General Electric after GE Capital Harvard Case Solution & Analysis

Problem Diagnosis

This case highlights the origin of GE since the inception of the company and also how the company became the largest corporation in the world under the leadership of Jack Welch. The chosen successor of Welch is Jeff Immelt and after becoming the CEO of the company, Immelt has been facing a number of different challenges such as the effects of the 2008 financial crisis and also the 9/11 terrorist attacks.

As a result, the stock price of GE had plummeted and it has been lower as compared to the stock market recovery. Therefore, the current strategy employed by Immelt is to focus more on the industrial engineering at GE. Furthermore, Immelt has also been selling the financial assets and ultimately, GE’s capital, which has been the financial arm of General Electric and this is generating huge cash for the business. Now the main problem faced by Immet is to decide where to invest the cash generated from the sale of the GE capital and what should be the next course of action for the company.

Case Analysis

We begin the analysis of the case with the identification of the resources, capabilities and the core competencies of the company. These are discussed in bullet points one by one below:

Resources, Capabilities and Core Competencies

Through the identification and discussion of the resources, capabilities and the core competencies of the company, we would be examining the internal environment of the company.

General Electric after GE Capital Harvard Case Solution & Analysis

 

Resources

  • There are different categories in which, the resources of the company could be divided such as tangible, intangible, human resources, etc.
  • The financial strength of the company is huge and one of the businesses identified from the case is the GE capital, which is the financial arm of the company and it supports all the other businesses of the company.
  • GE capital had generated around half of the total revenues for the company in the year 2001.
  • GE capital had developed rapidly under the leadership of Jack Welch, who provided the required input during the late 20th
  • The company also has strong physical resources. For instance, GE has a global presence and has set up offices all over the world. For instance, some of the departments of the company were also repositioned under the leadership of Immet. X-Ray departments were setup in China and the equipment produced by China was used in US.
  • The company has also strongly pursued the ‘company to company’ strategy such as the collaboration with the French government and this has strengthened the resource base of the company.
  • Reverse innovation is another important resource of the company through which the company has been developing products that match the characteristics of the emerging markets by providing them with some cheap healthcare devices. Later these were then brought to developed economies such as US.
  • Technology is another important resource of the company and an important part of the GE culture. This could be seen by the large number of the acquisitions made by Welch of the technology companies.
  • Immelt had pioneered innovation at GE and a high portion of the revenues was invested back in the research and development at the company.
  • The brand image of the company is strong which is based on high customer value, innovation, customer retention, numeric system and the integrated systems...................

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