Lego

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Strategic Direction (Part 1)

Published May 5, 2014 by Mayrbear's Lair

strategy

This week the focus of my research work takes a look at the different methods successful organizations implement to manage a firm’s strategic direction. To illustrate this concept, I have chosen a Fortune 500 company and will identify the corporation’s strategic direction, as well as provide recommendations for changes that could be valuable in future endeavors. The organization I chose to focus on was Google. The reason I chose this firm is because I use many of their products and wanted to learn more about this company I have been supporting. Plus, I was fascinated to find out more about the business strategies they incorporate which have allowed them to achieve meteoric levels of success.

google

Google was founded in 1998 and currently serves billions of consumers around the world. The firm provides a variety of services for individual people as well as for businesses. Larry Page, the organization’s co-founder and CEO, reveals that Google’s initial strategic direction was to provide the perfect search engine that understands exactly what the consumer needs and provide them exactly what they want (Google, 2013). Since that time, however, the firm has incorporated expansion tactics in the strategic direction process that has helped them grow by including other products and services that go beyond that of their search engine capabilities.

google (1)

Their expansion strategies, for example, have guided the firm to include the addition of technologies such as Gmail, Google Docs, Google Drive, and the internet browser Chrome. In addition, the firm has branched out and developed partnerships with other corporations like LEGO to create a collaboration that allows users access to 3D technology so they can develop and publish their own creations (Chrome + LEGO: You can build whatever you like, 2014).

google-lego-logo

As if that weren’t enough, the firm also expanded their efforts into the mobile phone industry. For example, in 2012, Google purchased Motorola to help promote their smartphone brand Android. However, because of the high level of competition in the smartphone industry, the firm recently adjusted their strategic direction by selling Motorola to Lenovo for $2.91 billion dollars.

GooMoto

The strategy behind this move was to provide better services to consumers. For instance, Google strategists believe that Lenovo has the ability and expertise to restore Motorola as the major industry player it once was using the Android ecosystem as a means to achieve this. This strategic decision was based on Lenovo’s impressive experience with hardware as well as their impressive level of global reach.

from-google-to-lenovo

Lenovo, in the meantime, will keep Motorola’s brand identity, while Google retains the vast majority of Motorola’s patents which they intend to use to support the Android system (Lenovo to acquire Motorola Mobility, 2014). In short, to expand the firm’s abilities and capabilities, Google’s partnering with LEGO, in addition to the sale of Motorola to Lenovo, were corporate strategic moves that were designed to move the organization forward by utilizing a horizontal integration growth strategy. In other words, rather than go up against their competitors, Google implemented a strategic direction that combined their operations with that of their competitors. This brilliant move served to help them both meet their goals and establish a competitive edge in the market place.

Wednesday’s post will take a closer look at other strategic moves that helped Google navigate their path as a leader in the global arena.

Until then … let’s continue to work on getting organized!

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“Truth is by nature self-evident. As soon as you remove the cobwebs of ignorance that surround it, it shines clear.” — Mahatma Gandhi

 

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References:

Chrome + LEGO: You can build whatever you like. (2014, January 28). Retrieved February 2, 2014, from googleblog.blogspot.com: http://googleblog.blogspot.com/2014/01/chrome-lego-you-can-build-whatever-you.html

Google. (2013). Retrieved February 1, 2014, from Google.com: http://www.google.com/about/company

Lenovo to acquire Motorola Mobility. (2014, January 29). Retrieved February 2, 2014, from googleblog.blogspot.com: http://googleblog.blogspot.com/2014/01/lenovo-to-acquire-motorola-mobility.html

 

The Entrepreneurial Culture

Published February 27, 2013 by Mayrbear's Lair

oc-Entrepreneurship

Research reveals that more and more companies are embracing an entrepreneurial culture in the innovation process within their organizations. Firms have begun to comprehend that the nature of innovation is transforming the workplace and have developed policies to accommodate this paradigm shift.  The field of innovation now expands beyond the traditional arenas of science and technology.  Organizations have done this by instigating innovation in ways that also address new components to include: 1) co-creation, 2) user involvement, and 3) environmental and social challenges (Prahalad, 2010). The Lego Corporation, for example has emerged as a company that incorporates a visible entrepreneurial culture.

lego-mindstorm-nxt

In 2006, innovators at Lego decided to involve users in the early stages of the development process for the next generation of a popular product called Mindstorms.  They picked four advanced users from an online community to help develop new features. This strategic union between users and non-users from the in-house production staff turned out to be quite successful and a contribution to Lego’s culture toward a better organizational experience. The experience and insight users offered were a valuable asset for the engineers who could now develop a new product directly with the feedback of the operators. It was so successful, they eventually became a part of the Lego Innovation team and the new version of Mindstorms NXT went on to garner two achievement awards within the first few months of its release. MacDonald (2008) purports that working for a huge corporation can hinder productivity due to the bureaucratic nature.  In other words there is less freedom to engage in creativity that can help individuals fully realize their potential (MacDonald, 2008, pp. 4-6). The Lego corporation has found a way to break some of these bureaucratic barriers by incorporating innovative entrepreneurial techniques.

economic-crisis

Economic crisis and high unemployment rates forced some out of the world of bureaumania and into the world of entrepreneurship. It forced some individuals to find solutions outside the box for employment. For example, one person began offering marketing and social media production services to a select corporate executives as an independent contractor.  The venture is still in the infancy stages as they continue to learn from their experiences and work out the bugs from the structures that hinder the process which include the expansion of a client base and the resources to support it. Badal (2013) suggests that creating the right environment which includes: (a) being open to risk, (b) developing trusting relationships, (c) building skills and knowledge, (d) offering support, (e) obtaining access to resources, (f) maintaining a supportive organizational structure, and (g) setting realistic goals, is pivotal for the innovation process that is emerging in the entrepreneurial sector (Badal, 2013).

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References:

Badal, S. (2013). Building corporate entrepreneurship is hard work. Retrieved February 13, 2013, from Gallup Business Journal: http://businessjournal.gallup.com/content/157604/building-corporate-entrepreneurship-hard-work.aspx

MacDonald, R. (2008). Beat the system: 11 secrets to building an entrepreneurial culture in a bureaucratic world. Hoboken, NJ: John Wiley & Sons, Inc.

Prahalad, C. K. (2010). The new nature of innovation. Ann Arbor, MI: OECD.