Googles Competitive Strategies - Case Study Example

In recent years, competition has been a major challenge in the business environment. This reason has therefore influenced the need for strategically managing organizational resources, processes and performance. Competition negative impacts can be reduced through critically managing various elements which include management skills, human resources and finally the most important factor will involve innovative technology. Chandler (2004) describes that this continuous process of managing and formulating business decisions improves a company’s competitive strength thus it is able to position itself better in the market. The above study shows the aggressive competition between companies providing wireless devices which include Google, Microsoft etc. Goggle and Microsoft have been faced with various kinds of strategic issues and these have resulted to acquisitions and merging with other internet providers in order to have a competitive position. Recently, Google has announced that it is about to introduce another operating system that will aim at competing with their rival Windows. Microsoft on the other hand has introduced another system involving Office 10 which will offer its users free online services and especially to the office applications (Lei-da and Ravi 2004). Microsoft has also introduced another search engine known as Bing that will aim at increasing its market share and thus beating its competitors in this case Goggle. This battle between the wireless providers is to continue for a long time as each company always avoids the other from dominating the market. Ryan (2009) describes that the fight is meant to show which of the two companies is to lead technological innovations. The two companies operate on different strategic management and use different theories in management this makes it a reason why they both survive pressures in the economic environment. According to Siau and Shen (2003) in 2008 for example Google managed to generate more than $22 billion in revenue, among this, 97 percent of revenue was from commercials which are purchased by the keyword then located near search results. They can also be placed on pages around the web. Much of the revenue made by Google is from collecting its online applications for mother companies whereby the charges are not less than $50 for every person per year. This method tends to give away their online text editor, their emails and other programs such as spreadsheet programs (Sabat 2002). Comparing this with Microsoft where they made around $14.3 billion in only the Microsoft Word and PowerPoint which are mostly used in various kinds of business applications and these records are for the last eight months. The company made a profit of about $9 billion including more from sales which added up to $15 billion. Stuart (2003, p. 165) describes that these were records for the year 2008 where the amount of sales of the operating systems for instance XP installations, Vista and the Windows Mobile were included in the server software. One strategy that Goggle is using to beat competitors in the near future will include introducing various products of operating systems for example Android, smartphones OS, a Chrome OS used in Goggle chrome and a browser which will consist of an open-source OS that will be in a position of being used on notebooks and desktops applications. Most of these strategic managers have always tried to copy the other company’s strategies in order to beat their competition that is the reason why these firms have been producing similar products. The rivalry between the two companies is so much in the sense that one company can sacrifice so much to make the other lose in productivity and outcomes. One situation is where Microsoft Company held a behind-the-scenes campaign aimed at ruining a strategy that Google had introduced where it had linked with Yahoo for a deal in conducting promotions. Microsoft has also previously attempted to disrupt the arrangement which had been introduced by the Google Book Search. The reality of all these competing situations is downed on the fact that both companies want to be recognized by their users as the best in technology provisions and at the same time would like to create ecosystems that will please their consumers who will always want to be associated with them. The aggressive competition can also be influenced by every company’s ego of wanting to be the king of technological applications. In the near future Microsoft aim is to influence every customer to use its Internet Explorer browser in case they want to search via Bing or in situations where one has to search from Microsoft’s MSN entry in case of emailing a friend one can either use Hotmail or Outlook. The company would have also introduced the Windows Mobile in a smartphone to enable the users to easily access their mails or to chat with friends and will then be their competitive advantage. An Xbox is also important as it is used at home by children thus making them enjoy the services of Microsoft. This gives is the evidence where studies show that Microsoft is the most applied software developer due to its various kinds of services in terms of business applications, providing online games and helping in editing of photos. This has made the Company gain core competence against its competitors. Google’s competitive strategies The company has been trying out in beating its competitor Microsoft for it to gain market share in the market. One of the strategies used to achieve this was the introduction of Google Chrome browser which consists of default homepage that offers Google News. The page also displays internet options such as Gmail which then displays a Word document in form of an attachment that is later opened through online word processor. The other strategy that Google has been using in beating the competitive market include offering free Google served advertisements as well as cookies used for tracking. This free technology has really earned the Company a bigger market share as more people will be interested in searching the web. Advertisers can be accessed through contribution of some premium and provision of some profile. The two competing firms are linked with four major parts in their competition. One of these includes browsers this is where the Internet Explorer that is mostly applied in this kind of variations has maintained at 75 percent of the total market in all the type of studies carried out. This kind of market dominance has significantly remained that though recently Microsoft has offered around IE8 lags where it also leads in the market in both features and sophisticated web competences in reference to their browsers. Some of the most used browsers that have also improved technological innovations include Firefox, Opera, and Apple's Safari. These have been in use for the last five years though there are people who are so convinced that IE is still the best in technology despite the above innovations which are much safer to use and more advanced than IE which features a default home page (McCormick 2007). The Google's Chrome browser has been knows as a minor of all the browsers. It has also been known as a quick browser and it tends to transform handling of tabs. The Google also consists of an address bar or the search box where in this case a website that is to be opened has to use a different kind of where it can also find it difficult in reading and writing files. In this applications if one website crashes then the others will continue operating through the use of sandboxing. The applications are also important as they make it difficult to be accessed by internet hackers who tamper with other people’s data and files. According to studies shown, Google chrome’s market share is almost 2 percent as many people are not ready to tryout its benefits. In reference to the Google’s online search, most users have opted using the browser due to its search engine that brings much revenue to the Company for example in 2008, the search engine distributed almost 79 percent in terms of pages from search results which had been asked by U.S customers. This resulted to revenue increase in the earlier months of 2009 and the revenue level amounted to $5 billion. Most of this was mostly seen through the use of Ad Words which is an auction-based service used to support web based advertisements as well as positioning of major words used while asking Google questions. The introduction of Bing by Microsoft according to their strategic managers was to beat the Google’s competition. This search engine is still new in the technological world and the Company hopes that it will earn them a bigger position in the market. Hemant (2005) shows the search engine has been formulated in a way that it is able to offer some innovative feature and this strategy reflects that the company has critically planned on the better methods of offering their customers with better methods of communications. This is because by using this strategy more customers will prefer using the new search engine which is able to synthesize data and not just by recover links as it had been the case before. Though the Bing has modernized technologies since its introduction, it has only managed to gain about 8 percent of searches conducted in the web. The major cause of these drawbacks includes the fact that many media houses have been covering a misleading campaign thus making many users view the search engine as not important. According to Drucker (2004) the other kind of competitive feature used by both companies includes the Operating Systems. For a long time now, Microsoft has been modernizing its operating system as it has been in existence for almost 30 years. Studies show that the Company’s operating systems have been used by 90 percent of people using laptops and desktops (Sultan and Rohm 2004).  The company however has been trying to copy others strategies for example features such as introduction of search engines and it has also tried to control the competitors legal matters where it plans to remove its competitors completely from the market. One strategy that the company has succeeded to lead in the market is the use of OS which was introduced more than 30 years ago. This has gained the company more revenue though other companies are influencing competitions for example Apple and Digital Research. The Company has also introduced another new product which is Windows 7 which is faster and easier to use than what had been used earlier such as Vista and Windows XP. This shows how the company has increased its market share as studies show that most companies out there use Microsoft Office. The company has also planned on launching another version of its operating system. This is because the OS has many advantages and that is why it is preferred by most users. The features which are mostly enjoyed by these users include Windows, games and other applications found in Windows. It is also an advantage to those seeking employments as it is easy to learn and understand (Chaffee 2005). On the other hand Google introduced its OS in 2007 when the Android was introduced but could only work on small devices such as phones. The company now is targeting to involve more than twenty models of phones to contain the Android operating system which will also pull some people who uses Windows from its competitor. To achieve this target, Google has strategized on dubbing its chrome for better results (Chen and Nath 2004, p. 47). The other strategy that the company aims at will involve developing its software in a manner that it will operate within the browser and not as it had been operating through the OS. The company has also decided to expand on their website powers whereby these websites will be dependent on their browser for assistance for example in case of storage facilities or data processing. This method will help the system work effectively thus please the users who will continue purchasing the device (Burke 2002, p. 244). In promotion strategies, Google has greatly benefited from its modernized auction-based text ads. According to Ansoff (2005) in 2007 for example the company had made more than 2.5 billion dollars through the process of ad serving. The program is still being run in other devices such as mobile phones, print media and television advertisements. Microsoft has however not been gaining on advertisements and has been losing on revenue for example in 2009 where more than I billion was lost. Conclusion This competition from the two companies has brought about much benefit to the consumer as competition becomes aggressive the more the company improves on technology and lowers its costs. The companies have introduced new strategies for example Google in their promotions and operating system that will act as their competitive advantage in the near future. Microsoft also has a competitive advantage after the introduction of Windows 7 which is preferred by many users due to its benefits. References Ansoff, I 2005, Corporate strategy, McGraw Hill, New York. Burke, R 2002, Technology and customer interface, Journal of the Academy of Marketing Science, p. 244. Chaffee, E 2005, Three models of strategy, Academy of Management Review, vol. 10, no. 1. 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Stuart, J 2003, Under the skin, Short-range embedded wireless technology, International Journal of Information Management, vol. 22, no. 3, pp. 165-179, Wellington, New Zealand. Sultan, F & Rohm, M 2004, The evolving role of the internet in the market strategy, Journal of Interactive marketing. Read More