General Electric’s Corporate Strategy Harvard Case Solution & Analysis


General Electric’s corporate strategy is somewhat logical and dependable. According to Jeff Immelt, the current CEO, the strategy is defined as the way to create and allocate right mix of resources to the right place at the right time. Over the years, the conglomerate has divested many of the businesses and has invested in many new sectors of the world’s industry.

The reason for divesting in many fields is that these businesses are not performing in-line with the vision of the General Electric and the reason for investing in new ventures is the alignment of both the business’ strategic visions in the same directions. The giants of the business world have been analyzed to have issues such as complications in management and the investors have difficulty in understanding the operational structures of these businesses. However, General Electric is such an excellent organization to analyze that its combined business units are at an advantage than having them as independent separate units.

The previous CEO of the company, Jack Welch, made the corporate strategy in a way that he directed the diverse businesses of the company in order to secure a leading position in their respective industries or dissociate themselves from the company. In order to maintain a competitive edge in the entire industry, he ensured the competitiveness of his business executives. Jack Welch removed the layers of the management and introduced effective concepts to the world industry like Six Sigma that became the benchmark for the world.

In order to ensure effectiveness in the corporate strategy, Jeff Immelt emphasize don bringing collaboration in such a diverse organization. There are seven sectors in which General Electric serves its customers, and the business strategies are set in such an effective way that each individual sector possesses a massive potential to perform independently in an efficient and effective manner.

The five pillars of the strategy of General Electric revolve around these areas to create high profit margins, and capital efficient growth. These pillars are technical leadership, services, customer-focus, growth platform and globalization. These areas are high margin growth areas, which are the evidence of the effectiveness of the corporate strategy.

The CEO wants the corporate strategy to include businesses that bring the entirety of the company in terms of products, services, information and financing so that the company can capitalize on the trends of growth. The corporate strategy is designed in such a way that there is one finance and human resource processes to run the company.

There is one leadership development center and only one global research center to achieve synergies in the businesses. The team of General Electric is so efficient that the company has been able to achieve long lasting value and strives to make the world a better place. The culture of the organization has been developed in line with the expectations of the long term investors.

Jeff Immelt has described the four strategic principles to achieve growth as: Invest in high potential businesses, achieve financial discipline and organic growth and attracting top tier talent.Later in the following years, he described five corporate strategies as a proof of what he states earlier,that the company has adopted in order to grow.General Electric Corporate Strategy Case Solution

These are Re-emergence of General Electric as infrastructure leader;allocation of capital in a balanced way;increase investment in organic growth, focus on research and development and global expansion; build deep customer relationships, and striving hard to become highly productive organization.

The corporate executive council meeting is a depiction of effective corporate strategy that it enables the top tier management members to share insights, best practices, and intelligence about the market, warnings, and technology developments or anything that is considered important so that effectiveness can be brought in the corporate strategy.This is so that the company makes timely decisions to include those businesses, which offers high growth and margins.General Electric’s Corporate Strategy Case Solution

As described earlier, General electric has divested many of the businesses like insurance, entertainment, equipment services, health care IT and consumer credit. This is the evidence of the fact that this business’ vision does not fit with the corporate vision of the company. However, the company does not end here as it acquired many businesses, which it sees as strategic in nature and their mission and vision matched with the corporate mission and vision of General Electric...............

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