GE Case Study Assignmtnt: Improvement of Communication (Case Study Sample)

GENERAL ELECTRIC (GE) CASE STUDY
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Executive summary
The core competencies of GE include globalization, which involves the formation of acquisitions, alliances, and joint ventures; service strategy, which focuses on the enhancement of the satisfaction of the company’s clients and technology strategy, which is geared towards the improvement of communication, the production of unique products that are hard to imitate and the elimination of non-profitable businesses. Moreover, the company’s innovation strategy as a core competence, on the other hand, aims at equipping the organization with the ability to innovate; hence, ensuring improved growth and customer satisfaction. The company tends to concentrate more on the threats, as well as the opportunities inherent in its external environment such as cultural, social, technological, environmental, and political trends. GE can drive its future growth through investing in high-tech and web-enabled technologies, as well as forming alliances to reduce the company’s investments required to develop new products. Welch used a leadership style that focused on speed and efficiency at the expense of the customer. Immelt, on the contrary, concentrates more on GE’s public image and its long-term stability. Moreover, unlike Welch who concentrated more on the management of the company’s share price, Immelt puts more focus on managing the firm for long-term growth in profits. Additionally, Immelt has implemented a number of measures to ensure that the company relates well with all its stakeholders including its customers, governments, communities, and suppliers, unlike Welch who overlooked them. In this era of globalization, it can easily be argued that the management style of Immelt is better than that of Welch.
Table of Contents1.0 TOC \o "1-3" \h \z \u Introduction42.0 An internal Analysis of Core Competencies and Capabilities of GE52.1 Globalization PAGEREF _Toc458249299 \h 52.2 Service Strategy PAGEREF _Toc458249300 \h 62.3 Investment in Technology PAGEREF _Toc458249301 \h 62.4 Innovation Strategy PAGEREF _Toc458249302 \h 7 2.5 Using Kaplan’s Balanced Scorecard to show how strategy could be monitored and evaluated at GE…………………………………………………………………………………..8 3.0 An external Analysis of GE94.0 Strategic Options for GE105.0 Comparing and Contrasting Welch’s and Immelt’s Management styles PAGEREF _Toc458249307 \h 126.0 Conclusion PAGEREF _Toc458249309 \h 147.0 References15
1 introduction
General Electric (GE) is widely considered as the world’s most successful corporation of the 20th century. This company is involved in a broad spectrum of production areas including, but not limited to, aircraft engine, healthcare equipment, appliances and NBC television network. GE traces its roots to the traditional power industry. The firm was created in the year 1892 following a merger between Edison General Electric Company and the Thomson-Houston Company. These two firms were, however, involved in a rigorous competition before their merger. Immediately after the merger, the company opted for Edison’s greatest ideas, the fact that Edison had decided to stay out notwithstanding (Magee, 2009; Pearce and Robinson, 2009).
The research laboratory established by the company in the year 1900 in Schenectady, New York, is to date regarded as the main force behind the impressive innovations produced over the years. GE was originally involved in the manufacture of power-industry related devices such as electric lamps, generators, motors and alternators. In 1912, it began the manufacture of vacuum tubes for use in radios and x-ray machines. The production of the magnetron was started by the firm in 1919 (Springer, 1973). In the 1940’s, the company started diversifying its areas of specialization further, and this saw it begin the manufacture of electric locomotives such as the electric train. Devices which the company began manufacturing in the 1900s and are still being manufactured today include stoves, irons, air conditioners, washing machines, radios and televisions. The firm is presently regarded as the largest manufacturer of military, as well as commercial jet aircraft engines (Joseph and Ocasio, 2012).
Currently, GE has numerous research and manufacturing outlets spread across the globe, two television networks, and various other businesses. This paper seeks to utilize academic models to identify GE’s core competencies and capabilities, and discuss their effectiveness in supporting the corporation’s success up to date. Additionally, the paper will outline and discuss two strategic options for GE over the next five years and make appropriate recommendations. Lastly, Jeff Immelt’s management approach will be compared and contrasted to that of his predecessor Jack Welch.
2.0 An internal Analysis of the Core Competencies and Capabilities of General Electric
General Electric has made use of a couple of strategies over the years in efforts to actualize its mission. Moreover, the strategies have enabled GE to adjust accordingly to the changes caused by various factors characterizing the firm’s external environment. The core competencies as identified by Immelt (2002) include an effective communication, which is facilitated by the company’s simple organizational structure. Additionally, the firm has five segments located in different regions whose mandate is to deal with technology infrastructure and capital finance. Moreover, GE has numerous products in its business segments. The company’s policies ensure that it engages in practices which are pertinent to the immediate opportunities. Finally, this firm is known to have administrators who treat the implementation of its policies with the seriousness it deserves (Joseph and Ocasio, 2012). The following internal approaches are lauded as GE’s core competencies
2.1 Globalization
GE has a very elaborate globalization strategy that involves the formation of acquisitions, alliances, and joint ventures. Immelt (2002) posits that, GE, in an effort to restructure its business portfolio, decided to concentrate more on new growth platforms targeting the business ventures that it had already ventured into (Ashkenas, DeMonaco, and Francis, 2000). As such, the company has over the years engaged in the establishment of acquisitions whose impact has been a tremendous value addition. In the healthcare arena, for instance, GE has come up with acquisitions such as Amersham, a UK based firm that deals in medical equipment and diagnostics, Abbot Diagnostics, which is arguably the words top brand in in-vitro diagnostics, and HPSC, which deals in dental practices. Others acquisitions include Enron, BHA group, ChevronTexaco’s coal business, and Astropower which are in the business field (Immelt, 2002).
2.2 Service Strategy
The leaders of this company appreciate the fact that, customer satisfaction is key to the success of any company. As such, the company has over the years engaged in practices which improve the fulfillment of its clients. For instance, GE has invested in technologies that enhance customer performance. This move has appealed to many people, thereby making the company the biggest infrastructure firm in the world (Wilson, 2000).
2.3 Investment in Technology
For a company to succeed in developing core competencies, the integration of diverse technologies comes in handy. Moreover, the need to ensure the harmonization of diverse production approaches is vital. To know the specific core competencies of a firm, a number of considerations are done. To begin with, a firm must be capable of gaining access to a wide variety of markets (Wilson, 2000; Taylor, 1995). For the case of General Electric, its former CEO Welch formulated the firm’s business portfolio through the choice to move away from non-profitable business ventures and instead offered more profitable services (Bock, 2001). Immelt (2002) asserts that, for GE to sustain its earnings growth, it chose to combine various business segments.
2.4 Innovation Strategy
GE’s innovation strategy is also considered a key pillar of its success. Immelt (2002) argues that the firm’s innovation strategy is characterized by a total of four features. The first of these features is the management innovation whose inventor is Jack Welch. In coming up with this feature, Welch was motivated by the need to reduce the levels of the organization’s structure as too many levels occasioned a distortion of information. Following the introduction of this feature, enhanced performance was registered as individuals were able to get a direct access to vital information. The second feature is that of product innovation which necessitated a continuous development of value-added products. The third feature, on the other hand, targets equipping the organization with the ability to innovate. Here, the firm ...