Leaders are in the business of change. Every good leader constantly re-aims the arrow to the dead center of the target. It is not always large changes, but it is intentional, well-planned tweaks and fixes that shape the way they move forward. But then there are times a leader needs to completely restructure.
Last August, Google announced one such restructure. Larry Page announced on August 10th, “For Sergey and me this is a very exciting new chapter in the life of Google—the birth of Alphabet.”
Over the years Google has gone from a tech company who maintains a search engine and email, to a company fascinated by drones, pharmaceuticals and venture capitalism. With so many interests and ideas, Page stated, “we think we can make it cleaner and more accountable.” In short, he explained that,
Google is changing its corporate structure to reflect that it has essentially become a holding company with a disparate collection of businesses.
What Will Be Separated Under Alphabet?
So what will Alphabet look like? The New York Times reports each of these will become individual companies:
- Google, a company focused on search, YouTube, Maps, etc.
- Calico, an anti-aging biotech company
- Sidewalk, a company focused on smart cities
- Nest, a maker of Internet-connected devices for the home
- Fiber, high-speed Internet service in a number of American cities
- Investment arms, such as Google Ventures and Google Capital
- Incubator projects, such as Google X, which is developing self-driving cars and delivery drones
What Does This Teach Leaders?
1. All things are not equal
Google leaders, Sergey Brin and Larry Page, have many different passions and ideas. However, they are well aware not all their passions and ideas are equal. For example, Google’s advertising and Youtube are performing extremely well; as Wing, their drone delivery effort is still being tested—not knowing if it will ever get off the ground.
In order to fund their next endeavors, they need to continue focusing on the most profitable part of their business, i.e. Google “Proper.”
This is a critical lesson for leaders. We all have passions outside of our normal scope of work, however it may not be the most beneficial use of our time and energy. We must continue to push forward on the most profitable endeavors—which can fund the not-so-profitable ones.
2. The need for clarity and accountability
As an organization grows, clarity and accountability are vital to its health. Too often, companies change just for change sake. Instead, Google is changing in order to create clarity. I am sure with so many different projects, it became difficult to communicate, as well as, knowing who was making the decisions. This restructure helps create the clarity needed for a healthy organization.
Furthermore, restructuring is better for accountability because each of the 7-8 companies will have a CEO reporting to Alphabet Inc. Brin and Page will be able to take a step out of the daily operations, focusing on accountability. This puts ownership on the CEOs for higher performance and profitability.
3. Set a clear time for dreaming
Brin and Page are dreamers. They believe the world can be changed by the resources they own. They have spent many hours dreaming. They have spent many hours testing those dreams in order to see them become a reality.
Leader, are you setting aside time to regularly dream about your organization, department or even your blog? Times like these help one to refocus on the purpose you have in this life.
4. Being uncomfortable keeps you on top
Page plainly states, “In the technology industry, where revolutionary ideas drive the next big growth areas, you need to be a bit uncomfortable to stay relevant.” This is true not only for the technology industry, but for every other industry on this planet.
The leaders that last are the ones who continue to be uncomfortable, to take chances—albeit calculated ones.
Time to Restructure?
At minimum, Google’s restructure reminds leaders that they need to be continually focusing on the most important things. Maybe after seeing this news, some of you will consider restructuring your blog, department or organization. It will never be easy, but it will always be necessary to stay on top.