GEs Corporate Strategy

Analyzing GE’s corporate-level strategy from 2001 – present with Jeff Immelt as CEO, GE focuses on the growth and development platforms. Technology is the key driving force for GE’s future and growth. Advancements in industries such as energy, health and aviation fueled demand for cleaner and more efficient energy production. GE identified new markets with potential high-growth that offered attractive returns through strategic mergers and acquisitions. As CEO, Jeff Immelt established a process for identifying projects that offered attractive growth potential which were then nurtured and treated as special projects or initiatives that were not subject to strict budget constraints. Immelt introduced GE’s three strategic imperatives as: (1) sustaining its strong business model, (2) strengthening the business portfolio, and (3) driving its growth initiatives. www.ge.com

GE Healthcare is a unit of the wider General Electric Company. It has a global orientation, employing more than 46, 000 staff committed to serving healthcare professionals and patients in over 100 countries. It is headquartered in the United Kingdom (UK)-the first GE business segment outside the United States. It has a turnover of approximately $ 17 billion. The headquarters hosts GE healthcare corporate offices as well as finance, sales, global sourcing departments, X-Ray marketing, manufacturing, design and shipping. The finance and sales departments at the headquarters handle GE Healthcare’s high level decisions, but each modality often has its own similar

Strategy refers to the plan or action taken to achieve organizational goals. When Ellen took over Tufts-NEMC, the hospital was struggling with payroll and scale. Ellen had to focus on meeting payroll, a short-term strategy, and could not focus entirely on the longer term. She took some immediate measures to help cut cost

The board not only selects and works with the CEO’s but it sustains its relationships over time.

Economies of scale and scope help producers lower their cost by producing the next unit of output at lower costs this trend continues until production reaches a level of diseconomies of scale where production is no longer running as efficient as it should. This tends to increase the barriers to entry for new competitors as when they enter the market they will experience a higher cost of production. Why? Solely because they have smaller economies of scale and cannot afford to sell the product at the same price as other much larger firms. Generally, economies of scale and scope positively affect General Electric. Since General Electric is one of the biggest conglomerates in the world it has the opportunity to offer products and services through the same organization. These products might be highly unalike but due to the wide range of businesses covered by GE the prospect is there. For example, GE, in order to continue a healthy relationship with valued customers, has allowed the multimillion dollar purchase of its jet engines to be financed over long periods of time. The catch is that these finance opportunities are usually done via a leasing arrangement from GE Finance. In recent year GE has pursued a service strategy when it comes to selling aircraft engines. They sell what they call “power by the hour” this enables the private firm to indirectly rent the engine turbines, in return the firm would award GE with maintenance contracts on the engines. This

A new kind of financial investment in the North American markets (Sapp, 2010, p. 4)

Also; Citigroup, Inc. another competitor for the GE Company made a total of $64.95 billion in 2011, and when we compare it with GE and SI its earnings where even less in the same year, making General Electric a leader in the industry. With this valuable information GE management can analyze its competitor’s financial statements results and from there they can evaluate their faults and create new ways to increase their annuals earnings and secure their place as one of leading companies in their industry. Another way GE can go forward in the industry is by adapting its services and products to other countries that need them.

In the recent past, the trend in the flow of foreign investors in the United States has been overwhelming. Notably, the numbers of foreign holdings have indicated a consistent desire to purchase stocks and bonds. For instance, external investors own at least 20% of the stocks and 43% of the bonds in the United States stock market. In 2015, the American stock market reached a peak in its investors trust and confidence. The U.S. economy has gained credibility and admiration across the world. It has remained competitive and

When Reg Jones, Welch’ Predecessor, became CEO in 1973, the company organization was just completed to be centralized, but Jones could not able to keep up with reviewing massive volume of information generated by 43 strategic plans. Finally in 1977, he capped GE’s departments, divisions, groups, and SBUs with a new organizational layer called “sectors”, which represented macrobusiness agglomerations.

Welch has shepherded a corporate entity comprised of several diverse lines of businesses that became the ”Most respected company in the world.” according to the Financial Times. Will GE be able to sustain the success that it has realized during the past twenty years under Welch as the acting CEO once he departs?

Analysis - GE has likely been so successful over the years because of its ability to foresee major trends and capitalize upon them. In the 1960s, for instance, GE was one of the eight major computer companies. Even recently, since 1986, GE has continued to acquire several organizations; portions of NBC, wind manufacturing, universe pictures, aerospace industries, international firms, software and hardware manufacturing, even oil companies abroad. The company culture describes itself as not one company, but many each unit a vast and complex enterprise in and of itself, with a corporate

* Strategy exists in the mind of the leader in the form of a vision of the organization’s future.

Finally under the leadership of CEO Jeffrey Immelt, GE has adopted aggressive growth goals, and it believes that entering via joint ventures into nations where it lacks a presence is the only way of attaining these goals. Fueled by the large number of joint ventures, GE has rapidly expanded its international presence over the past decade. For the first time, in 2007 the company derived the majority of its revenues from foreign operations.

This report talks about the successful strategies adopted by GE that was accountable for its success. It will start by answering the question the importance of studying GE recent globalization strategies and practices, and then, by giving a quick background of the company globalization process evolution. After that, the report will demonstrate a close analysis to 4 main strategies of the company. Finally a conclusion will be given based upon the current challenges and future perspective.

Johnson, Wittington, Scholes, Angwin and Regnér (2014, p. 3) defines strategy as ‘the long-term direction of an organisation’.