With initiatives like radical decentralization, small, self-managing teams, and a willingness to let engineers spend sizeable chunks of time on offbeat projects, is Google changing how we manage companies? WSJ has just launched a
discussion thread on this topic. Will this approach create a second act for Google or is it an one-act wonder? Recent work in strategy emphasizes what are called dynamic capabilities. This gives firms the ability to respond to changes in the environment. As technologies and market shifts, firms having this capability can adapt by reconfiguring existing resources, or develop new ones by reallocating resources and learning new skills. Given that Google is a product company, we can see this in their product platform strategy. Individual entrepreneurs are able to innovate on that platform by building on prior work. In addition, the modular development of components give Google the ability to mix and match pieces to respond to market changes. Their investment in the platform architecture, in addition to decentralization, team structure and innovative culture, gives them this dynamic capability.