Leadership change at Google, and what it means

Posted on January 23, 2011 by Aman Sharma
Larry_page

Being a business professional myself, it interests me a lot observing leadership patterns among corporations. In my blog post Is Steve Jobs indispensable to Apple?, I had analyzed how leadership has panned out at Apple. With Larry Page taking over the reins from Eric Schmidt at Google, it would be interesting to study what the leadership change means for the search engine giant!

Larry Page : Who is he?

  • Born into a Jewish family in 1973, Larry Page is an American computer scientist, software developer and entrepreneur.
  • He is best known as the co-founder of Google when, in 1998, he teamed up with Sergey Brin (His Stanford University mate) to set up the best web search engine ever!
Larry Page Married (2)

Larry Page with wife Lucinda Southworth

  • He is married to Lucinda Southworth, who is a research scientist and sister of actress and model Carrie Southworth.

Background to the leadership change

Google has been facing several challenges and we need to put them in perspective as we delve into the aspect of leadership change.

Challenge 1 : Brain drain from Google.

  • Lacking in a free wheeling and youthful spirit as well as nimbleness required to fight competition. Perceived as bureaucratic.
  • Slow decision making a bottleneck at the top, with triumvirate (Eric-Page-Brin) structure. All decisions debated and agreed upon.
  • Google not able to translate all the good ideas its talented people develop into big, profitable growth.
Challenge 2 : Competition : Facebook, Groupon, Twitter etc pose competition, with Facebook being the most potent threat. Google has failed so far in its attempts to enter the social media space.
Challenge 3 :: Revenue Streams : Google is still over dependent on search advertising for revenues, where growth has slowed. Though Google has diversified, alternative revenue streams need to be developed really fast.
Challenge 4 : Greater scrutiny from regulators.
  • Acquisitions getting stalled
  • Privacy of consumer data.

Challenge 5 : Doubts that the Google search engine is losing its punch, as rivals, like Bing,  catch up.

Eric Schmidt and Larry Page : A comparison of leadership traits

Here is a tabulation of the comparative leadership traits of Schmidt and Page, which will give us a clear idea where Google is headed!

Eric Schmidt

Larry Page
Formal Informal. Wants to have a free-wheeling and youthful spirit within Google
Process Oriented. Gravitated towards budget and policy. Adherence to processes should go hand in hand with speedy decision making. To that extent, he shows little care for matters like budget and policy.
Corporate Mentality “My goal is to run Google at the pace and with the soul of a start-up” – Larry Page
Actively cultivates a broader profile with public speeches about economics and establishing greater ties in Washington. Keen on playing an advisory role in the public sector. Introvert. Keeps a low profile outside Google. Since the birth of a child, he has adopted an even lower profile.
Core strength – People skills. This quality was lacking in the young co-founders Page and Brin when Schmidt was hired. Core strength – product strategy. Displayin
g people skills would be a challenge.
Risk taking – definitely measures lower as compared to Larry Page More of a risk taker. Will encourage teams to work on risky projects
Social media presence – Eric is active and not media shy Larry Page isn’t active on Twitter, Facebook or Linkedin. He is said to be ‘disdainful of marketing and public relations.”
Under Schmidt, Google is efficient but it has also lost its ability to come up with a clear vision and execute it. Larry Page is expected to be a visionary CEO, as Steve Jobs is for Apple.

Conclusion

  • Leadership change has been executed to streamline decision making and create clearer lines of responsibility and accountability. Larry Page will oversee day-to-day operations. Sergey Brin will focus on Strategic Projects, such as new projects. Eric Schmidt will be an advisor to Page and Brin as Executive Chairman.
  • With Larry Page taking over as CEO, we will see Google have a clear vision, product strategy and decisive efforts towards developing alternative revenue streams.
  • More risk taking on the product side is clearly in the offing. I will not be surprised if Google comes up with another gem (as they did with the search engine!)
  • Page might miss the people skills of Eric Schmidt, but with a vibrant culture of innovation, he should more than make up for it!

What is your reading of the leadership change at Google? Do you feel Larry Page has the right skill set for a CEO? Which way do you see Google going from here? Views are welcome!

References

About Aman Sharma

Management Professional.
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