Reference no: EM13657901

Google was established with a clear mission in mind: to organize the world's information and make it universally acceptable and useful. Google has developed a search engine that accesses information from all over the web for the user. On the back of its popular search engine, Google has also built a highly profitable advertising business. One of the founding values of the company is captured in the mantra "don't be evil" that Google takes very seriously.

When a company goes global, it is likely that some of the values may conflict with the realities of an international context. The company then has to decide a pragmatic solution, based on its true beliefs, without compromising on its values, to maintain the credibility of its operations and culture among its stakeholders.

As an investigative reporter writing an article on the difficulties of maintaining a firm's vision, mission, and core values when entering global markets. As part of the research into that article, you are considering the ethical dilemma faced by Google as they expand into China. As you are making your notes for the article, you have noted three questions for further research and thought, as well as a need for a facts update. Given those notes you have determined to address the following outline items in an executive summary to your editor:

Factual Update on Google's current situation in China
Conflicts facing Google's management team, and board of directors in evaluating their ideal corporate mission against the challenges faced by Google by operating conditions in China.
Evaluation of how the concept of "moral courage" applies to Google as it weighs its corporate future in China, one of the largest potential worldwide emerging markets.
Exactly who are Google's stakeholders and how do they affect the options open to Google?

Closing Case: Google's Mission, Ethical Principels, and Involvement in China

Google, the fast growing Internet search engine company, was established with a clear mission in mind: to organize the world's information and make it universally acceptable and useful. This mission has driven Google to create a search engine that on the basis of key words entered by the user will scan the web for text, images, videos, news articles, books, and academic journals, among other things. Google has built a highly profitable advertising business on the back of its search engine, which is by far the most widely used in the world. Under the pay-per-click business model, advertisers pay Google every time a user of its search engine clicks on one of the paid links typically listed on the right hand side of Google's results page.

Google has long operated with the mantra "don't be evil"! When this phrase was originally formulated, the central message was that Google should never compromise the integrity of its search results. For example, Google decided not to let commercial considerations bias its ranking. This is why paid links are not included in its main search results, but listed on the right hand side of the results page. The mantra "don't be evil", however, has become more than that at Google; it has become a central organizing principle of the company and an ethical touchstone by which managers judge all of its strategic decisions.

Google's mission and mantra raised hopes among human rights activities that the search engine would be an unstoppable tool for circumventing government censorship, democratizing information, and allowing people in heavily censored societies to gain access to information that their governments were trying to suppress, including the largest country on earth, China.

Google began a Chinese language service in 2000, although the service was operated from the United States. In 2002, the site was blocked by the Chinese authorities. Would be users of Google's search engine were directed to a Chinese rival. The blocking took Google's managers totally by surprise. Reportedly, co-founder Sergey Brin immediately ordered half a dozen books on China and quickly read them in an effort to understand this vast country. Two weeks later, for reasons that have never been made clear, Google's service was restored. Google said that it did not change anything about its service, but Chinese users soon found that they could not access politically sensitive sites that appeared in Google's search results, suggesting that the government was censoring more aggressively. (The Chinese government has essentially erected a giant firewall between the internet in China and the rest of the world, allowing its censors to block sites outside of China that are deemed subversive).

By late 2004, it was clear to Google that China was a strategically important market. To exploit the opportunities that China offered, however, the company realized that it would have to establish operations in China, including its own computer servers and a Chinese home page. Serving Chinese users from the United States was too slow, and the service was badly degraded by the censorship imposed. This created a dilemma for the company given the "don't be evil" mantra. Once it established Chinese operations, it would be subject to Chinese regulations, including those censoring information. For perhaps 18 months, senior managers inside the company debated the pros and cons of entering China directly, as opposed to serving the market from its U.S. site. Ultimately, they decided that the opportunity was too large to ignore. With over 100 million users, and that number growing fast, China promised to become the largest Internet market in the world and a major source of advertising revenue for Google. Moreover, Google was at a competitive disadvantage relative to its U.S. rivals, Yahoo and Microsoft's MSN, which had already established operations in China, and relative to China's homegrown company, Baidu, which leads the market for Internet search in China (in 2006 Baidu had around 40% of the market for search in China, compared to Google's 30% share).

In mid 2005, Google established a direct sales presence in China. In January 2006, Google rolled out its Chinese home page, which is hosted on servers based in China and maintained by Chinese employees in Beijing and Shanghai. Upon launch, Google stated that it objective was to give Chinese users "the greatest amount of information possible". It was immediately apparent that this was not the same as "access to all information". In accordance with Chinese regulations, Google had decided to engage in self-censorship, excluding results on such politically sensitive topics as democratic reform, Taiwanese independence, the banned Falun Gong movement, and references to the notorious Tiananmen Square massacre of democratic protestors that occurred in 1989. Human rights activists quickly protested, arguing that Google had abandoned its principles in order to make greater profits. For its part, Google's managers claimed that it was better to give Chinese users access to a limited amount of information, than to none at all, or to serve the market from the United States and allow the government to continue proactively censoring its search results, which would result in a badly degraded service. Sergey Brin justified the Chinese decision by saying that "it will be better for Chinese web users, because ultimately they will get more information, though not quite all of it". Moreover, Google argued that it was the only search engine in China that let users know if search results had been censored (which is done by the inclusion of a bullet at the bottom of the page indicating censorship).

Requirements:
Overall presentation of assignment in executive summary format- "as an investigative reporter"

Identification of conflicts between mission and role in China
Morale Courage concept and reality of their corporate future

Clear identification of shareholders and how they impact future options

Insight added by updated information since case written (5 Points)

Total Points=45