Nadler–Tushman Congruence Model: Google Analysis

Introduction to the Congruence Model

The congruence model as put forth by Nadler and Tushman (1980) suggests that organizations need to have a particular degree of consistency and fit among twelve components in order to achieve success in their strategies. They define congruence as how well the various components within an organization fit together. This means that for any organization, the components that contribute to the effectiveness of the model need to be of high quality in order to fit well with one another. The congruence model suggests that inputs for the organization must match outputs through an efficient transformation process and feedback loop. These four major categories encompass the twelve components of the model. The organization chosen for this analysis is Google, which meets the inclusion criteria of having more than 25 employees.

Organizational Inputs: History, Environment, Resources, and Strategy

Organizational History

Organizational history is defined as the period of time that the organization has been in existence, combined with the major historical events that have shaped the organization into what it currently is. It also includes the key leaders within the organization and the decisions they made that led the organization to become what it is today. Any crises that arose and that the company managed to survive are also an integral part of the organization's history (Hellriegel, Slocum, & Slocum, 2010).

Since its inception in the mid-1990s, two individuals have been integral to the success of Google: its founders, Larry Page and Sergey Brin. The two started Google with a vision to provide open access to information to people all over the world, and it is this vision that has made Google what it is today. The founders have also faced criticism from many observers regarding their approach to business. Critics have argued that Google's business sense is unusual, because though the company has managed to be profitable year after year, it seems to operate strictly by the book. The concern among critics is that the organization's management is "too right," which does not match what other large organizations have had to do in order to succeed. Many organizations of comparable size have had to craft aggressive or questionable strategies in order to remain at the top of their industry. The founders responded to this criticism by stating that their objective has always been to create and maintain trust from their consumers. Their unofficial business mantra — "don't be evil" — supports the attitude the founders have maintained since the company's inception. What the Google founders have demonstrated is that it is possible for an organization to succeed without compromising its ethics.

Organizational Environment

Organizational environment is defined as the internal and external demands and constraints that an organization faces. It also includes the opportunities for growth that the market presents, alongside factors such as clientele, contracts, competition, and market trends. The external environment further includes the general performance of the economy, regulations, political interference, and special interest groups that influence the organization's strategy and performance (Piccirillo & Noro, 2008).

Google has always strived to operate with high ethical standards and a "no evil" philosophy, with its core values consistently at the helm of the organization. Google is currently the leader in search, which provides many opportunities for growth. Additionally, search engine advertising and targeting represent a growing market that allows Google to offer more services to its consumers. The company is also expanding into more countries; though it has offices in more than 50 countries, it still has significant growth potential as the most popular search engine in over 120 countries worldwide.

Google also offers other services that have become integrated into consumers' daily lives, such as desktop search incorporated into most Linux-based operating systems. Google's mobile operating system, Android, has also grown in popularity, becoming the most widely used mobile operating system. Google has entered into many formal partnerships with mobile manufacturers, which presents further growth opportunities. Business analysts have also argued that Google is "recession-proof," given that its highly targeted advertising services offer companies hit by economic downturns an effective way to reach consumers. This presents an opportunity for Google to continue growing regardless of broader economic performance.

Organizational Resources

Organizational resources are defined as the financial inputs, human resources, information, knowledge, and goods and services that a company provides to its consumers (Thompson, 2001).

Google has a healthy and growing financial base. The company's annual revenue surpassed the $50 billion mark for the first time in 2012, with 99% of that revenue generated by its search advertising service, as most of Google's products and services are free to use. The company's growth ratios, activity ratios, and profit ratios all indicate a financially stable organization expected to remain so for many years. The company also has a high liability-to-assets ratio, suggesting that debt management is being handled appropriately.

Google also holds many patents, which protect its intellectual properties. These patents allow the company to keep its complex algorithms proprietary and prevent competitors from releasing similar products, effectively giving Google a dominant position in services such as PageRank. However, since patents expire after a set period of time, Google may face competitive challenges upon their expiry.

Another important resource is Google's strong brand name. Over the years, Google has built a brand so widely recognized that the verb "google" has been incorporated into the dictionary. Much of the company's growth and success stems from this global name recognition and the reputation that precedes it in every market it enters.

Strategy

Strategy is defined as the tactics and plans that an organization and its management develop in order to survive and prosper in both the long and short term. These are the goals and objectives of the organization, and they represent the means through which the organization matches its resources to the environment in which it operates.

For Google, the primary strategy is grounded in innovation. A major aspect of Google's success is what may be described as "systematic innovation" — the company creates an enabling environment in which employees are encouraged to question the status quo and identify ways to improve it (Bessant & Tidd, 2011). This process involves constant brainstorming and unconventional thinking. Google encourages its employees to make use of its state-of-the-art gym and leisure facilities during working hours, embracing a work-hard, play-hard culture designed to stimulate creativity.

Throughputs: Tasks, Formal and Informal Organization, and Individuals

Technology and Tasks

The technology and tasks component requires balance. For the organization to succeed, it must be able to use available tools and techniques to develop efficient processes that produce innovative products and services for its consumers. Specialty services and consultants are important in this regard, as they help foster innovation within the organization (Grundy & Brown, 2002).

Within Google, the degree of innovation is extremely high, and the company prides itself on a strong culture of innovation. As a result, the company has significantly scaled its infrastructure over the years and diversified its product offerings to reflect this innovative character. The founders and senior management are always looking for new opportunities for innovation or ways to improve existing products. This is also evidenced by the large number of companies Google has acquired over the years in order to incorporate their services into its product portfolio (Tucker, 2009).

Formal Organization System

The formal organizational system includes all written and unwritten operating procedures of the organization, including the departmentalization and grouping of work into functions. It also depicts the formal relationships that exist between groups and major units in the organization and how these are used to coordinate and control performance. Other aspects include rewards and recognition of employees, decision-making processes, HR policies, planning methods, and resource-based motivation of employees (Rosen, 2007).

Informal Organization System

This component refers to the informal arrangements through which the organization operates, including its culture, values, vision, and approaches to conflict resolution and organizational learning. Google has an informal corporate culture that encompasses the "no evil" philosophy alongside other ethical principles. The company offers stock options to employees even at the entry level, which serves as a motivation factor for improved performance. This contributes to Google's ranking as one of the best employers in the world, as recognized by Fortune magazine and Universum. The "no evil" philosophy is considered one of the major values that the company attributes its success to.

Individuals

Individuals within the organization refer to the knowledge and skills that employees need in order to transform inputs into outputs. These include employee commitment, motivation, and the availability of necessary human resources. Google prides itself on an informal work culture where employees are permitted to complete their tasks in their own chosen manner, provided they meet expected performance standards. Teamwork is encouraged, and employees are provided with all necessary tools to collaborate effectively (Mohapatra, 2009). Google also offers personal development opportunities through training programs and formal education support, including scholarships provided by the company.

Conclusion

Google exhibits a high degree of congruence across the six components analyzed: history, environment, resources, technologies and tasks, formal organizational system, and outputs. This high degree of congruence enables the organization to achieve strong performance that is well matched to its inputs and strategy. Over the years, Google has managed to prosper in a highly ethical and moral manner, keeping both shareholders and other stakeholders satisfied. The analysis reveals no major incongruences among the components examined.

References

Bessant, J., & Tidd, J. (2011). Innovation and Entrepreneurship. Wiley.

Grundy, T., & Brown, L. (2002). Strategic Project Management: Creating Organizational Breakthroughs. Thomson Learning.

Hellriegel, D., Slocum, J., & Slocum, J. W. (2010). Organizational Behavior. Cengage South-Western.

Mohapatra, S. (2009). Business Process Automation. Prentice-Hall of India.

Nadler, D. A., & Tushman, M. L. (1980). A model for diagnosing organizational behavior. Organizational Dynamics, 9(2), 35–51.

Piccirillo, E., & Noro, M. G. (2008). Guidebook for Supporting Decision Making Under Uncertainties: Today's Managers, Tomorrow's Business. World Scientific.

Rosen, E. (2007). The Culture of Collaboration: Maximizing Time, Talent and Tools to Create Value in the Global Economy. Red Ape Publishers.

Thompson, J. L. (2001). Understanding Corporate Strategy. Thomson Learning.

Tucker, R. B. (2009). Driving Growth Through Innovation: How Leading Firms Are Transforming Their Futures. Booksurge LLC.