Business 101 Lessons: Google vs. China’s Censors, Cybercriminals

 

January 13, 2010

So Google is finally paying attention to a free-enterprise business compass. In other words, the search engine is threatening to extract itself from China over censorship and cybercrime issues. Because it’s a huge marketplace, Google and other companies have been tolerant of such problems.

Actually, tolerating an uncontrollable, hostile environment violates principles in best-practices management. So it’s a tardy development, but let’s roll out the welcome mat.

After President Nixon bridged the diplomatic gap between the U.S. and China in 1972, companies and nations have tolerated and perhaps even encouraged China’s behavior – censorship, violation of human rights, intellectual-proprietary thefts, currency manipulation for cheap exports, other discriminatory-protectionism policies, and Communist Party activities.

In 2006, I wrote that I was disappointed by the decisions of Internet companies that decided to acquiesce to China’s behavior and environment. It’s one thing to accept it, but another to condone it and build a business model around it.

My reasons:

• Values matter
• The free-enterprise system works best
• Economic and political freedoms are connected – lose one and you lose the other

Business Leadership

To be a business leader, it’s important to know who you are…what your roots are…plan strategically…and always try to do the right thing – even if your decisions and actions are unpopular.

Actually, this principle applies to all facets of life and even sports. And I love writing sports metaphors for business topics.

For example, many Seattle Seahawks’ fans were delighted with the selection of Pete Carroll as coach, especially, after his initial press conference upon being hired away from the University of Southern California. That was when he explained why he was previously unsuccessful in the NFL. By any standard, he was dominant in his tenure at USC.

Before coaching at USC, his pro football teams – the New York Jets and New England Patriots – were mediocre. It was refreshing when he admitted in Seattle that he didn’t know himself or who he was in his earlier pro jobs.

In referring to his new team he made this comment: “When we start this thing off, they’re going to know where I’m coming from, because I know where I’m coming from.”

One of his Seattle predecessors, Cleveland Browns executive Mike Holmgren, had success as coach of the Seahawks and Green Bay Packers. But he was unsuccessful his first four years in Seattle because he was both coach and general manager. It was only after the management responsibilities were taken from him that he coached the team to the Super Bowl in 2005. During that time, I speculated that his lack of success stemmed from the Peter Principle. In essence, people rise to their level of incompetence.

Few people are equipped to handle both responsibilities. Even if they have all the technical and management skills, their attention to detail, energy and efficiency will plummet.

So possibly, the Google brain trust needed to learn about themselves and the downsides from conducting business while abandoning their values.

Socrates was right

Ancient Greek philosopher Socrates is known for his aphorism: “Know thyself.” And it’s right out of my human resources training materials.

For individuals, a complete self-assessment of strengths and weaknesses is the key to success. Once an employee knows who she or he is, then it’s possible to effectively set goals. Then, execution comes into play.

For success in business, an analysis of strengths, weaknesses, opportunities and threats will pave the way for writing a productive strategic plan and a business plan. And again, it’s important to execute.

Google’s courage will help other businesses to fully realize about the problems associated with foregoing their values in order to do business in China. Certainly, it will be a catalyst for discussion.

Google believes its security was violated by hackers based in China. But there is probably another motivation.

The search giant has relatively little to lose unlike companies such as General Motors. China is a profit source for GM. Depending on your preferred source of information, Google’s search market share ranges from less than 20 percent to 35 percent. But it isn’t enjoying bountiful profits because e-commerce is not as big in China as the rest of the world.

Here is Google’s explanation  of its new perspective.

Let’s hope others are paying attention.

From the Coach’s Corner, what is your profit forecast this year?

Here is a top-10 checklist for profits:  

1. Review and fine-tune your business plan. Be sure to discern your competitive landscape and benchmark your main competitors.
2. Bring on the A team – both in staff and advisors. Recruitment and training will remain important, and seek the best mentors and professionals for inspiration to help you sustain growth.
3. Remember Pareto’s Principle – the 80/20 rule – that applies to you and your business in a variety of ways. It means, for example, that 80 percent of your revenue comes from 20 percent of your customers. So evaluate how you spend your time and resources.
4. Enhance your staying power by concentrating on your most profitable customers while identifying new revenue sources.
5. In prospecting and marketing, select and target the right customers.
6. Add sizzle by improving your niche-performance. Uniqueness will count even more in this year.
7. Watch your cash flow and your firm’s overall budget each week.
8. Focus on quality in your business processes – make it your No. 1 job.
9. Innovate – plan for more marketplace changes and evolving consumer preferences.
10. Practice the art of mental toughness. Remember when it’s appropriate to ignore the opinions of others, and to persevere in your dreams against seemingly insurmountable odds. I’m still marveling at the success of my mother, who is in her eighties. She was diagnosed with macular degeneration, which meant she couldn’t read the newspaper. A couple of years ago, she had life-threatening complications from back surgery. A few weeks later, she was back in intensive care and doctors warned she wouldn’t walk again. Well, guess what? She’s walking, passed her driver’s test, and once again insists on preparing full-course meals, especially at family gatherings.  Mmm, delicious! Go mom!