Abstract

This paper analyzes Alphabet Inc., a multinational conglomerate whose headquarters are in Mountain View, California. The analysis focuses on the financial and strategic priorities of the firm. Further, the paper explores the non-financial factors that give it an edge over other firms, which it should exploit maximally. The most significant internal risks that Alphabet Inc. grapples with are also stated in the document.

Introduction

Alphabet Inc. is a successful holding company. With firms like Google and Other Bets, which have multiple products in their profiles, the firm almost operates as a monopoly in the industry (“Reuters,” 2019). With its known brand Google, Alphabet Inc. has outshined its rivals like Apple and Amazon. Success factors like brand popularity, innovation, share sales, and employees make Verizon successful.

Financial and Strategic Priorities

Capitalizing on Local Mobile Search. Local mobile search is anticipated to grow in the future, earning the firm more revenue. Search aided by location is steadily increasing at a rate higher than 50% in 2017 (Sparks, 2018). The growth, according to SundarPichai, the CEO, has encouraged Google to invest in building an experience from which businesses, advertisers, and people will benefit. Local mobile search is among the rapidly growing areas in strategic investment, an aspect that Google plans to capitalize on. Local mobile search is a fast-growing sector that Alphabet will invest in for future benefits.

Selling Shares. Alphabet Inc. has sold off shares to raise finances. Under SundarPichai, the firm sold tens of thousands of shares, which is set to happen until March 2019. The sale began in January with the average cost of a share being 1086.33 dollars (Insider, 2019). After that, the stock price declined by 0.49%. By February, 10,000 stocks were selling at 1023.13. In March 2019, the Chief Accounting Officer is expected to sell 80 shares of GOOG at an average cost of 1041 dollars. The firm is selling its shares to the public to raise more funds for its operations.

Google’s Investment Plans. Through Google, the firm has invested in multiple ventures. Google has partaken in ventures like artificial intelligence, direct corporate ventures, and large stage deals (Rowley, 2018). Concerning corporate ventures, Google gives 50,000 dollar grants to companies in continents like Europe and Africa. On AI, Google will focus on engineering, ecosystem, and social challenges.There is also a 13 billion dollar investment by Google to expand offices and data centers in 14 states of the USA. Through Google, Alphabet Inc. has invested in ventures that will increase its market share.

Capitalizing on non-financial Factors

Innovation.  Alphabet Inc. is an innovation leader. Google’s innovation is what gave it an edge over Apple, its long-time rival (Mourdoukoutas, 2018). Google states that innovation is the core function of every worker in its organization.Correspondingly, the firm has innovation pillars that include having a shared vision, risk-taking, collaboration, and autonomy (Stillman, 2019). The technologies, such as AI and wireless vehicles, Google Glass, Chrome Books, Street Vision, and smartwatches. The creations make Google, and Alphabet Inc. by extension, an innovative company. Google promotes an innovative environment, which enables it to create innovative products.

Employees. Employees are Google’s best asset, and it treats them just as special. Google has been ranked the best employer in multiple lists like Forbes’ World Best Employer’s List, Glassdoor’s Top Five Places to Work For, and Fortune’s List. Such high rankings reflect the positive environment that Google creates for its workers by engaging them actively (Mourdoukoutas, 2018). Google’s innovation principles hinge heavily on good employee relations, which it says are critical in the technology industry. Through research and development efforts, the firm nurtures the talents of its task force. The employees also have autonomy in their work environment, which nurtures their growth. Google’s workers are included in their activities, making them productive.

Brand. Google is a known brand. The firm is the second most popular brand in the world (Frohlich&Sauter, 2008). The impact that Google has on the community is unrivaled. People use Google products in their daily lives, making it undoubtedly popular. Some products like YouTube is the world’s most used smartphone software, while Android is the largest distributor of advertising. As a recognized brand, Google has an impact on the community.

Significant Internal Risks

Self-organization is a daunting challenge for Alphabet Inc. Alphabet’s management still faces the problem of organizing the Other Bets, whose profitability has not matched Google’s (Love, 2017). The management is yet to show its plan to make Other Bets a money-making firm like its partner Google. The workers are uncertain how much time and resources would be used to boost Other Bets. The organization challenges in Alphabet Inc. has left executives and other workers confused.

Overreliance on advertising revenues. Alphabet Inc. heavily depends on advertisement revenues. Although the venture has remained successful, concerns from international firms could plummet its income. For instance, AT&T, Nestle, Fortnite, have removed their advertisements amid security concerns (Lamern& Anderson, 2019). If such fears spread to other companies, Alphabet’s profits may plummet in the future. Alphabet Inc. risks losing money if firms continue to pull down their advertisements from their sites.

Conclusion

Success factors like brand popularity, innovation, share sales, and employees make Verizon successful. The firm should continue to capitalize on this popularity to safeguard its share in the market. However, Alphabet Inc. should be wary of its internal problems like losing customers and organization to ensure sustainability.

References

“Reuters.” (2019). Alphabet Inc. (GOOG.O). Reuters. Retrieved From https://www.reuters.com/finance/stocks/overview/GOOG.O

Frohlich, T. &Sauter, M. (2018). What are the world’s most valuable brands? Tech companies like Apple, Google, and Amazon. USA Today. Retrieved From https://www.usatoday.com/story/money/business/2018/10/09/most-valuable-brands-apple-google-amazon/38061893/

Insider. (2019). Alphabet Inc (GOOG) CEO, Google LLC SundarPichai Sold $10.9 million of Shares. Guru Focus. Retrieved From https://www.gurufocus.com/news/801549/alphabet-inc-goog-ceo-google-llc-sundar-pichai-sold-109-million-of-shares

Lerman, R. & Anderson, M. (2019). Major Companies Are Pulling Ads From YouTube Over Pedophile Concerns. Time Magazines. http://time.com/5535328/pulling-ads-youtube-pedophilia-comments/

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Mourdoukourtas, P. (2018). Google Is Getting Ahead Of Apple. Forbes Magazine. Retrieved From https://www.forbes.com/sites/panosmourdoukoutas/2018/02/11/google-is-getting-ahead-of-apple/#28b7c3087d88

Rowley, J. (2018). A Peek Inside Alphabet’s Investing Universe. Tech Crunch. Retrieved From https://techcrunch.com/2018/02/17/a-peek-inside-alphabets-investing-universe/

Sparks, D. (2018). How Alphabet, Inc. Is Investing in Its Future. Motley Fool. Retrieved From https://www.fool.com/investing/2018/07/27/how-alphabet-inc-is-investing-in-its-future.aspx

Stillman, J. (2018). Here Are All the Tools Google Uses to Encourage Innovative Thinking Absolutely Free. Inc. Retrieved From https://www.inc.com/jessica-stillman/the-5-essential-ingredients-of-a-truly-innovative-team-according-to-google.html

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