Companies looking to get into new markets typically run the clichéd ‘buy, build or partner’ calculus on how to get the highest return on the lowest investment. Invariably, the answer is ‘yes’ to all of the options, as significant strategic moves require broad efforts to take the company in new directions.
Consider the case of Google and its still-emerging Apps business. (Like so much at the search engine company, there seems to be a ‘beta’ tag hanging on this division.) It has inked three deals for both technology and a sales channel, unleashed hundreds of engineers on the would-be ‘Office killer’ and, just recently, put together a distribution deal with Salesforce.com.
And yet, Apps still isn’t where Google needs it to be. Even more of a concern is that, in our opinion, the moves aren’t even enough to get Google Apps in a position to begin to challenge Microsoft Office. Google needs something more. In the end, a successful partnership isn’t simply about access. It’s about efficacy. In order for Google to control the Salesforce.com distribution channel, it has to control Salesforce.com. Read full report.