Google’s operations management involves different management teams and goals. Nonetheless, the company applies the 10 decisions of operations management in all of its business activities. In operations management, these 10 decision areas address the various activities that contribute to organizational success. For example, Google’s product design process directly relates to the design of goods and services decision area, as well as other decision areas of operations management, such as quality management (how to keep the product’s quality consistent) and job design and human resources (how to ensure the sufficiency of human resources for production). By addressing these 10 decision areas of operations management, Google maintains effective and efficient operations that fulfill profitability objectives.
The 10 decisions of operations management apply to Google’s businesses. The company uses a holistic approach to succeed in addressing these decision areas.
Google: 10 Decision Areas of Operations Management
1. Design of Goods and Services. Google’s product design involves different teams for the company’s various products. This decision area of operations management is applied based on market research, trends and forecasting. For example, Google uses forecasts of future expectations of users to develop cutting-edge apps for desktop and mobile users.
2. Quality Management. This decision area of operations management is applied at Google through iterative testing, debugging and innovation, and through user involvement. Iterative testing and debugging are used in the company’s facilities to ensure that products have minimal errors or bugs when released to the market. Also, Google frequently invites users to send error reports and reviews that the firm can use to improve product quality.
3. Process and Capacity Design. For Google’s web-based and software products, this decision area of operations management is of minimal consideration because the company maintains almost the same number of workers even if the demand for these products increase. Web-based or software products can be easily distributed through the Internet without significantly impacting the company’s HR capacity. Capacity design is addressed at Google through standardized conventional processes in software development. However, for goods like Nexus and Chromecast, this decision area of operations management has a bigger impact. Google applies process and capacity design through contract manufacturing. For example, Google develops its Nexus smartphones, but outsources the production to original equipment manufacturers (OEMs). Thus, the OEMs make decisions on process and capacity design for these Google products.
4. Location Strategy. For Google’s web-based digital products, this decision area of operations management is a minimal consideration because these products are distributed through the Internet. However, for support activities, the company maintains facilities around the world, such as offices in California and Singapore. For goods like Nexus and Chromecast, this decision area of operations management is applied at Google through networking with suppliers or original equipment manufacturers (OEMs).
5. Layout Design and Strategy. This decision area of operations management applies at Google in terms of the company’s design of its workflows and facilities. The firm is known for innovative and creative work environments. In developing web-based and software products, Google uses efficient workflows integrated with creative ideas for its offices, such as the ones in Googleplex in California. This strategy combines efficiency and creativity.
6. Human Resources and Job Design. Google’s human resource management addresses this decision area of operations management through emphasis on smartness and excellence in employees. The company favors smart employees, with less regard for experience. To retain talent, Google uses highly competitive compensation packages that include high salaries and incentives like free meals.
7. Supply Chain Management. Google uses its advanced information systems to manage its supply chain. For this decision area of operations management, the company analyzes inventory records to predict demand and inform suppliers and original equipment manufacturers (OEMs).
8. Inventory Management. In this decision area of operations management, Google’s inventory management uses different types of inventory that correspond to the needs of its various businesses. The company also uses automation to monitor and control inventory. Such automation is especially significant in managing Google’s inventory of web-based and software products.
9. Scheduling. In this decision area of operations management, Google has perfected the application of automation. The company automates certain processes, such as checks and monitoring of productivity levels. For the activities in offices, Google also applies scheduling through flexible approaches, in consideration of changes in the availability of employees.
10. Maintenance. Google needs to maintain information systems, servers and facilities. To do so, the company has dedicated teams for maintenance. These teams are classified as Operations & Support. Through the activities of these personnel, Google’s operations management keeps all equipment and facilities running smoothly to address this decision area.
Determining Productivity at Google
Google determines the productivity of its personnel based on a variety of criteria. The company has different kinds of operations because of the diversity of its products. Nonetheless, for operations management, the following are some of the notable productivity criteria at Google:
- Rate of error/bug correction
- Rate of stockout
- Rate of customers’ repeat complaints
The rate of error/bug correction is a measure of the productivity of Google’s personnel involved in product development and maintenance. These bugs are typically found in apps. The rate of stockout refers to the productivity of Google’s personnel involved in the supply chain. For example, this productivity measure is used for the supply chain for Nexus products. The rate of customers’ repeat complaints is the percentage of customers filing the same complaints again. In Google’s operations management, this measure indicates the productivity of personnel in addressing complaints.
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