In October 2015, in an unexpected move, global technology giant Google Inc (Google) restructured itself as Alphabet Inc (Alphabet), a new holding company under which Google’s non-core businesses, including self-driving cars, life sciences research, high-speed Internet access, and investment divisions, were spun off as distinct entities and separated from the company’s Internet operations such as Android, YouTube, and the Google search engine. The businesses were reorganized into two reporting segments: ‘Google’ and ‘Other Bets’. This marked a massive shift from the earlier setup in which Google was in charge of a number of diverse companies, some of which carried it far afield from its core search business. Under the new structure, a number of businesses including Google operated as subsidiaries of Alphabet and were run independently, each with its own CEO. According to a statement posted by Larry Page co-founder of Google, on the company’s official blog, “Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related. Alphabet is about businesses prospering through strong leaders and independence […]. This new structure will allow us to keep tremendous focus on the extraordinary opportunities we have inside of Google.”
The following points are to guide a review and discussion of some important concepts.
• Discuss Alphabet’s corporate governance and evaluate the effectiveness of Alphabet’s board of directors.
• Describe Alphabet’s corporate-level strategy and characterize its level of diversification. Discuss the advantages and disadvantages of the company’s organizational structure. Does the organizational design effectively support the needs of Alphabet’s corporate-level strategy?
• Identify Alphabet’s current challenges and describe Alphabet’s next move in terms of growth and expansion. Provide an analysis of what additional recommendations would be required to be done to help Alphabet achieve its goals.
3 page minimum
