Fortune Magazine had a writeup about Google being disorganized in how it’s run because it’s had only one hit - Search.  Here’s some parts of the Fortune article that I find telling, and I’ll comment on it when feel the need to:

"…..Take the case of Sheryl Sandberg, a 37-year-old vice president whose fiefdom includes the company’s automated advertising system. Sandberg recently committed an error that cost Google several million dollars — "Bad decision, moved too quickly, no controls in place, wasted some money," is all she’ll say about it — and when she realized the magnitude of her mistake, she walked across the street to inform Larry Page, Google’s co-founder and unofficial thought leader. "God, I feel really bad about this," Sandberg told Page, who accepted her apology. But as she turned to leave, Page said something that surprised her. "I’m so glad you made this mistake," he said. "Because I want to run a company where we are moving too quickly and doing too much, not being too cautious and doing too little. If we don’t have any of these mistakes, we’re just not taking enough risk."

I can see his point - Google wants to be in two places at the same time ….. an established company / Brand that is a top stock to own …..AND … a mover and shaker outside of the Established way of doing things, as I mentioned in another post today called "Change comes, almost always, from the outside".   It’s that "tension" between the established leader in Search and the willingness to almost - throw it away, that makes Google an unusual case.  No doubt, eventually, Google will have to buckle down, it’s only a matter of time - but I enjoy seeing them try to do the right thing - and not being afraid of failure.

"……Brown has made a career of arguing that anarchy isn’t such a bad thing — which is why Page, co-founder Sergey Brin, and CEO Eric Schmidt hired her in 2003. A business theoretician in a company dominated by engineers, she considers Google the "ultimate petri dish" for her research, though her job is anything but theoretical. In addition to overseeing human resources (called "people operations"), Brown runs a SWAT team of 25 strategic consultants who are loaned out internally on ten or so projects at a time — restructuring a regional sales force here, guesstimating a market size there."

"……The way to succeed in "fast-paced, ambiguous situations," she tells me, is to avoid creating too much structure, but not to add too little either. In other words, just make it not too hot and not too cold, and you’re done. "

Well, I think that’s correct.  I can tell you from first hand experience that working in large corporations is like getting 10 signitures for any major thing you need.  The problem becomes worse the larger the corporation becomes - until they can take any risks - or innovate much - it’s too hard.  What Google is doing is allowing itself to continue to innovate, which is why it stays ahead.  If they become too corporate - too controlled, they will lose their edge and end up becomeing….well, like the rest of the of blue chip companies that can’t get anything major done without 10 signitures!

But lets face it … Google can only do that because it’s making 10 billion dollars a year…should that income ever fail them.- there will be a shakeout, and a series of huge layoffs and many, many unhappy investors.  Chances are that will happen sometime in the future years to Google -  they can’t keep this pace up forever - eventually they will make a couple too many wrong moves and suddenly that income stream will dry up leaving them with some very tough decisions.

"Nurturing such an off-the-wall culture is a luxury only a company that’s performing stupendously well can afford, and Google is certainly doing that. Two years after going public, its stock is up more than fourfold, and it’s so profitable that despite helter-skelter spending on everything from mammoth data centers to worldwide sales and engineering offices, Google is generating more than $800 million in cash each quarter. In the process, Google is thrashing the competition — in market share, deals won, buzz — notably Yahoo (Charts) and Microsoft (Charts). It’s also cozying up to a growing list of heavyweights you’d think would be warier, including News Corp (Charts)., Viacom (Charts), and ad-agency giant WPP (Charts). "

"…….What concerns investors is whether Google can come up with a second act. There’s nothing to suggest that its growth engine — ad-supported search — is in trouble. But it’s clear from Google’s tentative lurches into new forms of advertising and its spaghetti method of product development (toss against wall, see if sticks) that the company is searching for ways to grow beyond that well-run core. It’s the reason, for example, that Google requires all engineers to spend 20% of their time pursuing their own ideas. Successful second acts are exceedingly rare in the technology business — or in any business, for that matter. Microsoft followed Windows with Office. Intel jettisoned its memory-chip line to rule microprocessors. Even Apple, which executed one of the most remarkable rebirths ever with the iPod, had to go through a painful decade to get there."

"….For all its new products — depending on how you count, Google has released at least 83 full-fledged and test-stage products — none has altered the Web landscape the way Google.com did. Additions like the photo site Picasa, Google Finance, and Google Blog Search belie Google’s ardent claim that it doesn’t do me-too products. Often new services lack a stunningly obvious feature. Users of Google’s new online spreadsheet program, for instance, initially couldn’t print their documents. The calendar product doesn’t allow for synchronization with Microsoft Outlook, a necessity for corporate users. "

The article equates "Search" with a winning product - but Search is much, much more than a product - that’s why Google can continue.  Search is "a way of being".  Google can screw up a couple hundred times and still remain the leader in Search and make a great profit - Google is not a product, it’s an experience.  That’s why Google defies physics the other corporations its being compared to are bound by.  Is Microsoft Office a "way of being"…I don’t think so.   For that matter, Microsoft has made tons of products that are not that successful, in and of themselves; it’s the main flagship operating system products that make Microsoft it’s money and cement it’s position.   And Search is not only an "experience" it is also, an "operating system".  That’s what Google has done - it has made it’s Search Engine an operating system.

Yes, eventually, Google will have to slow down - it’s in the cards - they can’t keep this up that much longer.

"Other major initiatives like Gmail, instant-messaging, and online mapping, while nifty, haven’t come close to dislodging the market leaders. Much-hyped projects like the comparison-shopping site Froogle (nearly four years in beta and counting) and Google’s video-sharing site have been far less popular than the competition. One of Google’s biggest misses is its social-networking site, Orkut, which is a hit only in Brazil and — as Marissa Mayer, Google’s 31-year-old vice president of search products and user experience, says with an impressively straight face — is "very strong in Iran." Sometimes promising new products are buried so deep within Google’s sites that users can’t find them. "You can only keep so many things in your head," acknowledges CEO Schmidt. "Even if you’re the No. 1 Google supporter, you cannot remember all the products we have."

"……A billionaire at 51, Schmidt cuts the typical Silicon Valley figure of somebody’s successful, but otherwise average, dad. His khakis-and-oxford uniform is standard, as are his wire-frame glasses and Supercuts-inspired hairdo. Schmidt’s doodling, which he’s also done recently for the Google board of directors, tells the story of where he sees Google’s money coming from for years to come. He draws a series of connected clouds representing the history of the computing industry, from mainframes to minicomputers to PCs to today’s mobile devices. The gist of the illustration is that there’s practically no money left to be made in computers, not in hardware or software. The money, instead, is all in Web applications, a trend Schmidt had been predicting since his days as chief technology officer at Sun a decade ago. Users won’t always be traveling to the Web on the PC, which is why he scribbles lines for cellphones, cable set-top boxes, Treos, BlackBerrys, and so on. Schmidt’s most compelling point — and the most visible glimmer of a method to Google’s madness — is the power behind the not-so-secret data centers Google is building, particularly a 30-acre facility in Oregon whose existence he references without provocation. "That massive investment should translate into the ability to build applications that are impossible for our competitors to offer, just because we can handle the scale," says Schmidt. (Microsoft, Yahoo, and IBM, each of which is spending heavily on similar big iron, would beg to differ.) He’s talking about processing-power-sucking Google applications like Gmail and Google Earth — and unannounced products on the drawing board.

So that’s the deal………build an infrastructure powered by Google’s own operating system that will win out over everyone else with it’s zillions of Web 2.0 applications running on Google’s super charged infrastructure that would be impossible for anyone else to afford to build ….and they’re building it now, when the have the money to do it.