What we can learn from Google and Craigslist

Recently I heard a remark that demonstrates the "I refuse to learn anything new that doesn't agree with what I already know" paradigm infecting many traditional media companies.  I was making a point about new business practices, specifically Google's, and was met with the response, "Well, you're using the exception to the rule, there's only one Google."

The obvious weakness in that remark is that it signals that following the herd is somehow wise, and studying the cutting edge of success is a waste of time, because Google is just lucky.

Both Google and Craigslist (Amazon too) offer many lessons in new business management practices worth our attention and study.  Jeff Jarvis and Umair Haque provide many posts more in depth than this one.  My intention is to encourage you to pay attention and understand what these companies have done that is replicable in your own organization.

For starters, both companies have cultivated company cultures that transcend making a quick buck.  That certainly goes against the grain of contemporary business mindsets that are focused on the short term and really don't have a philosophy that extends beyond profitability and forcing new sales growth.  The main thrust of Google's and Craigslist's success has been their investment and allegiance to the customer, particularly the consumer.  Google also encourages employees to expand and experiment and facilitates it—OMG, actually make mistakes.  Their consistent investment into education of their employees and customers is nothing short of trail blazing.

In the case of Google, there are many search engines and as a matter of fact Google wasn't even the first.  So, there have to be reasons why they emerged as the leader.  Could those reasons be inherent in their culture, their strategies, their management practices, their fiscal management?

Here is a snapshot of their financial performance over the past four years drawn from their 10-K SEC filings (thanks to my friend Ken Norton for doing the tedious work of inputting a blinding array of numbers.  Some assumptions were made in account classifications).

Click on image to enlarge.

This is a breakout of the numbers in table format for download or open in new window.   Download Google FSB Tren…table 04-07

Indeed, Google is fortunate to combine getting it right on so many fronts, any of which they could have failed on.  I don't think it's luck.  It's systematic hard work and exploiting opportunities that were available to competitors, but somehow Google had the foresight to act on them.  No doubt they will have failures as they go.  That's part of the journey—part of learning.

Same for Craigslist.  I've been fascinated with Craig's life philosophy that guides the business.  That philosophy seems to be shared by the small number of managers and employees that work with him.

A new chapter for business management is being written.  Study it while it's in process.

Comments

[Jeff Jarvis]

Pardon the horribly blantant book plug but that is what I try to say in What Would Google Do? -- that there need not be one Google but that we all have lessons to learn by trying to see the world through its lens.