We've sort of become numb in the tech industry when it comes to management shakeups. We're even quick to use the word shakeup - a word that carries a negative connotation - when we describe the series of events that led up to a CEO stepping down or being replaced.
Most recently, it was AMD's Dirk Meyer being pushed out of his corner office. And last year, HP's Mark Hurd stepped down amid a sexual harassment (kind of) scandal, only to be replaced by former SAP CEO Leo Apotheker, who had just been shown the door at SAP earlier in the year.
So when news broke yesterday that Larry Page was moving in to the CEO office at Google, the red flags started to fly everywhere. Were there warning signs that we missed that current CEO Eric Schmidt wasn't cutting it? Is Page, the quieter and more low-profile of Google's co-founders, CEO material? Should the company have looked outside for a replacement if they needed a change at the top?
But if you step back and take a snapshot from the 30,000-foot view, you'll see that this management reorganization - putting Page into that spot at this particular time - is probably good move.
Think about it. The company's core - search and advertising - are humming along, with efforts around mobile helping to drive results. In the call with analysts to discuss earnings yesterday, Jonathan Rosenberg, senior VP of Product Management, said the company spent 2010 enhancing search, search results, search ads and new new ad formats. On the call, Rosenberg said:
At the beginning of the year, we decided to double down on the core. So that is search and search ads, and I think the financial numbers that you guys are seeing today reflect the fact that that was a successful bet. But behind those numbers is a really relentless stream of new features and product innovations... We also doubled down on the ad side of the house... the biggest boost of all came from good old-fashioned ad quality improvements. Q4 was our best quarter in years from a quality standpoint. We launched over 20 updates, which led to gains that were nearly double those that we would normally see in a strong quarter. So although we have been at this for years, we are still finding lots and lots of ways to make ads better.
And then there are areas like Android - which is clearly making a dent in the marketplace, with more than 300,000 phones per day being activated - and YouTube, which saws its revenue double from a year-ago. The strategies are in place and the momentum is strong. The only thing Page has to do there is to make sure that efforts don't get derailed or go stale.
But then there are those areas where Google needs some injections of innovation. The company really hasn't responded to the threat that Facebook is posing - as a social platform, a content distribution channel and as a potential advertising powerhouse. And someone is going to need to take the lead on rolling out Chrome OS and selling the concept behind a browser-only world of computing. It's here where Larry - with some help from his co-founder Brin, who is working with the innovators - will have to shine.
In a post yesterday, Larry Dignan rattled off five challenges facing Page and securing his presence really is a big one. Page has been the quietest of the executive trio in recent years. Schmidt has been the guy who delivers industry keynote speeches or sits down for one-on-one interviews, while Brin has been known to make cameo appearances at big product announcements. Page, for the most part, hasn't been visible.
Obviously, that will have to change and Schmidt said that "Larry is ready" to be CEO - so one should assume that includes all aspects of taking on that title. Clearly, that means the pressure is on for Page. Yet, it has to be better to walk into a job like that when the headlines around the company are mostly centered around things like Android growth, YouTube revenue, enhanced search and new ad formats.
Consider the alternative: for example, the scenario down the road at HP, where old CEO is ousted, new CEO has to go into hiding to avoid an Oracle subpoena, board members get replaced (yesterday) and the company is still trying to figure out how to be a contender in the mobile ecosystem.
Sure, the pressure may be on for Page to deliver - but at least he's taking over a company that's humming right along, not one that seems to be trapped in a firestorm of controversy.