theorganisationalstructureofGoogleInc.was
modifiedtoaccommodatetheconstantexpansion.
1

Group2

Organizationalanalysis

08102014

Sub-companies
Googleisacompanyconsistingofmanyothersubcompanieswhichwereeitherboughtor
foundedbythemselves.Becauseofthis,thearchitectureofGoogleisnothomogeneous,
sincesomeofthesesubcompanieskepttheiroriginalstructure.Examplesofimportantand
wellknowncompaniesthatarepartofGoogleinclude.

Motorola(BoughtbyGooglein2011for$12,500,000,000)
Purchased in order to enter the smartphone market. This company implements
ProfessionalBureaucracy.
YouTube(BoughtbyGooglein2006for$1,650,000,000)
Video on demand service, Google bought it because they saw interest in it as a
medium for advertisements. Used to be flat before bought by Google, but fully
implementedtheGooglemodelafterpurchase.
Android(BoughtbyGooglein2005for$50,000,000)
This company develops the Android OS, which is also owned by Google. Has the
same structure as Google, but with a bit more supervision due to thesensitivenature
ofdevelopinganOS.
Waze(BoughtbyGooglein2013for$966,000,000)
Google bought thiscompany making navigation company todevelop Google Maps. It
isasmallcompany,usingAdministrativeAdhocracyastheircompanystructure.
Doubleclick(BoughtbyGooglein2007for$3,100,000,000)
This company is responsible for the handling of advertisements through the AdSense
system.UsesthesamehierarchyasGoogle.

Group2

Organizationalanalysis

08102014

Levels of management
ThiscategorizationofGooglescompanyhierarchyisbroadlydoneon3levelsthefirstone
inholdalltheadministrativelevelprofessionalswhilemiddleoneinholdexecutivelevel
officialsandattheendareoperationalprofessionals.ThethreelevelsinGooglecompany
hierarchyareexplainedbrieflybelowinchronologicalorderthehighestoneinthehierarchy
isplacedatthetopwhilethelowestoneisplacedattheend.

Theadministrativelevel:TheprofessionalsatthishighestlevelofGooglecompany
hierarchytakecareoftheentireadministrativeworkforthecorporation.Professionalsto
enjoysuchhighleveljobprofileinGooglearerequiredtobeequippedwithextensive
experienceandknowledgeoftheirfield.
Theexecutivelevel:TheprofessionalatthismiddlelevelofGooglecompanyhierarchy
undertakealltheexecutiveleveldutiesforthefirm.Majorityofthemareteamleadersoftheir
specificdepartmentsandhandletheentireteamofprofessionalsunderthem.
Theoperationallevel:Theseprofessionalsmanagesomedefinite&prespecifiedareain
companyaspertheirexpertise.
3

Group2

Organizationalanalysis

08102014

Googles structural configurations

OneofthethingsMintzbergacknowledgesintheconclusionofhisstudyisthatthereisno
purecompanytype,meaningthatanyorganizationwouldnotfitinonlyofthefivetypes
describedbutinheritfromdifferentorganizationalstructureswhereoneismostdominant.
ItisimpossibletoputGoogleinonecategoryasitfitsmultipleprofiles.

Themostobviousoneistheadhocracyconfiguration.Onekeycharacteristicforthismodel
isdecentralisation.AccordingtoLisaJackson,Googlesnumberoneculturesuccesssecretis
trust(10).InhisbookWhatWouldGoogleDo?,JeffJarviswritesthatthereisaninverse
relationshipbetweencontrolandtrust.TrustisatwowayexchangeandGoogleseemsto
havethisverywellintegratedintheirorganizationalculture.Animportantprinciplereflecting
thisisthe702010rule,amanagerialguidelineintroducedbyGoogle.
The702010ruleallowemployeestouse70%oftheirtimetodotaskstheirareresponsible
toworkwith,20%oftheirtimeonprojectsrelatedtotheirproject,andthelast10%on
projectsoftheirinterestinanyarea.Thishasinreturnturnedouttobeagreatinvestment,
sincealotofGooglesnewinitiativesareaproductofthismodel,tomentionafew:Google
Earth,GoogleMaps,GoogleNewsetc.

Thedecentralizationofacompanycanbeusedtovisualizetheinternalstructureofthe
company.Googleconsistsofalotofsmallercompanies,whichallareconnectedinsome
way,buttheyarenotdirectlycontrolledfromasingleupperfractionofthecompany.Rather,
theyarebeingledbyacrossfunctionaldirectionwithalotofflexibilityandfreedom.Thisis
theexactoppositecontrolofmostbiggercompanies,whichtendtobelinearandsomewhat,if
notallbureaucratic.(2)
ThereasonbehindGooglesmanagementsystemistheirmotto:Dontbeevil.Althougha
companyhastohaveanupperdirection,whichisaboveeveryoneelse,thegoalhasalways
beennottointerfereallthatmuchwiththeindividualorganizations.Googlewouldrathertrust
theirsmallermanagementsections,thanresorttoacentralizedsystemofcommand.

AnorganizationalstructureasbigasGoogle,whichevolvedsorapidly,requiresalotof
managingstructures.
Afterafailedattemptattotallywipingawaytheirmanagingstructurein2002,Googleemploys
37000peoplein2013,including5000managers,1000directorsand100vicepresidents.(3)
Havingthisamountofmanagement,doesnotreallyfittheadhocracymodel,beingmore
characteristicofaDivisionalizedFormoraProfessionalBureaucracy,butisanecessityin
caseofacompanythatisasdiversifiedasGoogle.

Largeorganizationswithdiversifiedproductscreatedivisionstohandlerelatedactivities.The
advantageofthisdivisionalizedorganizationalstructureisthatthedivisionscanactwitha
highdegreeofautonomytoaddresstheirparticularsituations,whilethecentralpartofthe
organizationconcentratesonthebigpicture.
4

Group2

Organizationalanalysis

08102014

Googlealsoadoptedthisprinciplewiththeirworkindiversifiedfieldsandprojects,suchasin
GoogleCars,HomeAutomation,GoogleFiber,Robotics,QuantumComputingetc.

Asmanynewtechcompanies,theadhocracymodelismoreattractiveforyoungerpeople.As
describedbyMintzbergAdhocracyisinVoguewithemphasisesonorganicandmatrix
structures,teamandtasksforces,sophisticatedandcomplexsystems,youth,complexand
dynamicenvironments.ThecompanyisfamousofitsGoogleCulture,whichfavorsaless
formalizedbehaviour.ItisnormaltorideSegwaysandelectricalbikestonavigatebetween
officesandtheGoogleplexanddiscussprojectsatthecoffeeplaceandtalkdirectlywiththe
managersofGoogle,evenifyouareanintern.
WhenlookingatMaslowshierarchyofneeds,itiseasytounderstandwhyGoogleisthemost
desiredcompanytoworkfor(4),andtheyhave2millionapplicationsfor500jobs.(5)

Conclusion

Asdescribedinthisassignment,Googleusesadecentralisedarchitectureinordertokeep
themoraleofitsemployeeshighandremainattractiveonthejobmarket,butbecauseGoogle
ownsmanysubcompaniesandtheydonothaveahomogeneousstructure.Thesuccessof
thisstructuralorganizationresidesinitsintricatemixofAdhocracyandDivisionalizedForm.
Googlemaintainsanorganicandhumanisticstructureandatthesametime,theyareableto
takeimportantandstrategicmarketingdecisions,allcreatingthesuccessfulandattractive
companyknownasGoogle.

Group2

Organizationalanalysis

08102014

References
(1)OrganizationalStructure:LookingThroughaStrategyLens,BarbaraKeatsandHughM.
ONeill
http://www.blackwellreference.com/subscriber/uid=809/tocnode?id=g9780631218616_chunk_
g978063121861622

(2)GooglehiringpolicyiskeytoitssuccessasbestplacetoworkinUK,Personneltoday
http://www.personneltoday.com/hr/googlehiringpolicyiskeytoitssuccessasbestplaceto
workinuk/

(3)DoesGoogleneedmanagers?DrakeBaer
http://www.fastcompany.com/3022131/leadershipnow/doesgoogleneedmanagers

(4)100BestCompaniesToWorkForFortune
http://archive.fortune.com/magazines/fortune/bestcompanies/index.html

(5)TheRealSecretBehindGooglesCorporateCultureCorporateculturepros
http://www.corporateculturepros.com/2013/07/therealsecretofgooglescorporateculture/

(6)GooglesOrganizationalStructureEhow
http://www.ehow.com/about_6692920_google_sorganizationalstructure.html

(7)GoogleTheCompany
https://www.google.com/about/company/

(8)"Google'sBusinessLeadershipandOrganizationalCulture"Chron.
http://smallbusiness.chron.com/googlesbusinessleadershiporganizationalculture58108.ht
ml

(9)"GoogleCompanyHierarchy"HierarchyStructure.
http://www.hierarchystructure.com/googlecompanyhierarchy/

(10)"Business."Google'sOrganizationalStructureandCultureGreatlyFosterInnovationand
Creativity
http://www.ukessays.com/essays/business/googlesorganizationalstructureandculturegreat
lyfosterinnovationandcreativitybusinessessay.php