Google disrupts the tech industry life cycle

Google is renowned for disrupting established standards. In the book Googled,  Ken Auletta discusses several times where Google’s engineering approach disrupted previously long-established business models. I wonder whether Google isn’t doing it again in another area.

A few years ago, an MIT Sloan Review article ‘Shifting Cultural Gears in Technology-Driven Industries‘ asserted that:

In technology-driven industries, as core technologies mature and mainstream customers proliferate, the primary source of customer value inevitably shifts from product innovation to business innovation, which focuses on processes (product development, procurement, manufacturing, sales, distribution or services) and marketing (partnering, segmenting, positioning, packaging or branding). To meet the changing needs of customers, technology-driven companies must effect a corresponding shift in their own competencies. However, attempts to accomplish that through changes in strategy, structure, processes or rewards without changing the company’s underlying cultural assumptions are almost always doomed to failure because culture strongly shapes both the competencies and rigidities of a company.

Then along comes Larry Page, reinstalled as CEO of Google, and starts changing his company is a way that seems to do the opposite of the MIT article.

The main theme that seems to be emerging: An elimination of Google’s more centralized functional structure–where Rosenberg was one of several manager kingpins–to one in which the individual business units and their engineers, such as its most independent Android division, rule more autonomously.

Reimagined like this, Google would become an ambidextrous organization with more powerful unit line execs, mostly engineers, doing what needs to be done to succeed

So is Google moving in the opposite direction to that suggested in the MIT Sloan article?


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