Google is one of the most trusted internet service providers which has millions of users all over the world. The user-friendly search engine has been in the number one position leaving behind companies such as WebCrawler (Ledford 2015). It has diverse product offering and its ease of use has made it immensely popular globally. However, the company has suffered many ethical issues and lack of data privacy. There was widespread debate about the tracking of personal information which is not acceptable by majority of the people. There are instances when the search engine keeps the previously entered information in the same web browser. This has made the company to face wide criticisms as the users argue that this act was done without taking prior consent. There were also a large number of legal battles that were fought by the company regarding this issue.
This report is based on the case study named “Google: The Quest to Balance Privacy with Profits” and the associated three questions. It would identify the ways Google can use to improve the services provided to the stakeholders. It would also determine the various types of stakeholders and how the company can improve their lives. The report would analyze the balance that should be kept by Google between respecting user privacy and generating revenues. The third aspect of the report would concentrate on the changes in the business operations of Google due to government regulations.
Use of power by Google to improve the lives of its stakeholders
Google is a multinational company of global repute which has delivered excellent services to its customers (Google.com 2017). The primary product of the company has touched the lives of millions of people. The user-friendly search engine makes it easier for people to search according to their needs. The company not only manages search engine but also helps the individuals in the management of their personal information. The company has revolutionized the way the individuals store as well as access the information (Google.com 2017). The customers are able to receive important reminders regarding expiring or renewing things and they are able to access all their required information through any devices of their choice such as TV, laptop, phone and others (Google.com 2017). They are also able to store their personal pictures, videos and others in the huge server provided by Google. The ability to do these things is closely related with privacy. The customers are concerned about their data privacy and want the company to ensure that their personal data is safe and secure. Since almost 85% of the personal data is being linked to Google, the company must ensure privacy and security of them (Google.com 2017).
The case study revealed that the company has always worked hard to improve the life of its important stakeholders (Ferrell Fraedrich and Ferrell 2016). It is concerned with the wellbeing of both the employees and the customers, which has resulted in its widespread popularity. It takes sincere efforts to make the life of the people easier. The case study also revealed that the company is always looking for innovative ways to enhance the product line of the company (Ferrell Fraedrich and Ferrell 2016). The innovative ways would also ensure that there would be improvement in the work environment and it would also ensure providing quality services to the employees.
The stakeholders of Google are diverse and the reason behind this is the wide product range of the company. The products of the company range from the original product to the latest products like Google Fiber and Google Glass (Schmidt and Rosenberg 2014). Google gives high importance to its stakeholders such as users, employees, advertisers, governments, investors and communities (Mook et al. 2015). It gives highest importance to the users who directly or indirectly use the products of the company (search engine, Chrome or others). Google considers the stakeholders to be important since it defines the company’s popularity (Google.com 2017). The popularity is directly proportional to the business value of the company.
Google has expanded its business in a number of ventures such as book publishing, advertising, mailboxes and social networking (Westerman Bonnet and McAfee 2014). The company has also experienced many ethical issues during its course of operation. The company has been accused of the violation of copyrights by the publishers for publishing millions of e-books (Google.com 2017). They accused Google of violating the “antitrust” laws.
The issue of online user privacy has been a debatable topic for the past few years (Ur and Wang 2013). This is because of the fact that the search engine keeps the information entered by the users in the web browser and it doesn’t seek the permission of them (Google.com 2017). However, the company aims to improve the privacy of the users by stating it clear in the company privacy statement, which elaborately informs the users about this concern (Google.com 2017). There have been other similar attacks regarding the business policies of the company which has made the company to implement good business practices. It has taken dedicated efforts towards becoming responsible corporate citizen and handle the ethical issues attached with it.
The company has given topmost priority to its different kinds of stakeholders. The company uses its capability to increase the satisfaction rates of its stakeholders (Google.com 2017). Google provides an intelligent search engine that helps millions of people to gather knowledge in their subject (Halavais 2013). The customers can use it for different purpose and it is portable too, which implies that it can be accessible while travelling. It is useful in making the people stay connected with their friends and colleagues. People can also use Google Maps for the purpose of navigation through their state or city.
Google believes in the fact that it would not be possible without the contribution of the employees in order to give excellent services to the customers (Google.com 2017). Google is considered as the “best places to work” and it defines the capabilities of the company. They do not support the idea of only work and hence it has incorporated many fun activities in the work schedule. They also allow employees to come with pets in the workplace which values the employees and hence increases their motivation level. The core values of the company help the employees to give their best efforts and enjoy the work they are doing (Google.com 2017).
Google are also concerned about the stakeholders related to the environment and are actively engaged in corporate social responsibility. They give one day off for the employees so that they can fulfil their duties towards the poor and persons in need in the society (Google.com 2017). They are engaged in volunteering work and offer deserving people an opportunity to transform their lives.
The company takes care of the products of the competitors since advertising is the primary source of revenue generation (Haucap and Heimeshoff 2014). This process is not only beneficial for the competitors however it is useful for the customers as well. When customers visit the advertisements in the search engine of Google, then they are getting acquainted with those products which is helpful for the concerned companies (Haucap and Heimeshoff 2014). This also increases the revenue generation of the company.
Google considers the investors as one of the most important groups which is affecting the success rates of the CSR activities (Peifer 2014). Google has excellent research and development strategies that contribute to the holistic approach of the firm in increasing their value before the investors. The investors are important as they determine the capital availability of the firm which is being used by the company. The R& D department aims to deliver useful products that are considered to be profitable (Google.com 2017).
Balance between privacy and profitability-Google
I believe that it is possible to respect the privacy of the users while trying to maintain profitability ratio of Google. The business model of Google ensures that the revenues which is earned by the company is gained by the advertising process by the marketers. This also makes it sure that the company is able to provide free services to the users. The private data of the users is required for the purpose of targeted marketing and advertising (Tucker 2014). Google increases its revenue generation in a variety of ways and there are times when the privacy of user’s data has been utilized for this purpose. The company should take a thoughtful process in selecting the nature of websites that would be included in the advertisements in the search engine page. It should exclude some websites which would make it more secure and it would also help the company to gain the trust of the company. The business ethics is one of the most important domains of the organizations (Crane and Matten 2016).
Google has initialized default encryption in their search engine (Jueneman et al. 2015). This implies that the company would encrypt all the search sessions of the users and every person who has signed in Google website. This implies that no third party can view the private information being entered by the users and also the information which is being sent back to the user. The search results are getting more personalized and hence there are high chances of hacking of the information.
Google do respect the privacy of the employees and only certain amount of information is being used for the purpose of advertisement (Jueneman et al. 2015). This is done for the purpose of service improvements as well as increase in the revenue generation of the company (Haucap and Heimeshoff 2014). The company has also included this component in the privacy statement which states that some of the user personal information would be used by the company (Lazer et al. 2014). There is no doubt that Google is an ethical company and hence the users need not worry about the security breach of every information they share on this website (Jueneman et al. 2015). This is because of the fact that Google has been awarded as the one of the world’s most ethical organizations by Ethisphere Institute list, which is also awarded for excellent corporate citizenship (Hoover and Pepper 2015). This has been done by the transparent business practices and its commitment to the ethical principles.
The company should try to strike a balance between protecting the user information and maintaining the company profitability. It should emphasis more on the protection of the personal information while finding alternative ways of revenue generation. It is true that almost 96 % of Google’s revenues comes through the advertising channel (Google.com 2017). It uses Adsense and Adwords to show relevant advertisements to the customers while they are looking for a specific term in the search engine (Alhlou Asif and Fettman 2016.). The income statement of Google says that 70% of the company’s revenues is derived from Adwords and the rest of the revenues is derived from Adsense (Google.com 2017). This implies that the “cost per click” model brings more revenues to the company. In this model, the advertiser would get payment only when the customers would click on the advertisement. However, Adsense works on the principle that the other website owners are able to join Google and they successfully display the branded ads of Google. The company should focus more on Adsense since this mode offers limited security breach of the personal information of the users. The adoption of this model would help the company to increase their profitability while maintaining the privacy of the information entered by the users.
The company must focus on data privacy and educate the users accordingly. It should shift its default site to a secure server. It should not only be done for the “logged in” users but should be implemented for all the users using the search engine. There should be more protection for the Google.com searches. Google should spread the word that if anyone is eager to receive the referrer data then they should make a conscious effort of shifting to a server that gives high security (Google.com 2017). There should be better protection measures while maintaining the good relations between publishers and the search engines (Caroll Archie and Ann 2012). It should use the blocking mechanism to filter the referrers related to search items, which would be helpful for the publishers and at the same time, protect its users also. This would be coupled with sourcing out alternate revenue channels of the company which would increase its profitability.
Effects of government regulations on Google’s operations
The Government has made certain legislations for the internet companies which determine the way to collect personal information and the usage of such sensitive information (Plantin et al. 2016). Google also need to follow the country specific legislations depending on their nature of business activities in the particular geographical area (Jueneman et al. 2015). There can be different legislations in different countries, which should be followed by Google, if it wishes perform its business operations in that region. China Government has stringent rules towards the internet operations and hence the company had to modify its business operations accordingly (Lee Liu and Li 2013).
The company has always abided by the rules and regulations of the government (Google.com 2017). They have also adjusted their privacy statements so that they can comply with the rules of the government. Google have to adapt to the new legislations by making changes in their business operations. The government regulations include the laws, legislations and the different statues which regulate the tracking as well as collection of user data by the internet service providers (Koske et al. 2014). The government has strictly penalized the tracking of personal data and also specifies the nature of data that can be collected by the different companies.
The corporate giants are constantly in the pressure of different stakeholders either directly or indirectly. The pressure can be due to greater emphasis on the profits or the pressure on ethical business practices (Bsr.org 2017). The companies are also presented with pressure on the performances. The different kinds of pressure often correspond with the moral as well as ethical responsibilities of the organizations (Bsr.org 2017). The companies often engage in unethical means of getting higher profits, which has led the government to devise strict legislations in order to curb these practices.
Google has been involved in lot of controversies such as entering into the markets of China where there are strict internet regulations. It has also initiated the act of tracking the user’s online surfing habits as well as smartphone habits, which puts a big question on data privacy and security (Lupton 2015). This has made the Government to order them for draw a line between the violation of user privacy and the generation of revenue (Mondal et al. 2014). This has made the company to modify its business operations. It has started offering internet services to the general public at free of cost as the company is able to generate the targeted advertisement modes (Google.com 2017). It has started looking at the privacy issue from a different perspective and has incorporated more transparency in the operations. It also ensures that the rights of the stakeholders would be respected. The company may start to look for new business opportunities due to the implementation of the government legislations, which would imply additional expenditure for the company. It should try to restore the trust of the customers, so that they can continue to be one of the most popular search engines. It cannot afford loss of users which can adversely affect the business revenues.
There are instances when the open access regulations have caused less investments in the internet organizations. The Government is also promoting net neutrality and thus regulating the internet. This may affect the revenue generation of Google as it may no longer be able to track the user data (Google.com 2017). It should give an option that would gather user consent regarding recording of the private information. There should also be an option which would allow the users to opt out of the tracking process. There are instances of reduced revenue generation as the advertising tool “Adwords” would be heavily affected by it, which is the primary revenue generation model of the company. However, the company should must make dedicated efforts to combat with these issues.
The business ethics is one of the most important aspects of the multinational organizations. It successfully managed to understand the privacy issues of Google. It has helped to understand and how it would manage to create balance between profitability and the privacy issues. The concluding part discusses the effects of the government legislations on the operations of Google. The report discusses the future changes in the business operations due to implementation of new business regulations. This report would broaden the understanding of the ethical issues of business and the corporate responsibility of the multinational corporations like Google.
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