Google shows another way to get back to the ABCs of innovation

Google's decision to set up a holding company to house its various innovative efforts is yet another take on the current trend by vendors to make life less complicated

When the technology history writers come to look back at this period of time one of the descriptions that might get used is that it was an era when the large behemoths in the IT world made moves to try and rediscover the benefits of being smaller and more flexible.

The goal is to establish a structure that fosters innovation, is focused on specific goals and rediscovers some of the magic that happen in the original garage or bedroom where the whole story started.

One option has been to split, with HP then Symantec choosing to go down that route to try and make life easier, as it pulls apart some of its portfolio to make it clearer what it is doing.

Some of the other players are trying to reinvent things without splits and spin-outs and Microsoft is a proponent of that strategy as it looks to focus on three divisions that cover all of its activities.

Things are unlikely to stop there with some of the other tech giants also looking at how they operate, with EMC recently coming under the spotlight with suggestions it could be swallowed by VMware.

Last night Google came up with another spin on trying to get into a situation where the business does not become too bloated.

The search engine giant announced it was setting up a holding company, Alphabet, which would be the home for several subsidiaries, including a slimmed down version of Google.

Vendors have often remarked that their ambition when it comes to working with the channel is to make life easier and simpler and some of these changes should have the benefit of doing that.

But as the Google move to set up Alphabet shows it is more about ensuring survival and trying to keep the spirit of innovation, that got them into a position of being market leaders, alive and well.

The firm revealed its plans to set up the new holding company in a blog post where its co-founder Larry Page expressed some fears that Google was turning into an established business.

“As Sergey [Brin, co-founder] and I wrote in the original founders letter 11 years ago, ‘Google is not a conventional company. We do not intend to become one’,” wrote Page.

“As part of that, we also said that you could expect us to make ‘smaller bets in areas that might seem very speculative or even strange when compared to our current businesses’. From the start, we’ve always strived to do more, and to do important and meaningful things with the resources we have," he added.

some of those activities have included its move into Google Glass as well as its expansion into the smart car market.

"We did a lot of things that seemed crazy at the time. Many of those crazy things now have over a billion users, like Google Maps, YouTube, Chrome, and Android. And we haven’t stopped there. We are still trying to do things other people think are crazy but we are super excited about," added Page.

One of the problems with Google, for both investors and resellers, has been trying to work out what is happening and which bits of the organisation they need to work with.

Establishing a slimmed down Google that focuses more on the search engine and apps business that has been sold via the channel should make life less complicated for partners.

The reasons for a new ABC

In his blog post explaining the rationale for the decision to set up Alphabet the Google co-founder Larry Page listed what he felt would be the benefits:

   Getting more ambitious things done
   Taking the long-term view
   Empowering great entrepreneurs and companies to flourish
   Investing at the scale of the opportunities and resources we see
   Improving the transparency and oversight of what we’re doing
   Making Google even better through greater focus
   And hopefully...as a result of all this, improving the lives of as many people as we can

For other vendors trying to rediscover the spirit of uncomplicated innovation the reasons that Page set out for setting up Alphabet will have a great deal of resonance (see box).

For many years the cliche 'get big, get niche or get out' drove a market that saw ever greater levels of consolidation and the creation of household names that wanted to try to do it all.

But with buyers showing an intelligence about choosing their IT beyond just the big brands the pressure is to now deliver not everything but the best solution.

The founding fathers were able to dream of big things as they sweated over solder irons and motherboards but now those dreams have come true for some the management and desire to find simplicity means they are more the stuff of nightmares.

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