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    CLA2 A Case Study On Alphabet Inc.

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    1. In 2015, Google restructured itself as Alphabet Inc. to increase transparency and allow for higher focus on individual businesses. 2. This restructuring led to a 19% rise in Alphabet's stock price in the year following as it increased investor confidence. 3. The restructuring enabled Google to experiment with new businesses without risking its core search brand, while also creating multiple revenue streams.

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    CLA2 A Case Study On Alphabet Inc.

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    Shrestha Press
    91 views15 pages
    1. In 2015, Google restructured itself as Alphabet Inc. to increase transparency and allow for higher focus on individual businesses. 2. This restructuring led to a 19% rise in Alphabet's stock price in the year following as it increased investor confidence. 3. The restructuring enabled Google to experiment with new businesses without risking its core search brand, while also creating multiple revenue streams.

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    CLA2 A case study on Alphabet Inc.

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    1. In 2015, Google restructured itself as Alphabet Inc. to increase transparency and allow for higher focus on individual businesses. 2. This restructuring led to a 19% rise in Alphabet's stock price in the year following as it increased investor confidence. 3. The restructuring enabled Google to experiment with new businesses without risking its core search brand, while also creating multiple revenue streams.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    91 views15 pages

    CLA2 A Case Study On Alphabet Inc.

    Uploaded by

    Shrestha Press
    1. In 2015, Google restructured itself as Alphabet Inc. to increase transparency and allow for higher focus on individual businesses. 2. This restructuring led to a 19% rise in Alphabet's stock price in the year following as it increased investor confidence. 3. The restructuring enabled Google to experiment with new businesses without risking its core search brand, while also creating multiple revenue streams.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 15

    A Case Study on Alphabet Inc.

    BUS 525 Strategic Management in a Globalized Economy

    Presenter
    1
    Manish Joshi
    Agenda
    1. Alphabet Inc.

    2. Restructuring into Alphabet Inc and Its Stock Price

    3. Impact of Google Decision to Restructure

    4. Expansion of Google Inc. into Non-Core Business

    5. Restructuring and its role in increasing company’s competitiveness,


    profitability and valuation

    6. Economic Ground For Alphabet’s Profitability

    7. Learning from PA1, CLA1, PA2 and CLA2

    2
    Alphabet Inc.
     Google Initially started as a search engines project in 1996 by Larry Page and
    Sergey Brin, PhD student of Stanford University

     Search engine website launched in September 1997 and company incorporated in


    September 1998

     Introduced “Page Rank”

     Named as ‘Backrub’ later changed to ‘Google’

     Initially sold advertisement associated with keyword search

     Started acquiring small companies since 2001

     Restructured itself as Alphabet Inc.


    3
    Restructuring into Alphabet Inc and Its
    impact on Stock Price
     Apart from forward or backward integration
    the firm invested in other business as well

     Googles investment in no-core activities


    raise concern to investors

     The financial represented all business into


    one as Google

     In 2015, Google Restructured itself as


    Alphabet Inc.
    Fig: Google’s Structure Before Reorganization

    4
    Structure of Google after Reorganization
    in 2015

    5
    Impact on Stock Prices

    • Higher Focus and Control on


    each business
    • Transparent financial
    statement
    • Positive Sentiment among
    Investors
    • Result

    19% rise in stock price on


    Y-o-y from October 2015
    to October 2016
    6
    Impact of Google Decision to
    Restructure

    1. Transparency in Financial Reporting

    2. High Focus and control over each businesses

    3. Enable Google to experiment and acquire new business


    without risk of losing its brand value

    7
    Expansion of Google Inc. into Non-Core
    Business
    Vision to maintain its position
    and remain financially strong
    in long term

    Why it was
    a good
    move ?
    Increasing Creation of
    competition in multiple
    Technology industry revenue stream

    8
    Restructuring and its role in increasing company’s
    competitiveness, profitability and valuation

    High Focus on Higher degree


    Individual of
    Business Transparency

    Enable
    Experimenting Limiting
    and acquiring Liability
    new businesses

    9
    Diversification as the Economic ground
    for Profitability
    Opted for high Level of Key Benefit from the
    Diversification diversification
    • Investment in Non-core • Value Creation
    businesses • Widens scope for generating
    • Since, other business are new revenues from multiple
    revenue; does not contribute source
    much then • Enables firm to benefit from
    growth in other sector
    • Value Neutral factor
    • Minimize dependence on
    single business

    10
    Findings from Starbucks Case
     Founded in 1971, Starbucks is the world's largest leading retailer,
    marketer, and a roster coffeehouse chain in the world.
     Competitive advantages that Starbucks seeks to establish:
     Brand Equity
     Consumer experience
     Offers the range of products
     Supply Chain
     Challenges faced by Starbucks
     Price issue
     Increasing competition
     Changing needs of customer
    Findings from CLA 1
     Case of offshore drilling: A case of Pacific Drilling Company
     Offshore oil drilling industry is the industry that involves the exploration and
    production of oil and gas from the seabed that are often located off continental
    coast.
     Types of offshore drilling:
     Jack- up rigs
     Semi-submersible Platforms
     Drillship
     Collaboration with Chevron to overcome challenges
     Challenges in Offshore drilling
     Technological Challenges
     Fluctuation in Oil Prices
     Competition in market
    Findings From PA 2
     About the two CEO of Apple Inc., Steve Jobs and Tim Cook
     CEO plays a major role in strategic management and is responsible for
    strategy formulation.
     The job of CEO is complex and challenging. The CEO of Apple, Tim Cook
    faced challenges such as meeting customer demand, increasing the
    company's sales, replicate the success of Jobs, spirit the innovation, and
    so on.
     Internal managerial labor market approach motivate employees and lead
    company with its own value set.
     The leadership styles of the CEOs, Steve Jobs and Tim Cook
    Findings from Alphabet’s Case

     Restructuring and Diversification

     Need for High Level of Diversification

     Benefits from diversification


     Value Creation

     Value neutral proposition

    14
    Reference

     Bettie, A. (2020, May 19). The Story Behind Google's Success. Retrieved from Investopedia:
    https://www.investopedia.com/articles/personal-finance/042415/story-behind-googles-
    success.asp
     Cohen, J. K. (2018, August 13). Has restructuring 'Google' as 'Alphabet' helped the company? 4
    things to know. Retrieved from https://www.beckershospitalreview.com/business/has-
    restructuring-google-as-alphabet-helped-the-company-4-things-to-know.html
     Hitt, M. A., Ireland , R. D., & Hoskisson, R. E. (2019). Strategic Management Competitiveness and
    Globalization. Boston.
     Kennedy, J. (2019, October 25). Buffett's Moat: Google's Competitive Advantage. Retrieved from
    Investopedia: https://www.investopedia.com/articles/insights/051316/buffetts-moat-how-
    sustainable-googles-competitive-advantage-googl.asp
     Yahoo Finance. (n.d.). Retrieved December 13, 2020, from
    https://finance.yahoo.com/quote/GOOG/history?
    period1=1102982400&period2=1607904000&interval=1mo&filter=history&frequency=1mo&include
    AdjustedClose=true

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