Case Study of Google China
When Google decided to create a Google site to cater to the Chinese market, it not only opened its doors to a new set of individuals it also opened its does to legal, cultural and ethical challenges in business.
Among the first hurdles encountered by Google occurred soon after they launched their Chinese language service to China. Operating from the United States, they were immediately met with legal issues as the Chinese government blocked the site from access in China. Although the site was soon after unblocked, a considerable amount of censorship was placed upon the search results of the popular search engine.
The legal challenge was whether Google would adhere to standards of censorship established by the Chinese government despite the democratic belief of freedom to access of information. To be able to operate in China legally there was a need to employ censorship despite the core beliefs of the company. According to Sharleen Sy (2008) adhering to the free-speech restrictions of the Chinese government was part and parcel of the fundamental dilemmas that face western nations when they attempt to enter into a developing country. Google was forced to ask their selves if their presence in the country was worth the compromise. Secondly, culturally there is much that the western Google needed to adjust to, to be able to cater to the market of 100 million Chinese individuals. Perhaps the most critical, was developing a site that was in the Chinese language. Similarly, an adherence to the perspective of socialism, governmental morality and correctness were among the cultural values that Google needed to be sensitive too as they entered the Chinese market (Sy, 2008). Finally, ethically, Google needed to address their dilemma of providing access to all information, unhampered by economic or political drivers. Google needed to weigh in on the benefit of gaining access to a new market by sacrificing the integrity of their service since they needed to conform to government imposed standards of censorship (Grogan and Brett, 2006).
In the case of Google, the Chinese government served as a hurdle for Google in setting up the global business. An obstacle to the global business, the Chinese government’s role was to control the new business and intervene in the commercial activities in an effort to protect the value system imposed by the government (Tam, 2002). For the Google there was a need to reevaluate their strategy toward entering the Chinese market. The apparent hurdle of the issue of censorship was of course among the first operational challenges that needed to address. Censorship not only required additional design elements in the website operations of the Chinese website it also posed an ethical dilemma for a company that championed access to all information. In the end, the company opted to pursue the establishment of their presence in China not only because of the obvious financial opportunities, which at the time was already being pursued by major industry competitors, but also with the drive to provide as much access to information as allowed in the political environment. Secondly, because of the large market potential, there was a need for Google to create a website design that was specific to that market was well as operational systems, such as servers, that were localized to provide the same kind of quality service that people have come to expect from the company. To address these operational challenges, Google’s strategy was to develop a website in the Chinese language was well as establish local operations in the cities of Beijing and Shanghai. In Google’s strategy toward catering to the Chinese market, they bring to the forefront the need to remain sensitive to the cultural and legal values of the market, as well as the need to be able to compromise financial and ethical drivers to be able to successfully manage a responsible business.
Grogan, C. and Brett, J. (2006 Jan 1). Google and the government of China: A case study in cross-cultural negotiations. Harvard Business Review.
Sy, S. (2008). Reexamining you China strategy. Santa Clara University: Markkula Center for Applied Ethics. Retrieved April 19, 2009 from http://www.scu.edu/ethics/practicing/focusareas/business/china.html
Tam, O.K. (2002). Ethical issues in the evolution of corporate governance in China. Journal of Business Ethics, 37, pp. 303-320.
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