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Engineering Googles Innovation Machine

"While the internet is of course available to every company, Google has made major investments to get more out of it and to construct a proprietary platform that supports new and growing online services. According to unofficial but widely reported statistics, Google owns a network infrastructure consisting of approximately one million computers; these run an operating system that allows new computer clusters to plug in and be globally recognized and instantly available for use. The operating software that performs this magic is a customized version of open source Linux (which itself is built to make it easy for third parties to add features of competitive value). Another aspect of the infrastructure is that the internet platform is built to scale. For example, when Google needs more data centers, the proprietary operating system makes them easy to add. And the company can move data around the world seamlessly to meet changing user demand. Managing the petabytes of data Google accumulates requires special database-management tools. Because existing commercial systems couldnt efficiently support such large volumes of data, Google developed a proprietary database called Bigtable, which is tuned to work with Googles operating system to process growing volumes of data quickly and efficiently." Even among internet companies, Google stands out as an enterprise designed with the explicit goal of succeeding at rapid, profuse innovation. Much of what the company does is rooted in its legendary IT infrastructure, but technology and strategy at Google are inseparable and mutually permeablemaking it hard to say whether technology is the DNA of its strategy or the other way around. Whichever it is, Iyer and Davenport, of Babson College, believe Google may well

be the internet-era heir to such companies as General Electric and IBM as an exemplar of management practice. Google has spent billions of dollars creating its internet-based operating platform and developing proprietary technology that allows the company to rapidly develop and roll out new services of its own or its partners devising. As owner and operator of its innovation ecosystem, Google can control the platforms evolution and claim a disproportionate percentage of the value created within it. Because every transaction is performed through the platform, the company has perfect, continuous awareness of, and access to, the by-product information and is the hub of all germinal revenue streams. In addition to technology explicitly designed and built for innovation, Google has a wellconsidered organizational and cultural strategy that helps the company attract the most talented people in the landand keep them working hard. For instance, Google budgets innovation into job descriptions, eliminates friction from development processes, and cultivates a taste for failure and chaos. While some elements of Googles success as an innovator would be very hard and very costly to emulate, others can be profitably adopted by almost any business. How does Google innovate so well, and how can you emulate it? Googles organizational design appears to be optimized for succeeding at rapid, profuse innovation. The companys tight integration of technology and strategy makes it hard to determine which is foundational for its success. While acknowleding that we dont know whether the companys success will continue so strongly, Iyer and Davenport believe Google may well deserve to supplant such companies as General Electric and IBM as an exemplar of management practice. In this article, the authors set forth what they see as several key innovation practices that other companies could beneficially adopt. Googles success is supported by excellence at IT and business architecture, experimentation, improvisation, analytical decision making, participative product development, and the balancing of chaotic ideation process with a set of rigorous, data-driven methods for evaluating ideas. Most

businesses would find it impractically difficult and expensive to emulate Googles categorykilling search engine and massive, scalable IT infrastructure. Other attributes are more feasible, including technology explicitly designed for innovation, and a carefully thought out organizational and cultural strategy. The authors make several recommendations for companies wanting to embrace some of Googles winning attributes. These include practicing strategic patience, ruling your own innovation ecosystem that enables architectural control, and exploiting an infrastructure built to build. The latter means developing scalability; an accelerated product-development lifecycle; and support for third-party development and mashups. Another crucial element is the way in which Google has built innovation into its organizational design by budgeting innovation into job descriptions, eliminating friction at every turn, letting the market choose, and cultivating a taste for failure and chaos. These allow Google to attract the most talented people and keep them working hard. The chaotic elements of the culture and organizational design are balanced by a strong requirement to support inspiration with data.