Google has become the most used search engine in the world, in 2010 it accounted for over 66% of the use of internet search engines.1
China, a developing nation2, has flourished as a global web user. Internet users grew from 23 million in 2000 to 103 million in 2005, an increase of 447% in just five years. See Exhibit 1.
Tom MacLean, Google’s director of International Business, saw an opportunity to invest in the Chinese Market 3, and then subsequently moved forward with Google China. We believe that the major driver for the development of Google China was revenue and growth.
When conducting business abroad, managers must respect and embrace: local governments’ restrictions, culture and beliefs. We are dealing with ethics, business opportunity, and loyalty to a firm’s code in this brief.
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We agree with the following:”Regardless of the parent’s firm size, each subsidiary is a local company that must comply with the laws in the country in which it is located.”8 This is exactly what Google’s executives did; we fully support their decision on censoring information even if this meant betraying their motto.
Google’s decision in entering China was in the best interest of shareholders. Google was losing its market and it needed to re-invent its functionality for Chinese users.9 In order to retain and perhaps regain its market, Google needed to accept the requests from the Chinese government.
Form of government is one of the political forces that are deemed uncontrollable to managers – as stated in Chapter 1. Google adapted and managed its main controllable force - people; it hired Dr. Lee, a Chinese citizen, who searched for local talent in universities.
Google China provided useful information to Chinese users – to some extent; the public’s reaction to Google’s decision brings the term “Ethnocentrism”10 to our minds. As Dr. Lee stated: “Chinese government, good and stable, that’s a good form of government”.
International business entails many factors that business leaders must be aware of. In China, Google saw the opportunity of a growing market and it diverted from its motto and stated mission.
Google’s actions draw criticism from the North American public. However, we applaud Google’s decision on taking a chance, business is about taking risks. As International Business Managers, we have to realize that customs, cultures, and government differ among nations; it is our task to embrace and make the most out of them.
Our thoughts and conclusions are based on the fact that we are not dealing with a private business – we are dealing with a large corporation that has to conduct their business oriented to satisfy a greater audience than ourselves – we have to satisfy the stockholders.