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Analysis of General Electric Essay


Initial Challenges

During his first four years in as CEO, Jeff Immelt had to contend with reduced investor confidence resulting from the 9/11 terrorist attack. Investors’ confidence in the stock market was shaken which resulted in a 20% reduction in General Electric’s stock price.

Immelt had to reduce the company’s annual growth forecast which was earlier set at 18% annually, by previous CEO, Jack Welch. Immelt made some changes to the company’s strategy by diversifying its operations to help it take advantage of new opportunities in the global market.

The firm needed to improve its competitive advantage in technology and service sectors, to help it increase its market share in high value industries (Bartlett 2). Under Immelt’s leadership, GE improved its external commercial functions which strengthened its competitive edge in the market.

Changes in Strategy

Immelt needed to maintain General Electric’s strong financial performance in the market, similar to what Jack Welsh had achieved in his tenure. One of his major acquisitions, Vivendi made it possible for General Electric to have a strategic market share in the media industry. GE also acquired Amersham, a health technology firm to enable it take advantage of the health industry’s long term shift to biotechnology.

These strategic decisions diversified GE’s commercial activities which made the firm well prepared to take advantage of future changes in the global market (Bartlett 8). Therefore, this made GE’s internal operations to be driven by creativity and innovation.

Immelt also hired highly qualified marketing professionals to increase sale volumes and to establish strong relations between the firm and its customers. Immelt helped GE to diversify its operations into different high value segments which were dominant in their respective markets.

Core Market Competences

The acquisitions of Vivendi and Amersham helped GE to introduce new products into the market which strengthened its performance. These acquisitions became part of GE’s core market competence because they created a shift in the company’s commercial focus. Vivendi enabled GE to have a new portfolio to drive its long term positive growth because the acquisition increased its market share in the media industry.

Amersham made it possible for GE to take advantage of lucrative opportunities in the biomedical industry. Moreover, new operations in energy, water services and security enabled the firm to strengthen its position in the market.

Immelt’s leadership helped GE to add value to its market operations by focusing on lucrative product segments. This set a strong foundation for the firm to achieve long term growth. Therefore, GE has benefited from a new growth strategy driven by its renewed focus to produce high quality products and services (Bartlett 10-12).

Immelt’s leadership has enabled GE to diversify its operations to take advantage of new opportunities in the global market. GE’s management teams recognize new market trends and changing consumer needs easily.This new approach has diversified the firm’s earnings because of a strong emphasis on innovation, increased customer value and globalization.

GE’s shift to the service industry made it have a more aggressive approach to the market because it was serving diverse clients with different needs and expectations. The firm has managed to cut operating costs by reducing expenditure on functions that do not bring positive returns (Bartlett 13-16). Immelt has enabled the company to extend its operations into new frontiers and this will help GE have a positive long term profit outlook.

Works Cited

Bartlett, Christopher A. “GE’s Growth Strategy: The Immelt Initiative.” Harvard Business School Case Study (2013): 1-21. Print.

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Carroll, S. (2019, December 12). Analysis of General Electric [Blog post]. Retrieved from https://ivypanda.com/essays/analysis-of-general-electric-essay/

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Carroll, Sasha. "Analysis of General Electric." IvyPanda, 12 Dec. 2019, ivypanda.com/essays/analysis-of-general-electric-essay/.

1. Sasha Carroll. "Analysis of General Electric." IvyPanda (blog), December 12, 2019. https://ivypanda.com/essays/analysis-of-general-electric-essay/.


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Carroll, Sasha. "Analysis of General Electric." IvyPanda (blog), December 12, 2019. https://ivypanda.com/essays/analysis-of-general-electric-essay/.

References

Carroll, Sasha. 2019. "Analysis of General Electric." IvyPanda (blog), December 12, 2019. https://ivypanda.com/essays/analysis-of-general-electric-essay/.

References

Carroll, S. (2019) 'Analysis of General Electric'. IvyPanda, 12 December.

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