STRATEGIC ANALYSIS OF GENERAL ELECTRIC

Since its establishment in 1892, the company has maintained a reputable financial position by dominating the market and appearing among the world’s most profitable firms as listed by Fortune 500 and Forbes Global 2000. In this report, a strategic analysis of the company’s unit of venture capital and finance is considered. Strategic Position Owing to the rapid growth and development of General Electric, it is clear that the company is utilizing unique generic strategies to streamline its operations. Accordingly, it has been found that General Electric specializes in differentiation and cost leadership to improve the value of its products hence attracting more customers (Ocasio and Joseph, 2008). A structural analysis of its operations indicated that the firm has been actively engaged in marketing research thus enabling it to narrow the scope of customers’ demands to simple business units.

Since General Electric adequately understands this principle, the company continues to design flexible credit options and financial savings plans thus maintaining its customers while also expanding its market reach. The strategic business unit (SBU) of General Electric is based on a comprehensive evaluation of competition and marketing techniques. The company uses the targeting strategy to understand both demographic and psychographic variants of its buyers (Kownatzki et al, 2013). As a result, General Electric has managed to successfully launch and operate a venture capital business in a market which is already filled with renowned financial institutions. Through market segmentation, the company achieves simple analytics of its customers’ need hence allowing for customization of services to suit the specific descriptions. In particular, it is stated that GE Capital’s operations are sustained by integrating its activities with GE Capital Aviation Services, Healthcare and GE Energy.

From this mode of operation, it can be seen that General Electric has a self-sustaining model whereby its business units are coexisting by supporting each other (Demil and Lecocq, 2010). Therefore, it can be mentioned that one of the significant resources of GE Capital is derived from the other independent business units. It is also stated that General Electric sold most of its subsidiaries as a way of restructuring its operations. While launching these plans, the company acquired enough capital for improving the value of its reduced venture. From the structural analysis of General Electric, it was determined that the company has adequate business communication plans which are also utilized by the executives to achieve all three aspects. The company is also adopting digital methods of business communication such as video conferencing, social media campaigns and web 2.

The model also indicates that companies need to maintain sustainable ethical practices as well as a representation of global and cultural effectiveness. Being a multinational company, General Electric has strived to showcase its consideration of business ethics and honor of local traditions by employing marginalized groups as well as initiating welfare programs. From the model, it can be observed that a company can achieve consistency in its activities through focused leadership and competent human resource management (Demil and Lecocq, 2010). Otherwise, a highly restrictive financial system can only scare away borrowers for fear of being frustrated due to any slight default. In order to properly understand a value system in a company’s structure, Porter’s generic value chain can be used. Fig 1. Showing Porter’s Value Chain Model According to this model, it is advisable to evaluate operations at the firm level as well as the industry level.

A firm-level analysis is helpful in determining whether a company is capable of supplying a particular commodity having considered its available resources. The aspects of marketing and sale are helpful in this value chain because they assist the company to link up with customers and other firms which provide similar services (Solaimani and Bouwman, 2012). Lastly, services are also important characteristics of primary activities because they help in managing the process at the company level and industry level. On the other hand, the components of support activities include; firstly, the company’s infrastructure such as quality assurance or strategic management which are essential monitoring operations to be within scope. Secondly, technological developments which can be incorporated in the firm to facilitate secure and fast transactions. It is also important to acquire a competent human resource manager who can hire and train staff.

For instance, General Electric has managed to successfully invest in the finance industry by introducing low lending rates because its revenues are subsequently generated from the large-scale operations. Additionally, the company’s generic strategies enable it to engage in risky ventures where competition is minimal. The dogs represent an even market where the rates of market returns are relatively low due to the slow growth in the industry. The amounts of revenue generated in such a trading scenario are barely enough to sustain operations but companies still strive to create job opportunities and promote social developments. In general, markets in this position are not profitable to business owners even though they maintain societal welfare. Most of its new ventures like the 3D printing seem to advance quite well because the brand is well known and accepted in the market.

The firm is only required to prove its capability by providing high-value services that satisfy customer’s demands. Stars represent a high market share in a rapidly growing industry. Here, the market has an increasing trajectory while a company is also projected to generate higher revenue (Thompson et al 2008). These situations may gradually favor a single business entity to achieve a status of monopoly. On the other hand, the diversification phase represents a scenario where a company is introducing new products in a new market. As a result, it can be a challenge to make sales where a company is not known. Even though General Electric is introducing new products like 3D Printing, Venture Capital and Finance, the company’s brand is reputable. Therefore, it cannot be greatly affected by a backlash in sales volume.

Market penetration implies that a business is trying to increase its sales volume of the same commodity in the same market (Haq, Wong and Jackson, 2008). This decision has actually favored the company by positioning it at a competitive advantage than its rivals. Accordingly, for purposes of future strategic development, it can be recommended that General Electric needs to venture in consumable products because the company has a reputable brand. In addition, GE Capital can expand its operations to offer micro-finance services like banking. References Bak, O. The role of qualitative research in a mixed methods study-assessing the e-business enabled transformation in a strategic business unit. Haq, F. Wong, H. Y. and Jackson, J. March. Floyd, S. W. and Lechner, C. Corporate control and the speed of strategic business unit decision making.

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