Google vs Chinese Government
Google is a cutting edge Silicon Valley based Internet Company; known world wide for being a titan in the internet industry was admired for their ethical business standards and their distinguished and celebrated corporate motto, “Don’t be evil. ” Google had established itself as one of the most visited sites in the world. Google was rapidly expanding as more than half its user traffic came from outside the US. Though Google. com was accessible to Chinese users, there were many issues related to many of Google’s search contents being blocked by Chinese regulations and slow unreliable service.
Realizing the potential for growth in the Chinese market, Google attempted to purchase a minority stake in the Chinese search engine company Baidu. However, Chinese law prohibited Google from holding more than a minority stake in Baidu therefore; the next logical step was to expand its own presence in China. To assist Google with establishing a permanent presence in China, they enlisted the help of world renowned computer scientist Dr. Kai-fu Lee, who was highly regarded in China and in the Chinese high-tech community.
The next step was for Google to negotiate with the Chinese government to allow uncensored access by Chinese citizens to a high-speed Chinese version of the Google search engine. Central Issue: How might Google reach and agreement with the Chinese Government that would allow them to successfully enter the Chinese market? Significant Factors: * Agreeing to Censorship of a “Google. china” search engine could have been viewed as a violation of Google’s famous principle, “Don’t be evil. ” * Current Chinese law prohibited Google from holding more than a minority stake in Baidu. The “Great Wall of China” allows the government to block and censor any information that the Chinese government sees as “unfit. ” * Google needed to place servers in China to improve speed and performance to compete with other Chinese search engines. * Chinese consumers are naturalistic and were less willing to accept foreign brands if a Chinese alternative existed. * China is one of the largest growing economies, therefore losing the Chinese market would damage Google global strategy.
Setting and research facility in China would give Chinese engineers access to Google’s proprietary research technology, create jobs for Chinese citizens, and also prevent “brain drain” of Chinese talent to the US. Recommended Course of Action: The ideal solution is for Google would be to establish operations in China without censorship. The ideal solution for the Chinese government would be to allow Google to establish a Chinese domain to give its citizens access to better technology, but for them to agree to be censored under their regulations.
However, ultimately both parties have a common goal which is to provide the Chinese citizens with high quality and high speed access to information on the internet. The fact that they share a common goal leads me to believe this negotiation has great potential for an integrative agreement that would allow Google and the Chinese government to build a “partnership” where the two parties can reach a goal that would benefit them both.
My recommendation is for the Google negotiations team to prepare themselves by conducting some preliminary strategy planning before initiating negotiation discussions with the Chinese government regarding their regulatory policies on censorship. By first determining their goals for the negotiation for example do they want to the Chinese government to agree to allow them to create a Chinese version of the Google search engine with some sites and information blocked from Chinese citizens or do they want to the government to agree to remove censorship from the existing Google. com domain.
The next factor for success is to have a belief in the validity of the other party’s position. In order to do this they must both understand each other’s position. Google’s position was that China understand how the image of Google in the media and among investors could be seriously damaging financially, if it bends on its philosophy of “Don’t’ be evil” to appease their regulations. The Chinese government’s position was that Google must acknowledge that it cannot expect its corporate philosophy regarding censorship to apply universally to all foreign nations that they choose to do business in.
Next they should focus on relationship building which involves forging trusting relationships which includes understanding and acknowledging both parties objectives. Google’s bottom line objective is to find a resolution that will allow them to hold up their business ethics while being able and support their financial objectives in terms of revenue growth. The main objective for the Chinese government is to provide its citizens and companies with the access to the very best technology, and eventually to achieve technological parity with the US.
Finally the Google negotiations team will need to develop a strategy for creating clear and open communication channels between themselves and the Chinese officials. Frequent in-person (informal and formal settings) meetings on both Chinese and US territory can aide in engaging in more discussion and also help with learning the preferred communication styles and approach for both parties, which eventually leads to more effective communication.
In conclusion to succeed at integrative agreement both parties must be willing to negotiate so that the Chinese government maintains its political power and Google protects is ethical and financial interests while operating in the Chinese market. If the negotiations are successful it could lead to the beginning of a long-term mutually beneficial cooperative relationship between the two parties.