Running Head: General Electric Harvard Case Solution & Analysis

Problem Statement

The CEO of General Electric is facing a critical situation regarding the opportunity available in the wind market in India. The government of India has announced to provide financial incentives to the companies willing to invest in power generation especially through wind energy. However, there are reasons that the company left the country due to market complexity and other related challenges.

On the other hand, the wind market is in development phase and GE can completely exploit this opportunity leveraging its technological strength. Therefore, the decision regarding re-entering in the Indian market is quite a concern for him and needs an effective and immediate solution to this problem.

Alternatives

Alternative 1: Consider China as an Option and Stay Divested in India

China is also a market with lots of potential due to its population, which is why it is suggested to derive from the Indian market and focus towards China. The company will be able to invest resources in a potentially strong market. Furthermore, the company can avoid the risk of investing in a highlyvolatile market and avoid the complexities that are present there.

However, the company will lose the opportunity to exploit a highly attractive market as a result the opportunity cost will be lost. Besides that, the company needs to exploit all the possible opportunities as the company is at the stage of growth which means growth opportunities are scarce.

Alternative 2: Use Merger as an Option to re-enter

This option will allow the company to get aware of the local market by sharing resources with the local firm. This can be a cost saving opportunity and the company can structure its long term plans easily. Besides that the company can overcome the issues in establishing a supply chain as it can use the supply chain of the local firm. As a whole the company will be able to adopt localization and can gain instant market share by attracting a strong consumer base.

However, negotiating with a local firm will be challenging as the legal structure does not allow complete merger on an equal basis. Besides that the local companies may demand high investment in return for delivering market knowledge and experience of the local market. On the other hand, companies in the local market may not allow a merger as they do not want to sacrifice their market share and profit margins.

Alternative 3: Re-enter into India Independently

This strategy will allow the company to leverage its technological competitive advantage in the market and will be able to grab complete hold and sole ownership. Besides that the risk is high, but the return will also be high as the company can leverage its expertise and competency in technology to exploit market better than its competitors. The demand is high and the government regulations are also favorable which makes the opportunity attractive.

However, the company will have to bear the initial start-up cost which will be very high and the complexities that are present in this highly volatile market. Besides that the company will have to invest heavily in order to build the supply chain network and also to grab market share, which will be a slow and steady process as the competition is there that will show resistance.

Recommendation

After analyzing the situation, it is recommended to the company to implement the last alternative and re-enter in the Indian market independently and gain sole ownership. However, it is a risky decision and requires initial cost which will be high, but the potential is also very strong that identifies high return on investment. The advantages and disadvantages of this strategy are explained above and the company will be able to initiate around 4000MW capacity in the country in a span of 4 years.

The growth rate of the market is very strong and the market is expected to grow 15%-30% annually, which indicates that the opportunities to exploit the market are huge. The size of the company allows it to leverage these growth opportunities as the company can easily establish its ground leveraging its strength in technology and expertise in wind energy generation.

Running Head GENERAL ELECTRIC Case Solution

Implementation Plan

As of first step the company should invest in building the capacity for manufacturing in the first year and focus towards developing the supply chain network. Through effective research and providing attractive margins to suppliers the company can gain market knowledge and develop a strong supply chain network.The next target is to set the targets to be achieved after two years and practice outsourcing as India is attractive market for outsourcing components manufacturing. In the third year, the company must focus on building strong relationships with the government and the suppliers. In the last year, the company should focus on extending the market share and identifying new opportunities to exploit............

This is just a sample partial case solution. Please place the order on the website to order your own originally done case solution

Other Similar Case Solutions like

Running Head: General Electric

Share This