Although Kathy's written countless academic articles on the subject and strategy and competing in ultra-fast industries, she's not a professor in the Business School at Stanford, but in the Department of Industrial Engineering and Engineering Management.
In 1998, she gave a talk at Columbia about a new book she co-authored with her doctoral student at the time. The book was called Competing on the Edge: Strategy as Structured Chaos. The co-author was Shona Brown. Today, Brown is the senior vice president of business operations at Google (GOOG)
So, who is Shona Brown? Like most people at Google, she's brilliant by normal standards. The Canadian, who majored in computer science at college, was selected as a Rhodes Scholar. She decided that she wanted to work with Kathy Eisenhardt at Stanford in the mid-1990s and graduated with a PhD in strategy and organization from the Engineering School.
At Stanford, with Einsenhardt who was well-known and well-regarded by tech companies in the Valley, she got involved in many interesting side consulting engagements. Instead of opting for the academic path after graduation, she decided to pursue consulting. She went on to be a management consultant at McKinsey & Company in Toronto, where she worked with Patrick Pichette, who -- like her -- was also a Rhodes Scholar and was working at McKinsey at the time Brown joined. He would later go on to become an executive at Canada's largest phone company, Bell Canada.
At McKinsey, Brown began working with Google and its senior executives and founders on the ideas discussed in her book. To boil the book down, the co-authors discuss how companies, especially tech companies, seem to do better when they strike the right balance between organizational structure (clear roles/processes) and entrepreneurial dynamism (eg, reacting to some instant news in the market or environment instead of being too bureaucratic to react).
Eisenhardt often uses Google as an example of a company that "gets it right" in finding that Goldilocks balance between too much and too little organizational structure when she discusses the book.
With her star rising at McKinsey, Brown transferred to the Los Angeles office and began working more and more with California clients. She also led the firm's global strategy practice.
In 2003 -- one year before Google went public - Shona Brown was convinced by Google's co-founders to join the company as a senior executive. She oversees the "People Operations and Business Operations" groups at Google. In practice, her job is to ensure that Google finds the balance in the area in which she got a PhD: the balance between too much and too little organizational structure.
With Eric Schmidt's departure from the CEO position announced last week, several have pointed to the company's decision-making as being "increasingly bogged down into a bureaucracy."The Associated Press said: 'The managerial constipation and joint decision-making by the trio
Page told the AP: "My goal is to run Google at the pace and with the soul and passion of a startup. I think I will have time to do that given the way we have split up our responsibilities."
Schmidt concurred: "I am quite certain that this change will result in faster decision making and better value for the shareholders."
What they both were really saying was that this move is designed to get the organization back to the optimal level that Shona Brown says it should be at. I am not saying Brown was behind Schmidt's departure, but I am very sure she has the confidence of Page (and Brin) and will be better able to enact her ideas now than she was before this transition.
Brown never speaks publicly to the press or shareholders, but her power is quite large within the company. She advocated bringing in Pichette in 2008 and he is now highly regarded on Wall Street. When was the last time a large Silicon Valley company poached a CFO from a Canadian phone company? The hiring would not have happened without Brown's personal relationship. Google's costs have been much better contained since his arrival.
There were also Internet rumors that Brown clashed with former executive Sheryl Sandberg a few years ago before she decamped to become COO of Facebook. Whether they're true or not, we'll never know. But we do know that Brown is still at Google, still in charge of optimizing the company's structure, and now about to get free rein to do everything she suggests to make the company as entrepreneurial as it can be while keeping the benefits of its structure.
With Page as CEO feeling his way in the new role -- especially with the public face demands -- he will increasingly rely on her counsel. Although I was never an Eric Schmidt fan and am unsure that Page will have what it takes to be the kind of CEO Google needs, I am an unabashed believer in Shona Brown.
Page is more likely to be successful than not in the long run, because she will be standing by him.
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