Google experienced rapid and strong growth with strong employee satisfaction. The
company worked to gain a globally diverse workforce with different perspectives in which
Information Technology Issues
Google was susceptible to threats from false or invalid visits to the ads it displayed, and has
had to refund fees charged for advertising due to fraudulent clicks. If Google failed to detect
click fraud or other invalid clicks, it could lose the confidence of its advertisers, which would
harm the company’s image and viability.
Additionally, interruption or failure of the information technology and communications
systems the company used could hurt its ability to effectively provide products and services,
damaging the reputation Google worked to maintain, as well as harming its operating income.
Its IT system was exposed to impairment from numerous sources, such as natural disasters,
infrastructure failures, and computer hackers. Although management had contingency plans
for many of these situations, such plans could not cover every possibility.
Index spammers could harm the integrity of Google’s web service by falsifying
users’ search attempts. This could damage the company’s reputation and lead to users becoming
unhappy with Google’s products and services, leading to a decline in website visits. This could
result in lower advertising revenues from its Google Network partners. Google relied greatly on
these members for a significant portion of its revenues, and both parties benefited from their association
with each other. The loss of these associates could adversely affect the business.
The future of the business depended upon continued and unimpeded access to the Internet
for both the company and its users. Internet access providers may be able to block, degrade,
or charge for access to certain Google products and services, which could lead to additional
expenses and the loss of users and advertisers.
As Google spread its operations across the globe, more and more of its receivables were
being denominated in foreign currencies. If currency exchange rates become unfavorable, the
company could lose some revenues in U.S. dollar terms. Although many multinational corporations
used hedging strategies to lower or negate the risk of doing business overseas, Google
had limited experience with many of these financial strategies. Hedging strategies also had
high costs, reducing the company’s overall profitability.
Alternative Technology
Each day, more individuals were using devices other than personal computers to access the Internet.
If users of these devices did not widely adopt versions of Google’s web search technology, products,
or operating systems developed for these devices, the business could be adversely affected. These alternative
devices may make it problematic to use the services provided by Google, and make it challenging
for the company to produce products which capture customers’ imaginations and loyalties.
CASE 12 Google Inc. (2010): The Future of the Internet Search Engine 12-13
Seasonality
While there were some seasonal effects on Google’s business, it was generally not as significant
as in retail stores, which earned much of their revenue in the last quarter of the calendar year.
In Google’s case, there had generally been an increase in business in the last quarter of the
calendar year, as represented by commercial queries. Likewise, the summer months tended
to be the slowest time of the year. While seasonality might be an issue for Google’s business
and revenue, it was generally not perceived by management to be a major issue.
employees were rewarded for performance.