Google verses Microsoft Research Paper Example | Topics and Well Written Essays - 1750 words

Google verses Microsoft - Research Paper Example They offer a variety of IT products that include the operating systems, design of site operations by companies, products that facilitates efficient advertising. The company majorly engages in the provision of search, advertising, operating system platforms, and enterprise services in general. Microsoft on the other hand does not deal so much on different products than those of Google. Microsoft came into existence in the 1980’s with the major object of ensuring that business IT solutions are well effected, it offered the earlier IT services that included the Microsoft office tools which it has kept upgrading till recent. Its latest product is the Bing, which has been developed to counter the Android that is a product provided by the Google incorporation. Microsoft had been divided into five divisions in terms of the product, hence termed as product divisions. They include; Windows and Windows Live Division, Server and Tools, Online Services Division. All the above are engaged in the production and distribution of operating system products including their upgrade components, Microsoft Business Division; this departments is that which is engaged in the actual business operations which ranges from management to marketing, this department is that which fuels the objectives of helping businesses achieve active business solutions. Entertainment and Devices Division takes care of the entertainment sector. This is a major revenue-generating center for Microsoft incorporation and the corporation derives most of its income from this branch of the division. Microsoft employs the Total Quality Management style (TQM) of leadership. This is a management style where the every employee in the organization employs a proactive measure to ensure that the VMO’s of the organizations are met. Total Quality management also involves management by providing services high quality services that can withstand international completion. Google on the contrary employs a sought of beaurcratic management leadership style where a chain of command flows from the CEO downwards (Vise, 2008). Other competitors are Apple, twitter, Face book which are also IT service companies in the industry. Google financial ratios Name Formula 2008 2009 2010 Current Ratio Current Assets/Current liabilities 8.7 10.6 4.1 Return on Asset EBIT/Total Assets 8.4% 5.8% 5.1% Return on equity EBIT/Shareholders Earnings 13% 16% 14.1% Debt ratio Total debt/Equity 8.1% 7.6% 2.1% Fixed asset turnover Inventory/Fixed Assets 32.2 41.2% 21.4% Dividend payout ratio Earnings/Ordinary Shares 1.8% 2.1% 2.7% P/E ratio MPS/EPS 1.18 2.86 3.27 The movements in their financial ratios determine the performance of any company. The ratios as identified above are determines the liquidity of the company, profitability, the long-term prospects, and even the growth of the company. Liquidity on this case is shown by the current ratio. The current ratio shows the value of current assets as compared to the liabi lities of the companies. Google has high progressively increasing current assets ratio. This shows overcapitalization. It therefore means that, Google has invested much on Current assets than they have liability. The impact of this is that the company risks having liquidity problems in the future since the since it does not have an appropriate liquid cash to undertake their day-to-day operations. Profitability ratios are return ratios that depicts the profitability trends of the company. It is normally the wish