I recently read an interesting post evidently written by a Microsoft employee who had left that company to join Google and then returned after finding the grass wasn't so green on the other side of the fence. Google is well-recognized for providing one of the best working environments in the world, but like many companies that have been similarly revered, it appears to be systematically killing that environment, according to this post. This all sounded very familiar, and in Google I see the repeat of catastrophic mistakes made by IBM, Apple, Microsoft, Netscape, Sun, and Yahoo.
Of this group, Microsoft survived, IBM has nearly recovered, and Apple actually eventually became greater than it had ever been, suggesting the pattern need not be terminal. But Sun, Netscape, and likely Yahoo illustrate that it certainly can be the end of a once successful firm. Let's look back on how Google's inability to learn from the mistakes of others is setting the stage for its failure.
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The Microsoft-Google-Microsoft blog
I could have written a blog entry similar to the post describing how Google lost its way several times in my own career. It tells the very sad story of a company that started out founded on fairy dust and dreams that has suddenly had to face the twin realities of losing its focus and being rendered obsolete by Facebook. What is interesting is the writer, James Whittaker, left and then returned to Microsoft. I imagine this was because Microsoft is in a steady state, while Google is in transition, and transitions are incredibly painful and demotivating, particularly when they come at the expense of cherished entitlements.
Whittaker also tells the story of a company that has lost its way in a desperate need to be seen as successful, one that misinterpreted Steve Jobs' advice about focus and simplicity. Google is simplifying and focusing on people, which is consistent with the Jobs' counsel, but the company appears to have skipped the part about deciding what they are good at and focusing on that. Google still seems to be chasing Microsoft, Apple, or in this post, Facebook. This last elusive target has been a recurring theme and one that has contributed to the crippling of a lot of great companies.
IBM now is focused
When I first ran into this problem, it was as an internal analyst at IBM. The company owned the tech market and was actually operating under what we now know as a SaaS model. In fact, it was arguably even more advanced, in that everything was pretty much a service. Corporate leaders saw the personal computer emerge and viewed Apple as a threat. They responded by creating the IBM PC and partnering with Microsoft as a block to Apple, and then they saw Sun come up and decided to sacrifice the mainframe on the altar of client-server computing. Next, they identified Microsoft as a threat and decided to do outsourced software with OS/2.
Each attempt to become another company further weakened IBM to a point where the firm almost failed. Now that IBM has shifted gears and is focusing on being the best IBM it can be, the company doesn't appear to be trying to be Google or Facebook, and shares are trading higher than they have ever traded.