Background
General Electric (GE) Company was established in 1892 as a financial service and advanced technological corporation. Initially, the aim of GE Company was to manufacture products and offer services that were primarily used in the transport sector. During this time, the company served only the North American market. Currently headquartered in Fairfield, Connecticut in the USA, General Electric Company is now a financial service and diversified technological company. The firm is currently manufacturing products ranging from household appliances to aviation products besides offering financial services. The company majorly deals in aircraft engine production, production of household appliances, power generation, consumer and business financing as well as the production of business and industrial items (General Electric, 2011).
Situation analysis
The company products and operation processes
Since its incorporation, the company has expanded into the energy sector to include the development and implementation of strategies that have led to the improvement of technologies and products that are utilized and applied in the exploitation of resources required in the production of energy. The resources include gas, wind, solar, oil and water. Basically, the energy infrastructure developed by the company offers services and products directly or indirectly. These are utilized in energy production, distribution as well as management. The energy produced is consumed by industries, households, and governments (General Electric, 2011).
The energy sector comprises the renewable and non-renewable energy product portfolios. Products and services that the company offers in the renewable portfolios include solar panels and wind turbines. Further, the company offers nuclear reactor facilities that include generators and turbines. In a non-renewable energy portfolio, the company supplies gas and oil equipment as well as other supplies used in oil drilling, pipeline compression, and equipment used in the inspection of liquefied natural gas (General Electric, 2011).
In the transport sector, the company offers products used in rail, oil and gas transport, mining and transit industries. Other products found within the transport solution sector are provided through power generation and marine industries (General Electric, 2011). The services within this sector include remote monitoring and diagnostic, locomotive enhancement and repair services. The company also develops media infrastructures used in diversified media sectors such as media entertainment, marketing production, information, and sports content.
In the financial segment, the company has developed a capital business that provides financial services to its consumers. The financial services consist of guaranteed credit, charters and numerous other monetary services including funds for equipment, resources for firms, distributors and clients.
Marketing strategies
For the company to expand its commercial activities there was a need to align customer requirements with those of the sales force. With increased competition and pressure from globalization, the company needed to come up with a marketing strategy that was capable of serving global customers. The marketing strategy must focus on excellence and should be capable of driving the sales force towards excellence (General Electric, 2011). The company has to adopt the vertical selling strategy that accommodates and supports the five main sectors including its health, financial, energy, retail, and transport. These vertical alignments have yielded huge gains for the company. The benefits from the alignments of the five sectors offerings have been approximated to be over $200 billion in profits (Harris, Kuivalainen & Stoyanova, 2012). The strategy, besides its huge gains, has also been found to be better in establishing good relations with the company clients.
The better relationships developed have resulted in a unique assortment of competencies which include information, products, financial services. Efforts to enhance its marketing have prompted the company to collaborate with companies that deal with their products to support and assist in advancing the company’s operations (General Electric, 2011). For instance, the company collaborated with Xerox in order to improve their marketing operations. Such a relationship is aimed at providing the company with operation and financing capabilities as well as with the intention of improving their marketing strategies.
The company has also incorporated globalization in its marketing strategy. With an aim of becoming the global organization or a multinational, the company must expand its marketing scope to enable the corporation to become a multinational. As a result, the company has employed a huge number of foreigners not as a source of cheap labor but with the aim of bringing in the product innovations from their own countries (General Electric, 2011). Further, this huge workforce is expected to market the company’s products in their own countries which in effect enhance the global marketing strategy of the company.
With the adoption of global marketing strategy and attainment of multinational level of operation, the company is positioned to achieve economies of scale in all its production and marketing activities. Once this possibility was attained, the company produced in large scale which made it possible for GE to save its finances that were invested in other areas purposely to improve the company’s image and brands (Paul, 2011).
The company advertisements and promotion
The organization advertises and promotes its products and services at the company imaginative site. A variety of products of the company are inspired by imagination. The advertisements show how people are being inspired by the company’s products through positive and insightful campaigns. Other technologies used in the promotion of GE products and services include print, radios and televisions. The advertisements are available at the company website. The promotion main focus is to enhance health standards. In marketing its products, the firm puts emphasis on the use of television, radio, print and online adverts.
Investing aggressively in overseas expansion
Basically, General Electric Corporation aggressively invested in foreign expansion; it also dubbed globalization mainly after the corporation had noticed that a lot more existed in the foreign lands. In fact, GE appreciated that more could be reaped overseas in excess to merely shipping commodities to far-off states. Hill (2008) asserts that to the General Electric Corporation, the call for investing in globalization was made a bit easier through upholding its commitments to warrant its marketplace affiliations and potentials that are needed to be successful in such foreign countries, are sufficiently strong for this corporation to make its investments (General Electric, 1914).
General Electric saw numerous opportunities that could be exploited. For instance, Welch, the Chief Executive Officer of GE Corp. noticed that with such an aggressive investment, the weaker points looming in the European Economy between the financial years 1989 and 1995 could be viably exploited. Welch indeed utilized that opportunity by taking advantage and investing in the European marketplace an amount equivalent to $17.50 billion.
Relocating headquarters
Corporations that try to relocate their global business headquarters to overseas localities have a lot of things they would want to accomplish. In essence, General Electric would have opted to relocate its headquarters to such countries because when this corporation acquired the Latin America globalization, the nature of economic volatility and unpredictability became worse after the Mexican Peso collapsed. Between the financial years 1997 and 1998, the Asian currency also went into turmoil after this country had gone into financial crisis. When this occurred, General Electric Corp felt that it was much easier to exploit the prevailing opportunities in most Asian economies as well as in Japan (Hill, 2008). In reality, GE Company finally stood a better chance of attaining approximately forty percent of its total proceeds from universal trades which made the corporation to record an overall increment of twenty percent from the fiscal 1985. Therefore, some of the key reasons why General Electric Corp decided to operate globally included acquiring economy of scale, reducing its budgets, increasing its market share as well as sales (Snow, McKenzie & Kurtz, 2010).
When GE moved some of its headquarters from the US, it implied that the company was just trying to run off the slow-moving United States domestic expenditure. This helped GE turn more of its headquarters to focus away from a particular locality to foreign countries which could in turn assist General Electric Corp in getting hold of its increasing product demands. The prevailing United States economic condition seems to be very unpredictable. This makes it meaningful for Multinational Corporations to reallocate most of their operational headquarters to various other prospective global parts (Hill, 2008).
The GE Company has moreover the sole opportunity to utilize the increased revenue advantage of the Asian economies dynamism. This made it considerably easy to relocate most of the jet-engine headquarters from the United States to countries such as China and India which are perceived as the major jet-engine products buyers. Furthermore, when assessed against the United States marketplace, the Indian and Chinese Asian markets have vast infrastructural investments majorly in the power stations, railways and airports. Given such market advantage, the fiscal 2012 saw financial analysts claiming that General Electric Corporation stands a chance of generating global business between 55% and 60.0%. Thus, this is assumed as an approach for attaining an actual global or multinational corporation image (General Electric, 2011).
General Electric additionally relocated the United States healthcare headquarter to United Kingdom. In the financial year 2008, the gas and oil equipment headquarter was transferred to Italy while the General Electric Corporation Money headquarter was relocated to London. The main idea for relocating most of the GE headquarters was purposely to remain into close contact with its product consumers and clients (Hill, 2011). These moves by GE were beneficial to the United States since the company was able to retain its clients, increase profitability margin and expand on its global market share. For example, when London had GE money headquarter, the corporation managed to go very close to most of the Asian and European clients. Basically, the relocations were somehow reasonable in the sense that General Electric managed to increase its proceeds via increasing income or revenues accruing from the developing economies (General Electric, 2011). Hence, the newly pursued moves will further benefit the United States simply in form of the ensuing novel ideas and new equipment designs.
Internationalizing senior management ranks
Whilst General Electric internationalizes the senior management, it appears that the corporation tries to be culture sensitive. As a matter of fact, the corporation has realized that while it hires managers who deeply and simply comprehend the local languages as well as managers having strong work ethics, working within the localized foreign markets might be much easier (Snow, McKenzie & Kurtz, 2010). Most GE headquarters have been shifted to the Midwest where most of the inhabitants are expatriates or emigrants. Such people have strong work ethics which would definitely make it a bit undemanding for GE to penetrate the overseas marketplaces. When higher ranks are internationalized, it implies that countryside managers who come from the locality where the corporation is situated are hired to run the company (Conglomerates, 2011). This initiative normally helps multinational corporations to succeed.
Compared to other occasions when the GE top ranks were simply managed by Americans, internationalizing requires that the corporation must leave some top jobs that would be filled by foreign countries managers. These managers must come from the country where GE has invested. For example, when investing in China, GE is obliged to leave some slots that Chinese managers will fill. This will help the corporation to proficiently and successfully work jointly with the local Chinese people as well as the Chinese government. Through such an approach, GE will aptly achieve cultural sensitivity touch that might have not been realized with American managers (General Electric, 2011).
GE as true global business
For any corporation to realize an actual universal image, it becomes essential to make certain that cooperation with the clients are at a closer range. This implies that each corporation will have to assess its universal marketplace share in order to identify localities that give promising and ever-increasing products and service markets (Hill, 2011). Subsequent to relocating their headquarters to such locations, corporations should ensure that esteemed clients are provided with satisfying and quality services. Besides, such penetrations can only be realized by employing and working closely with local managers. These managers will sensitize the company on issues related to culture (General Electric, 2011). Therefore, it is deemed imperative that a corporation must closely work with its clients since overseas products’ shipment is hardly enough to gain market dominance.
References
Conglomerates, (2011). General electric company. Web.
General Electric (1914). General electric company review. New York, NY: General Electric Company.
General Electric, (2011). Imagination at work. Web.
Harris, S. Kuivalainen, O. & Stoyanova, V. (2012). International business: new challenges, new forms, new perspectives. New York, NY: Palgrave Macmillan.
Hill, C. (2011). International business: Competing in the global marketplace. New York, NY: Irwin/McGraw-Hill.
Hill, C. (2008). International business. New York, USA: McGraw Hill.
Paul, J. (2011). International business. New Delhi, India: PHI Learning Pvt. Ltd.
Snow, K., McKenzie, H., & Kurtz, L., (2010). Contemporary marketing. USA, Washington: Nelson Education.