Alphabet Google Wants to Spell GE
March 28, 2016
I read a whizzy MBA-in-Silicon-Valley type analysis of the GOOG, which is now Alphabet. After working through the write up, I focused on one statement as interesting:
One way to understand Alphabet is as a vehicle to build essential physical infrastructure in the real world. What if you were to build a next-generation GE today?
GE had Neutron Jack, whom I had the pleasure of meeting. My employer (which shall remain nameless) screwed up a project and GE refused to pay a six figure bill. My boss took me to a meeting to learn how to get the bill paid AND to sell more work to Neutron Jack. To cut to the cob, my boss sold a $1 million job and got the unpaid bill settled in full.
What’s the difference between the new Google as described in “Learning Larry Page’s Alphabet”?
The answer is not Neutron Jack, although he was a canny manager. The answer is, “My boss.”
The Alphabet Google thing is riding high. It has more money in the bank than the current president of the University of Louisville. (Keep trying, Dr. Ramsey. Keep trying.)
For Alphabet Google to become more than an online advertising outfit, the company is going to have to do more than cook up science club projects. A person who can look adversity in the eye (Neutron Jack) and then manage the situation into a big payday has to have his or her hands on the steering wheel. Sorry, an autonomous auto kill switch won’t do the job.
The article pivots on the assumption that many motor boats can maneuver more quickly than an aircraft carrier. How has that worked out at Google. After more than 15 years of effort, Alphabet Google’s stallion remains saddled with Steve Ballmer’s insight:
Google is a one trick pony.
I noted this passage in the write up:
Here’s another way to view the company’s costly moonshot habit: as a marketing expense.
Isn’t that evidence for the one trick pony observation by a person who owns a basketball team?
What’s the strategic vision? I highlighted this passage as a possible answer to the question:
This is why Alphabet is more than just a spectacular corporate reengineering. Page picked the perfect time to reset his company—at the very moment that analysts were heralding Peak Google. He knew that traditional corporate structure limits innovation at the pace he wants and needs. He broke his business into smaller pieces to make them simpler and focused them more narrowly to discourage drift and distraction, while trying to maintain the advantages of scale and resources and a compelling culture to recruit talent. Page isn’t ready to settle for status quo. He wants to make the world a better place—with electric cars and smart cities and universal Internet access and no more disease—and also find lucrative new businesses that keep the company part of the present and future. He wants everything, from A to Z.
The friction building in the Alphabet Google machine may cause the rocket ship to veer off course. Alphabet Google has to traverse the air space of the EC, Russia, and China. The US does not have a “no fly zone” in place to bedevil Google…yet. And there is the pesky annoyances doing business as Amazon and Facebook.
Stephen E Arnold, March 28, 2016
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