How Google became the most valuable business in the world

By the middle of 2010, it was clear that something was broken at Google.

Investors, analysts and members of the media who once touted the company’s fast growth started to wonder if Google was just a “one-trick pony” that cleaned up Internet searches and made a nice advertising business out of it.

Inside Google, teams had begun moving forward with a wide range of groundbreaking and potentially lucrative projects to dominate the smartphone market, scan millions of print books, map every street in the world and even build cars that would drive themselves. 

Google’s problem wasn’t a lack of ambition, but rather a fundamentally flawed decision-making process at the very top of the company that kept slowing things down, according those in the C-suite at the time. 

For nearly a decade, Google’s two brilliant youthful founders, Larry Page and Sergey Brin, made all major business decisions together with the seasoned executive they had selected as CEO, Eric Schmidt.

“They were so close at the beginning of the company and they made so many great decisions together. It was very powerful,” Patrick Pichette, Google’s former chief financial officer, said in an interview this week with Mashable. “But as the company grew and grew in complexity and momentum, that became an issue.”

The vexing issue, and Google’s eventual fix for it, set in motion a more “mature” management strategy that helped it move faster, eventually influenced its move to create a new holding company called Alphabet and arguably propelled it (however briefly) to overtake Apple this year as the most valuable business in the world

Looking back, Google’s flaw was obvious, but serves as a case study for the need to consistently re-think the leadership structure of businesses as they grow and adjust their goals.

Google’s leadership triumvirate in 2009.

2.5 hour long debates

As CFO, Pichette enjoyed a rare birds-eye view into Google’s exclusive and influential executive suite from 2008 until he left last year to travel the world and find better work/life balance

From that perch, Pichette watched as this triumvirate at Google unintentionally created a massive bottleneck simply because they believed all three men needed to be in the same place at the same time deciding on the same things. 

On multiple occasions, Pichette says, product teams would wait eagerly for the executives to emerge with a decision after some “2.5 hour” long debate — all three are prone to intellectual sparring — only to be crestfallen to learn that no decision had been made because Page or Brin or Schmidt happened to be somewhere else at the time, necessitating yet another debate.

“No decision was made without the three of them being in the room and all nodding,” Pichette recalls. “I can tell you at some point this created such a slowdown in momentum.”