1. Using the Ashridge Sense of Mission Model, analyse and interpret Google’s sense of mission taking its recent corporate diversification and strategic leadership into account.
2. Critically discuss Google’s approach to strategic decision-making and evaluate the resemblance and transferability, if any, to Grant’s (2003) findings on planned emergence in major oil companies. Leader-member exchange (LMX) theory suggests that supervisors have relatively high-quality exchange relationships with some employees and relatively low-quality relationships with others. Critically examine the usefulness of leader-member exchange theory in explaining productive leader-follower relationships. Provide practical examples of leader-follower relationships and the outcomes they generate.
To understand the given proposition it is imperative to explain the nuances of Ashridge Mission Model and its implications. Ashridge Model Statement is a mission report statement as propounded by Ashridge Strategic Management Center. The four components include purpose, values, strategies, and behavioral standards. There is a startling resemblance of Google’s sense of mission with Ashridge theory. The components of the theory are intended to explain the organizational culture of Google. Managers and the resources are occasionally searching for a sense of identity and purpose. The employees desire more than safety, pay and opportunity to develop their skills and competence (Herman et al. 2013). They want a sense of mission more than anything else. There are number of functions that a Mission may have in any organization. The external and internal functions include various aspects. The sense of mission entails to motivate and inspire managers and resources to higher level of performance. Also it delves in performing of resource allocation in a consistent manner. Here, providing a sense of directions along with promotion of shared values amongst the resources. However, the entire motive boils down to improvement of corporate performance. A mission statement is an articulation of an organization’s mission (Stiegler and Gaba 2015). The definition of mission statement means a largely defined and enduring statement of purpose that distinguishes the firm from the rest and identifies the scope of its operations in product and in terms of market. The Ashridge Model speaks about creation or utilization of a purpose or mission, sense of mission and mission statement, by and large. Companies willing to integrate this model or theory would help them to fulfill the shareholders and stakeholders’ needs and benefits. It also helps them to think clearly about the mission along with developing of new Mission and clarification of an existing mission. However, a corporate mission should not be confused with that of corporate vision. The ideology combines cultural and strategic motivators to guide an organization. The model is mainly useful for ensuring that the firm has a clear mission and the resources with a sense of mission (Holland and Nichele 2016).
Ashridge Mission Model has its presence in Google. The mission statement of the firm in question is to organize the world’s information and strive to make it accessible and useful. In other words, Google is working hard to create new services and solutions for future. The firm has assumed to be one of the most powerful tools that take into account wide range of applications that are being processed in daily activities (Islam et al. 2013). Earlier, it had expanded the business by purchasing YouTube that were immensely popular in those days. In recent times, the company launched a new mobile phone named, Nexus One which is slated to compete with Apple iPhone. Furthermore, the firm is also developing an online operating system that may supersede Microsoft’s windows OS (Aguilera et al. 2016). For diversification of services and solutions, the firm had invested nearly USD 39 million in two entities which may be deemed green initiative. This step is recognized as corporate social responsibility of the organization. The pace of progression of Google is remarkable since its inception and the firm ranks third in esteemed business journals within a short span of merely thirteen years. Google was so far confined in various dimensions of technological advancement (Hu and Liden 2013). The firm has taken the route of diversification to ensure that it does not suffer if one of the wings faces a descending slope. The entity was surfaced as a search engine which was extended in the realms of social networking and host of online services and solutions that are enjoyed by countless internet users. Now the firm deals with mobile division, desktop applications and also Operating System. Artificial intelligence is something that the firm is planning to launch (Thomas et al. 2013).
The working environment of the firm may be related to Ashridge Sense of Mission Model. The firm encourages new ideas and nurtures them with sincerity. Google makes sure that the resources are paid in best possible standards with their skills, endeavor and competence. The firm has its units all across the globe which provides ample opportunities for jobseekers to work with the firm (Hubbard et al. 2014). The organization boasts of complete work culture which is supportive and friendly to say the least. It goes without saying that the firm is a huge profit earner wherein innovation is the driving force. The organization provides huge motivation to its resources at workplace which enables them to work in full potential. Google being the innovative and dynamic entity propels efficacy in its ranks which helps the firm to sustain the laid objectives of the firm. It provides flexibility to the resources and encompasses various modes of recreational activities which ensure that the resources’ competence and creativity at work never takes a hit (Uhl-Bien et al. 2014).
On the other hand, leadership plays an emphatic role and hence considered to be of supreme importance. Good management and leadership are deemed to be the edifices of the organization and the firm in consideration is no exception. The leaders set goals and all the teams strive to fulfill the desired goals and standards. It may not be possible for the firm to excel in every projects but leadership makes it possible that the firm puts forth its best foot forward for realizing the goals and desired objectives (Stocklin 2015). Leaders take the shots as far as corporate governance is concerned. Product analysis and feasibility of services and solutions are something that is undertaken by the top brass of the organization. One of the most important facets of leadership is that Google have a vast approach to envision things out of the box and the managers keep an eye of the employees’ performance and initiate corrective actions if required. All these amounts to the aspect of adequate leadership which propels the firm to perform sufficiently and appoint the right and competent person for the job (Maas and Jones 2015). The leaders give their resources not only deliverables but also direction and a mission which ultimately makes them what they are in the business domain. This is exactly in consonance to Ashridge Sense of Mission Model (Kimura 2013).
Google has been the frontrunner as far as diversification is concerned. In past years the industry had witnessed a paradigm shift with its focus shifting from core search business that had been popular over the years. Various experts argued that the firm had done the right thing to explore into other areas of operation. The CEO of the company is a proponent of Ashridge Mission Model. He opined that the company is still in nascent stage and on the cusp of a turnaround regarding innovative solutions and services (Martins et al. 2015). Changes have been observed recently with Sundar Pichai being vested with more responsibilities relating to core products of the firm. More than that, the management was able to give a proper direction to the entire firm which kept things on track by the organization. In recent years the firm had diversified its operations by tapping into healthcare domain and also revealed intention of making inroads into automobile industry. The firm is going in all directions by and aspires to make substantial deals in automotive domain with the driverless-vehicle technology. The fact of the matter is Google has grown to be a vast entity in terms of operations and diversifying its core operations in various avenues (Godwin et al. 2015).
The firm could not survive with a single strategy. However, investors are somewhat uneasy and precarious with the firm’s approach of mixing unrelated investments, businesses and acquisitions. The mission statement of Google and vision reflect powerful stature of the firm in terms of what it wants to achieve. The company being founded in 1998 has been observant of its vision and mission statement which leads to its current position as one of the brands to reckon with. The mission statement differs from its business strategies, like product development. Similarly, the firm’s vision statement impels the organization to attain new heights through rapid innovation and other practices. The success of the firm is frankly connected to the endeavors of the firm to fulfill the mission and vision statement. The vision statement of Google is providing access to the world’s information in a single click. The firm’s nature of business operation is nothing but actual manifestation what it states in vision statement. An instance would help in this regard. Google is by far the most popular product in its search engine service. The product facilitates people residing in various geographies to have access to information from around the world. The vision statement has three variables which are mainly, accessibility, world’s information, and a single click. The organization fulfills the entire world’s information element of its vision statement by the means of crawling webpages. The organization maintains huge databases which contains indexes of these websites. As a matter of fact the firm fulfills the accessibility part by presenting a host of search engine services and solutions to all and sundry based across the globe. On the other hand, the one click aspect refers to easy access to information. Google fulfills this particular component by presenting various innovative services and solutions such as Google Search (easy to use). Hence, it is clear that the company is complaint of its vision statement (Salem Khalifa 2012).
The mission statement is in conformity to the firm’s vision statement. Google’s mission statement has four different variables mainly, organization, world’s information, utility and global accessibility. As mentioned earlier, the organization fulfills the entire world’s information factor by crawling webpages. The firm organizes the plethora of information by the means of proprietary programs or for that matter, algorithims. The company fulfills universal accessibility facet of its mission statement by offering vast services universally. Such means of processing and organizing of information aids in effective search results. Thus, it is understandable that Google complies with the laid mission statement (Garud and Gehman 2016).
The firm is in conformity to what its mission and vision statement are. The organization is popular for effectual and innovative products, mainly, Google Search which specifies the firm’s statement. The leadership of the firm is in consonance to the universal accessibility constituent of the mission statement by making the firm’s services and solutions widely used. The innovative strategies add to the firm’s capacity to uphold the leadership the way it is in the industry (Rothaermel 2016). This colossal stature empowers the firm to maintain following of its vision and mission statement. Google should adapt its vision and mission statement in accordance to the variety of products that the firm presently offers. Google Glass and Fiber are the latest offering of the firm. The firm’s vision and statement remain identical though. Hence, adjustment should reflect present diversification of the firm’s products and solutions. Preferably, the vision statement should illustrate the future state of affairs of the company with regards to its diversified business. In true sense, the mission statement is meant to specify the firm’s intention relating to such diversification (Colquitt et al. 2012).
To effectively apply various strategic approaches and methods in various business environments a firm needs to be able to provide support each with fittingly differentiated culture and capabilities. Google has been successful in creating highly distinctive culture and ethos. The likes of campus ambassador programs, community approach and appetite for recruiting techies has contributed to its unique culture. Google has restructured its entire organization to attain ambidextrous move toward business, thereby benefitting both its ambitious projects and mature core business avenues. The firm’s move if a part of broader trend towards fission of business structures which is evident in corporate spins and splits. On the other hand, factors like capital allocation and taxation have considerable role to play in the same regard. It is imperative to apply more custom-made techniques relating to strategy and dynamic business environment which has been a key driver in terms of strategic management. This inspires effectiveness and dynamism to the business portfolio. The strategic thought process of most of the entities is shaped by the manner they go about their business (Fisher et al. 2016). Manufacturing units had a traditional foundation of a twenty century economy. The firms that create complex physical objects naturally plan their services and solutions in terms of lifecycles which ranges between one to two years. A technological giant like Google operates at a fundamentally varied pace. The web software changes constantly. The management does not plan rigidly but evolve it on a daily basis based on the response of the behavior of the customers. The firm has been successful in maintaining flexible approach towards strategic management and hence it has created thriving business products and solutions. This by far is a dramatic change as far as business history is concerned. Earlier, companies were normally smaller ones, volume wise. The larger is the size of the company, the more will it value planning along with long-term view. The factual reality is Google is one of the large technological entities who boast of flexible style of management which is opposed to rigid planning. Most large companies are run by professionals who hail from business schools wherein they get trained the nuances of traditional business affairs. Contrastingly, Google is controlled and run by engineering PHDs. Google follows scientific method in its management. It is evident in web design version of Google which says that everything can be measured. The Google executive version states that nothing really matters unless one can measure that. There are numerous instances in the past which states that companies were run by engineers. HP is a notable example in this regard. What makes the firm in consideration special is its combination of scientific method with rapid iterative development (Babnik et al. 2014).
Secondly, the unusual aspect of Google is the ownership structure of the firm. Google is not a public entity. The management of the firm is not too keen in terms of annual returns or for that matter, quarterly returns. Most organizations have detailed and long planning cycle pursuing their goals. Google is just the opposite. The firm boasts of an unpredictable planning cycle while pursuing long-term goals and objectives. This is where Google scores over other players. The firm’s behavior over the last few years has evolved (Rashid et al. 2014). The investors convinced the CEO about the need of bringing in professional management to organize the company. In the year 2011, the firm had huge economic resources and was no longer a dynamic entity in the business domain (Cobb 2016). The firm faced severe threats from emerging outfits like Facebook, which was growing in leaps and bounds that time. Like social networking, mobile deserves special mention in this regard. Apple was posing threat in mobile which was doing great job in terms of integrating software and hardware for producing superior products. Google is less effective in the event of change in the firm’s original goals. Google frequently initiates projects that may deem to be important but later turns out to be not so vital. Google Docs may be a great instance in this regard. It was launched as a response to Microsoft’s MS office OS. When the later became weaker, Google Docs merged with Drive and created Dropbox in coming years (Auvinen et al. 2015).
At the outset, the goal of this paper is to explore how to explore how the company’s strategic planning ploys have been adapted to a business world which is characterized by unpredictability and rapid changes. The below discussion identifies various key features of strategic planning in a business industry that witnessed stability as well turbulence. Like petroleum industry Google had also faced strategic planning and the changing of role within the company. Notwithstanding the debate whether strategic planning has merits, it helped in strategic planning within the oil companies. The oil companies formulated strategic planning practices during the late 1990s or so (Bolisani et al. 2015). It also portrays how the practices responded to ever-increasing environmental uncertainty and turbulence. As strategic management evolved, interest in organization’s strategic planning practices gradually faded. Various changes in oil companies pointed to a different role for strategic planning within the organizations. Strategic decisions were made as a response to threats and opportunities that surfaced and were integrated into the strategic plans. The purpose of strategic planning system was not to undertake strategic decisions but also how did it play within the company’s management. All the companies exerted greater emphasis on the knowledge and communication sharing role of processes. This involved paradigm shift from formal presentations to face-to-face discussions wherein beliefs and ideas were challenged and various issues were identified. Shell and Exxon are notable organizations in this regard. Both had special emphasis over strategic planning which acts as a vehicle of organizational learning. To maximize the organizational learning, Shell attempted to make explicit judgments and perceptions within the strategy process which may be termed as mental mapping. There is a startling similarity with Google as the concerned (Amann 2016).
Leader-member exchange (LMX) theory is focused on the two-way relationship between followers and leaders. According to this theory leaders develop exchanges with their every follower. As Harris et al. (2014) stated that, the quality of leader-member exchange relationship can influence the decision and responsibility of followers. It has also affected the performance and the access of resources for the followers. Leader-member exchange theory can promote positive employment experience. It can also increase organizational effectiveness. In this theory, it has been mentioned that leader have to develop strong emotional bonding with their followers depending on respect and trust (Kimura 2013). This theory claims that leaders do not treat all their followers equally. It suggests that supervisors have relatively high-quality exchange relationships with some employees and relatively low-quality relationships with others (Tse et al. 2013). The behaviors and work related attitudes of these subordinates decide how they are treated by their leaders.
LMX theory of leadership refers to the process of interactions between the subordinates and leaders of the organization. The theory emphasizes that leaders of a company i.e. Google must maintain a unique relationship with every subordinates and followers rather than practicing one particular leadership style in the enterprise. On an organizational level, leadership refers to relationships between members and the leader that is based on commitment, respect and mutual trust. The theory is very different from other theories of leadership (Van Wart 2013). Other theories of leadership include autocratic, transformational, participative, democratic, transactional, situational, etc. All these ideas define a particular style of leadership implemented in an organization. However, “leader-member exchange model” put stress on the relationships among the employees more accurately leaders and their followers of Google. The theory is also known as Theory of Vertical Dyad Linkage that explains how leaders in organizations maintain a good rapport with their team members through tacit exchange agreements (Ambrose et al. 2013).
Figure 1: Characteristics of leaders and follower and their interpersonal relationship
(Source: Harris et al. 2014)
As Hu and Liden (2013) mentioned that, the multitude of consequences can be measured in terms of the multitude of consequences. These consequences are like normative commitment, turnover intentions, empowerment, and distributive justice, satisfaction with payment and job satisfaction.
LMX is a descriptive theory that suggests that it is significant to find out the existence of the out-groups and in-groups within the company. Gu et al. (2015) mentioned that, this is the only leadership approach that makes dyadic relationship as the centerpiece of the leadership process. It shows the importance of communication in leadership approaches. According to Islam et al. (2013), the implementation of Leader-member exchange (LMX) theory in the company Google has decreased the turnover intention of its employees. It has also decreased the role conflict within the organization. It has also increased the attitudinal and perceptual outcome for the organization. The LMX theory helps to assess the degree to which followers and leaders in the organization have mutual respects towards each other’s capabilities. It helps to develop a strong sense of obligation for one another. In this organization the in-group followers work as the advisers or assistances for the leaders. It enables high-quality personalized exchanges with leaders rather than out-group followers in Google. These exchanges include emphasis of the leader on projects to interesting tasks, information sharing, delegation of important task to followers and taking advice from followers while taking important decisions (Azadnia et al. 2015).
The example of good leader can be found from this theory. Phil Jackson is the American professional basket ball executive. He is former player and former coach. He is presently working as the president of the New York Knicks in the National Basketball Association or (NBA) (Kimura 2013). He is always the best man to represent his team. He had always tried to create a supportive environment within an organization. He provided his followers the freedom to express their feelings. As Tse et al. (2013) stated that, it helps them to realize their own potential. According to LMX theory, productive leader-follower relationships must help followers to improve their performance. The example of Phil Jackson just has proved this fact. He did not have the capability to delegate all the followers by himself. For this reason, he had developed effective communication between coaches and player. For this reason, his team was able to won many championships. According to Phil Jackson “No leader can create a successful team alone- no matter how gifted he is.”
The theory is analyzed in the perspective of Google. Google is the company where employees are provided with enormous benefits. It is one of the most renowned businesses in all aspects especially in terms of best workplace. Employees all over the world provide positive feedback about the company. According to the employees of Google, it is one of the best places to work. The process of the theory consists of three stages namely role taking, role making and routinization (Tse et al. 2013). In the process of role taking, the leaders of the team point out the talents of the team. Leaders of Google are known for their leadership abilities. Leaders of different departments identify particular skills in every team members. After identification of the talent, the supervisor of the company tests their capabilities by providing them opportunities for growth. In this stage, a relation between the subordinates and the controller is started. Gradually, it grows deeper in due course of time (Yukl et al. 2013).
The next stage of LMX theory is role making. In this phase, an informal and unstructured negotiation is occurred between the leader and the team member. Google provided a particular function for the identified talent. In return, of loyalty and dedication, the head in all aspects supports the selected team members of Google. Leaders of Google start building trust with their junior members during this level of the LMX theory. Trust building and betrayal both are the factors that can be a possibility in this phase. When the member of the Google faces this situation, then there is a possibility of transfer of the individual into out-group. However, success of the individual depends on the support given by the leader. The degree of achievement of this stage depends on the lower level racial and cultural differences prevalent in the company. In Google, a strong organizational culture is maintained. The management of the organization tries every possible aspect in improving the loopholes of the cultural issues faced by Google. The relationship between leaders of Google and their team members strictly maintains professionalism. The next phase of the leadership theory is routinization. Google supervisors maintain a pattern of conversations related to social exchange with their subordinates. Social relationships are also a vital part in this aspect as it is related to the psychological concern of human behavior (Baran et al. 2012).
The example of good leader can be found from this theory. Phil Jackson is the American professional basket ball executive. He is former player and former coach. He is presently working as the president of the New York Knicks in the National Basketball Association or (NBA) (Kimura 2013). He is always the best man to represent his team. He had always tried to create a supportive environment within an organization. He provided his followers the freedom to express their feelings. As Tse et al. (2013) stated that, it helps them to realize their own potential. According to LMX theory, productive leader-follower relationships must help followers to improve their performance. The example of Phil Jackson just has proved this fact. He did not have the capability to delegate all the followers by himself. For this reason, he had developed effective communication between coaches and player. For this reason, his team was able to won many championships. According to Phil Jackson “No leader can create a successful team alone- no matter how gifted he is.”
The CEO of the company Sundar Pichai is known for its excellent leadership skills. The company runs on innovation, new product development, leadership and good employee relations. Every departments of the organization follow innovation. Google develops many leadership programs for their staff of all levels. There are many benefits of a leader following LMX theory. Google leaders experience multiple benefits in maintaining healthy relationships with their employees. The benefits include improved performance of groups, encouragement of employees in taking initiatives, influencing other members, extending capabilities and building networks. Employees of Google illustrate a small turnover intention with higher job satisfaction. They also highlight a well portrayed assistant leader relationship. However, it can be concluded that leaders of Google who follows the LMX theory of leadership are found to be more successful when compared to other supervisors of different organizations. The benefits of Google leaders in their team are greater organizational commitment, low turnover, higher team satisfaction, and better work performances. Hence, it can be said that by practicing this theory, Google leaders gets recognition from the company in terms of excellent perfection in the results of the assigned work (Gu et al. 2015).
LMX theory in Google not only helps in developing leadership for the senior leaders but also encourages junior executives to forecast their skills in the organization. Management of Google encourages employees to highlight their talent in the respective fields. Emphasizing on the employee relationships, the middle level management along with the lower level employees of the company are satisfied with their work. There are many researches done by many researchers regarding employee relations and satisfaction of employees (Mitchell et al. 2016). Every research report points out the name of Google in the top position in the above mentioned sectors. Higher degree in LMX relations results in greater access towards resources of organization. It leads to more benefits earned by the followers and subordinates of Google. When leaders have greater access to organizational resources, more benefits in terms of monetary and non-monetary aspects would be provided to the members. Hence, the employees of the company experience more perceived influence from the enterprise with rapid growth in career perspective. Internally the subordinates gain confidence and energy to solve more problems that are complex. Leaders of Google also indirectly improve the performance of the team by providing benefits to their employees along with rewards. In this case, leaders can fully trust their subordinates that help them assigning complex tasks to them. Every leaders of Google use specific tactics for improvement of their team. In this way, many new leaders are formed in the organization. Employees get recognition along with appraisal with their improved level of performances (Carter et al. 2013).
Apart from having positive aspects of the leadership model, there are many disadvantages and criticisms related to it. The concerns of this practice are faced not only by the leaders but also by the subordinates and organization as a whole. The role of leader and followers of Google are very different. The key responsibilities of a manager are more than that of supporters of the company. It is the duty of the leader to check the performance of the team. The supervisors often find wrong talent and forecast them in front of the senior management. It is a very negative drawback of the LMX theory (Harris et al. 2014). The supervisors must have in-depth knowledge about the each detail of the team members along with the designated work to the team. Failure in understanding the nature of the organization can result in disastrous results. Google professionals have to undergo many professional developmental programs for gaining perfection in their work. It is mentioned earlier that the company runs on innovation. Human resource department of Google hires real talent from different parts of a nation for a particular job designation (Govindan et al. 2015).
In many circumstances, it can be noticed that lack of communication between the team member results in lower degree of LMX theory implementation at organizational level. Apprehension in the field of communication is found to be an inhibitor in maintaining relationships between leaders and subordinates. However, once a problem is found in Google, the management of the company tries to solve it as soon as possible. Otherwise, it can hamper mindset of other employees along with productivity of the enterprise. Another disadvantage of this theory is giving preference to preferred employees that is unjustified. Supervisors often prefer their favorite executives unknowingly in a particular assigned task due to biasness. It results in negative impression of the leader in the team. However, negative concerns in a company like Google are very hard to find, but miscommunication can be occurred in every organization. Proper communication channel among every level of employees along with understanding of company’s vision and mission is the available solutions for leaders and organization as a whole to mitigate problems (Churchland and Kiani 2016).
LMX is a descriptive theory that suggests that it is significant to find out the existence of the out-groups and in-groups within the company. Gu et al. (2015) mentioned that, this is the only leadership approach that makes dyadic relationship as the centerpiece of the leadership process. It shows the importance of communication in leadership approaches. According to Islam et al. (2013), the implementation of Leader-member exchange (LMX) theory in the company Google has decreased the turnover intention of its employees. It has also decreased the role conflict within the organization. It has also increased the attitudinal and perceptual outcome for the organization. The LMX theory helps to assess the degree to which followers and leaders in the organization have mutual respects towards each other’s capabilities. It helps to develop a strong sense of obligation for one another. In this organization the in-group followers work as the advisers or assistances for the leaders. It enables high-quality personalized exchanges with leaders rather than out-group followers in Google. These exchanges include emphasis of the leader on projects to interesting tasks, information sharing, delegation of important task to followers and taking advice from followers while taking important decisions (Forgang 2015).
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