Page 138 - NITI - Navigating Indian Traditions in Industry

encompassing approach to innovation and resource allocation. Instead, Alphabet’s
model allowed for more flexible, tailored investment in different areas. Each unit
under Alphabet could pursue aggressive innovation in its field without worrying about
affecting the profitability of Google’s core operations.

For example, Waymo could focus on research and development in autonomous
vehicles without having to worry about immediate profits, whereas Google could
continue investing heavily in its advertising and search engine dominance. Viyog’s
principle of separating different areas allows businesses to allocate resources where
they are most effective and viable.

4. Creating Flexibility and Scalability:
This strategic separation also allowed Google to create a scalable organizational
structure. Each entity could operate autonomously, grow at its own pace, and adapt
to market changes independently, ensuring better long-term success.
The strategic move to Alphabet echoes Viyog, where a company or organization does
not need to force all components to exist under one umbrella but can instead scale
and innovate in each area independently, allowing for quicker pivots and adaptability.

5. Divesting from Non-Core Markets:
Another example of Viyog in action is seen in Google’s divestment of non-core
ventures. As part of Alphabet, several non-strategic businesses, such as Google Glass
and Nest Labs, were either sold off, shut down, or operated more independently. This
allowed the company to retreat from underperforming or misaligned markets and
focus its energies on profitable and strategic areas.
The separation enabled a more targeted approach, where Alphabet could focus on
profitable core areas like Google Search and YouTube, while other projects could be
managed more flexibly without impacting the parent company.

6. Exploring New, High-Growth Markets:
Viyog’s principle also encourages exploring new market opportunities, and
Alphabet’s creation enabled Google to expand into different sectors without being
constrained by its previous business model. For instance, Calico, a life sciences
company focused on aging and disease, was separated under the Alphabet umbrella,
allowing for substantial investment into this high-risk, high-reward sector. This move
reflects a withdrawal from areas that were more mature (such as advertising) to focus
on potentially disruptive, innovative fields.

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