Financial Analysis - Google & Microsoft



Financial Analysis - Google & Microsoft

Core Businesses

Google

Way back in 1996, Stanford University graduate students Larry Page and Sergey Brin built a search engine called “BackRub” that used links to determine the importance of individual web pages which led to www.google.com in 1998. Since then, it is the world's most widely used search engine. This paper evaluates the performance of Google and provides a comprehensive financial analysis of the company. Moreover, it also analyzes the competitive environment of the industry, the trends of the critical financial indicator and present recommendations whether or not to invest in company's shares.

Google is a technology company focused on providing web search and advertising. The company maintains a large index of web sites and other online content, which are freely available through its search engine. It generates revenue primarily by delivering online advertisements. Google operates in the US, the UK and a large number of other countries. The company offers a broad portfolio of web based products and services which are classified into six categories: Google.com; applications; client; Google GEO; Android and Google Mobile; Google Checkout; and Google Labs. Google is the company's core offering (Google, 2010).

Microsoft

Microsoft Corporation is a multinational software company with approximately 93,000 employees' worldwide and annual sales of 69.94 billion U.S. dollars. It is headquartered in Redmond, a suburb of Seattle (U.S. state of Washington). Since 2000, Steve Ballmer is the Chief Executive Officer (CEO). The company is known for its operating system Windows and its Office software Office. It was founded on 4 April, 1975 Bill Gates and Paul Allen. The firm represents Microsoft microcomputer software, originally Micro-soft. After initial success with a BASIC - Interpreter in the late 1970s the company in 1981, had an operating system MS-DOS which presented its development on behalf of IBM. The IBM PC and its clones on PC based in the 1980s were primarily concerned with this DOS equipped operating system. In the 1990s, the graphical operating system Windows and Microsoft Office software Office were the market leaders (Microsoft, 2010).

Leadership/Management Style

The leadership style at Google is mix. Leaders at Google are practicing transformational leadership provoke a conviction among employees in their beliefs and an absolute obedience to orders. In addition, they also stimulate emotional involvement on the part of the follower for the missions and a feeling that they can contribute greatly in the accomplishment of the mission. Transformational leadership is a two-way process that influences both the leaders and their followers. As a consequence, transformational leadership increases the level of self-awareness and pushes employees to outperform themselves and thus, leads to organizational transformation. Transformational leadership can be developed through training. This is an important form the management perspective as they can develop capable employees to become leaders of tomorrow (Nguyen & Mohamed, 2011).

Since transformational leadership is directly related to efficiency and job satisfaction in the followers, which stems from effectiveness on the part of both employees and the leaders it has a great impact on ...