Inside Google’s innovation factory

30 Jun 2011

In eight years, Google’s Dublin operations have grown to more than 2,200 people. JOHN KENNEDY talks to global ads boss John Herlihy about making big bets on innovation.

They should call it Google sprawl. Or create an app for it. The global internet search and advertising giant used to occupy a single building on Barrow Street, near Dublin’s docklands. But now when I visit Google I’m usually trying to figure out which building I’ve to get to. I always get it wrong.

Earlier this year, it emerged Google had acquired Dublin’s tallest building – the 15-storey Montevetro Building – from REO for €99.5m. It followed this up within days with news it had acquired two buildings that house its EMEA headquarters on Barrow Street. So earlier this week it was a surprise to discover that Google has had to rent another building around the corner on the canal exclusively to house its engineering staff until the Montevetro building is ready.

It’s easy to think that Google’s been around a long time, but really it is only 13 years old and you have to wonder how a company grew from two blokes running around a college campus in 1998 maxing out their credit cards to buy computers to becoming a US$30bn a year giant, employing 26,000 or so people worldwide.

I think back to that lunchtime in 2003 when news hit the airwaves that Google said it was coming to Dublin to create 200 jobs. A year later, excited co-founders Larry Page and Sergey Brin visited their first new overseas operation. Since then, Google in Dublin has grown rapidly to 2,200 or more people.

The man who presided over much of this growth over the last eight years is Limerick native John Herlihy, who before joining Google held senior financial and operational roles at KPMG, Oracle, First Data, Adobe, PeopleSoft and Epiphany.

More to come from Google

According to Herlihy, who heads up its global advertising business and runs the Irish operations, we’ve barely scratched the surface of what’s coming.

The Google innovation engine is firing on all cylinders and, as he sees it, is showing no signs of slowing down. “Why? Well, we’re in the business of taking big bets,” he says with absolute conviction.

“From day one, even if you go back to the founders’ letter, Larry and Sergey talked about how we’re going to invest in things that are at times unusual but we believe are the right things to do. We’re always going to invest in things we believe provide the best long-term benefit even if, at the time, people aren’t quite sure why we’re doing it.”

There are a number of big bets Google is concerned with right now. There’s Android, there’s open computing, there’s Chrome and there’s social media. Herlihy makes a convincing argument for each.

“A number of years ago, we took a bet on Android and it has turned out to be absolutely brilliant. If you look at it today, inside the business it’s a billion-plus dollars in terms of a run-rate business. There are in excess of 300 Android devices out there and more than 400,000 new activations per day.

“This thing’s on fire and that’s something that a couple of years ago people said we were mad to try and do. It goes back to the Google model of thoughtful risk taking, let’s go for this.”

Herlihy once described how innovation at Google is akin to how the Roman legions used to send out scouts. If the scouts didn’t return, the legions didn’t go in that direction.

“Our innovations are based on realistic measures, such as user feedback and hard numbers,” he says, pointing to significant use of analytics to drive the business.

Irish businesses online – or not

One of the things Herlihy is passionate about is how Irish businesses are using the web, and the company recently launched its ‘Getting Irish Businesses Online’ strategy, aimed at tackling the missed opportunities at a time when firms across the land are struggling. While more and more consumers are shopping online, less than 40pc of Irish SMEs have an online presence.

“We just think there’s a tremendous opportunity to help more Irish businesses get online because by doing that they can export business out of the country and drive GDP.

“It goes back to that big bet thing. We want to put the tools in the hands of users and let them partner up with people who will provide the training and the hosting and the know how to have a meaningful impact.

“The firms need to realise that this will help them. The other thing we’ve tried to do is simplify and demystify the web – the technology industry has a tendency to over-complicate things. Quite simply, by embracing the web you can get more customers.”

Cloud computing is another one of those big bets Herlihy says Google has taken.

“The cloud needs to be simpler than people in the IT industry are describing it and our answer is to do it elegantly in a way that will simplify it and make it usable to users and add value to their daily lives.”

Team Google

The key to Google’s rapid growth in Ireland, Herlihy maintains, has been the people it has attracted. “The team is incredibly innovative and try to drive change very quickly. At the end of the day, we’ve a simple maxim: that our customers get more from us next month than they did last month. If we can say that every month, then we are in good shape, and if not, then we’re taking them for granted. Our workforce in Dublin continues to be innovative and to add value to our users,” Herlihy says.

The power of the people in Dublin was reiterated by Google chairman Eric Schmidt who visited the city this week and complemented Dublin on the success it is having in being chosen by companies like Google, Facebook and Zynga for vital global operations.

However, Schmidt astutely noted that, separate from FDI, Irish businesses are falling behind online and one of the core reasons has been poor broadband.

“You are behind on fibre to the home and you guys are late with respect to 4G rollout. France, Germany and the UK are already ahead of Ireland with respect to citizens and businesses connected to the internet. You just need to do it.

“There are many things that the Government can do, but the thing is it is hard to work with telecoms providers to get more broadband. But these are the roads of the future. There are very few things that are better use of your money that serves the citizens of your country.”

Schmidt pointed to a McKinsey study that said for every job lost in the economy another two can be created through investment in broadband.

“The economic benefit is to get Irish businesses global. The flow through is phenomenal; it creates jobs.”

In conclusion, Herlihy reiterates: “The internet is an economic engine – you don’t need to have all the technical knowledge to be successful online. But from a commercial point of view, it is important that Irish businesses don’t just have brochure ware on their websites but are equipped to compete with the best.”

Photo: Google has grown steadily over 13 years to become the world’s biggest internet company. Google global ads vice-president John Herlihy (left) says it has maintained its growth trajectory by taking big bets on areas like the cloud, mobile phones, online video and open standards. Google chairman Eric Schmidt, who was in Dublin this week, says Dublin is a fertile base for further growth

Google figures

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years