Sometime your successful product, dictates your company name. ALPHABET is an example

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Google recent restructuring of the company with a parent company called “Alphabet”, shows it’s really hard to get your company name correct in lot of instances, or sometimes your successful product will dictate the future name.

Technically speaking, Google could have continued using their existing name, but we can see the problems they are getting into.

People mostly associate the term Google to web search, yes Google got a lot of other products like photos, mail, calendar, self-driving cars, etc. But when people say Google it’s all about search. This heavily restricts the company from exploring or introducing new products/offerings in a smooth way.

One option Google could have taken is naming the parent company as Google, and JUST introduce a new name for search ex: Alphabet could have been just for search. But this would have resulted in such a big risk for the company, after all it took so long for the company to make “Google it..” as verb simply meaning “Search for it”. I can’t think of people saying “Alphabet it..”.

This change will also help Google to run each independent products in a very agile way, and make each one of them accountable. This will also help them to acquire or invest in companies/technologies that are not really connected to their core business of search. Example: Nest, Project Wing (drones). I’m expecting “T” for twitter soon. 

Finally, this is my speculation. Every company get’s into some resource war and do whatever it takes to preserve its core employees. They might have reached a point to step up “Sundar Pichai” before losing him.  Sergey and Larry are too young to step down or move away from their baby. The only option for them to do it in a smooth way is to make Sundar Pichai CEO of Google and create an entity bigger than that oversee the full operations. 

Some companies like Microsoft has done extremely well in this area, as it’s very clear the company produces bunch of software and products like Windows, Office, Xbox, Surface etc

Some companies like Google need to do it in a hard way, but it’s inevitable to do it keeping long-term benefits in mind.