A Comprehensive Profile of General Electric, a World-Renowned Corporation
General Electric (GE) is the world's largest diversified services company. From aircraft engines and power generation equipment to financial services, and from medical imaging and television programming to plastics, GE is committed to creating a better life through a wide range of technologies and services. GE operates in more than 100 countries worldwide and employs nearly 300,000 people globally. Jeff Immelt succeeded Jack Welch as GE's Chairman and Chief Executive Officer on 7 September 2001.
GE's history can be traced back to Thomas Edison, who founded the Edison Electric Light Company in 1878. In 1892 the Edison Electric Light Company merged with the Thomson-Houston Electric Company to form General Electric (GE). GE is the only company that has remained on the Dow Jones Industrial Average continuously since the index was established in 1896.
Seven growth engines generate 85% of profits: Consumer Finance, Commercial Finance, Energy, Healthcare, Infrastructure, NBC Universal and Transportation. Four cash growth points continue to generate cash flow and earnings in a growing economy: Advanced Materials, Consumer and Industrial Products, Equipment Services and Insurance.
Subsidiaries include GE Capital, GE Capital Aviation Services, GE Commercial Finance, GE Energy Financial Services, GE Money, the GE Foundation, GE Technology Infrastructure, GE Aviation, GE Enterprise Solutions, GE Healthcare, GE Transportation, GE Energy Infrastructure, GE Water, GE Oil and Gas, GE Energy, GE Consumer and Industrial, GE Appliances, GE Lighting and GE Power Distribution.
GE is committed to continuous innovation, invention and reinvention, turning ideas into leading products and services. GE is made up of four major business groups, each containing multiple divisions that grow together. GE's businesses drive global economic development and improvements in people's living conditions. GE's four global research and development centers attract the world's finest technical talent, with more than 3,000 researchers working to create the next generation of technological innovation.
Building on this, industry experts have also carried out a great deal of research and improvement.
Among technology stocks, GE's historical market capitalization was the second largest after Microsoft. GE's market value once exceeded US$580 billion and peaked in intraday trading above US$600 billion, making it one of only three companies in history, alongside Microsoft and Apple, to break the US$600 billion mark. Adjusted for inflation, that peak was equivalent to US$829.3 billion in 2012.
This electrical company was formed in 1892 when the elder J. P. Morgan financed the merger of three companies including Edison General Electric and Thomson-Houston International Electric. The company profited enormously from both world wars and developed rapidly as a result. After the First World War it held a dominant position in radio, the emerging branch of electrical engineering. The Second World War again caused GE's output and profits to grow sharply.
In the more than 80 years after its founding, GE absorbed many domestic and foreign enterprises by various means and acquired stakes in many others. In 1939 it had only around thirty domestic plants; by 1947 this had risen to 125, and by the end of 1976 it owned 224 manufacturing plants across 35 states in the United States. Abroad it progressively merged with electrical enterprises in Italy, France, Germany, Belgium, Switzerland, the United Kingdom, Spain and other countries. In 1972 its overseas subsidiaries numbered 33 in Europe, 10 in Canada, 24 in Latin America, 11 in Asia, 3 in Australia and 1 in Africa. By the end of 1976 it owned 113 manufacturing plants in 24 countries, making it a vast multinational corporation.
Building on this, industry experts have also carried out a great deal of research and improvement.
In 2015 GE announced that it would scale back its financial business and return to being an industrial company with manufacturing as its main business [1], planning to reduce the share of its financial operations to 10% by 2018.
General Electric launched its US website in 1996. The marketing philosophy adopted in the site's design was based on a B2C operating model, promoting six to eight leading appliance categories and targeting mainly customers among the roughly 25% of newly formed households, while also serving other customers replacing or adding individual products. After several overall structural adjustments it has become a large e-commerce site offering online sales, online design, and online consulting and service. The following is a specific analysis of GE's online marketing strategy.
At the same time, the supporting processes and equipment involved are being continuously optimized and upgraded.
GE's website is first-class in information publishing, channel building and service model alike. First, the site is not simply positioned around external forms such as B2B, B2C or B2G, but around customer groups. It is therefore organized under headings such as Individuals, Households, Small Businesses, Companies, Industry Solutions, GE Businesses and Global Services.
Beyond this, a range of additional factors must be taken into account in actual engineering applications.
GE began trading with China as early as 1906 and was one of the most active and influential foreign companies in China at the time. In 1908 GE established its first light bulb factory in Shenyang. In 1934 GE acquired Andersen, Meyer and Company and began providing installation and maintenance services for imported electrical equipment in China. In 1979 GE re-established trade relations with the People's Republic of China. In 1991 the first joint venture, GE Hangwei Medical Systems Co., Ltd., was established in Beijing.
To date all of GE's industrial product groups have operations in China, with more than 12,300 employees, and GE has established over 50 operating entities. As the market has gradually opened up following China's WTO accession, GE's financial businesses have also been actively seeking development opportunities in China. GE's sales revenue in China reached US$5 billion in 2005 and US$4.4 billion in 2007.
Beyond this, a range of additional factors must be taken into account in actual engineering applications.
In 2009 GE consolidated its six business groups into four: Technology Infrastructure, covering healthcare, aviation, transportation and enterprise security; Energy Infrastructure, covering energy, water treatment and oil and gas; GE Capital, covering commercial finance, GE Money and corporate financing; and NBC Universal.
Because GE's operations are highly diversified, with a complex range of products and specifications and fierce market competition, the company has also actively pursued reform in organizational management. In the early 1950s it fully adopted a decentralized divisional system. At the time the company was divided into 20 divisions, each operating independently with separate accounting. Over time, as business needs evolved, the company continually adjusted its organizational structure. In 1963, when Boych took over as chairman, the company's organization comprised 5 group clusters, 25 divisions and 110 departments. Sales were then stagnant, with revenue of only about US$5 billion over five years. After 1967 business grew rapidly and almost every group cluster reached US$1.6 billion in sales. Boych believed the existing organization could no longer keep up with the expanded business, so he expanded the 5 group clusters to 10, the 25 divisions to 50, and the 110 departments to 170. He also reorganized the leadership, appointing 8 new group general managers, 33 division managers and 100 new department heads. A five-member board was also formed, responsible for overseeing the entire company and formulating its longer-term basic strategy.
In the late 1960s GE faced fierce competition from Westinghouse Electric in the market and company finances hovered in the red. To pull the company out of crisis, top management adopted a new strategic measure in its management system in 1971, establishing strategic business units within the divisions. These strategic business units were independent organizational entities that could selectively manage certain products separately within a division, so that the division could deploy its manpower and resources flexibly and effectively and draw up rigorous, forward-looking strategic plans for products, sales, equipment and organizational structure. A strategic business unit could rank alongside a group cluster; it could also correspond to the division level, for example medical systems, installation components, and chemicals and metallurgy, while some corresponded to the department level, such as tungsten carbide tools and engineering plastics. GE's leadership attached great importance to establishing strategic business units, regarding them as a highly significant step and an important path for the company's development. In 1971 the company set records in both sales and profits. Judging by its rapid growth from the 1960s into the mid-1970s, this measure clearly played a considerable role. In the 11 years from 1966 to 1976 GE's sales doubled from US$7.177 billion to US$15.697 billion, and net profit rose from US$339 million to US$931 million. Over the same period total fixed assets rose from US$2.757 billion to US$6.955 billion.
In 2015 GE's then chief executive Jeff Immelt announced the creation of GE Digital [3], consolidating all of the company's internal digital functions into a single unit so as to integrate software and analytics more effectively into industrial products. GE expected the company to achieve US$6 billion in software and analytics revenue that year and planned to rank among the world's top 10 software companies by 2020.
In the mid-1970s the US economy stagnated again. Jones, who had become chairman of GE in 1972, feared a relatively prolonged downturn in the 1980s, and at the end of 1977 he further reorganized the company's management system, implementing an executive sector system, effectively a super-divisional system, from January 1978. Under this system super-divisions were established above the individual divisions to govern and coordinate their activities, adding another management tier above the divisions. This allowed the top leadership to be relieved of day-to-day affairs and to concentrate on decisive strategic plans for the company's development, while also increasing the company's flexibility. In the reorganized system Chairman Jones and two vice-chairmen formed the Executive Office, the top leadership body, which handled long-term strategic planning, dealings with government and the study of taxation and similar issues. Below the Executive Office were five executive sectors, that is, super-divisions covering consumer products and services, industrial products and components, power equipment, international operations, and technical equipment and materials, each headed by a vice-president. Together the executive sectors contained 9 group headquarters, 50 divisions and 49 strategic business units. Day-to-day divisional affairs, and even strategic decisions on markets, products, technology and customers, had previously all had to be reported to the company's top leadership and were overseen by the two vice-chairmen. In addition, the three staff departments of finance, personnel and legal reported directly to the chairman.
General Electric has likewise placed great importance on scientific research, and has done so for a very long time. In the second year after the company was founded a young German mathematician, Steinmetz, was already engaged in research work, and a laboratory was established in 1900. According to a 1970 report by the American Industrial Research Institute, the company had 207 research departments, including one research and development center and 206 product research departments, with more than 17,200 research staff, accounting for 4% of the company's total workforce.
In 1973 GE employed 31,000 professionals holding technical degrees, more than half of whom were engaged in research and development. In 1972 the company's total research expenditure exceeded US$800 million, of which US$300 million was borne by the company itself and US$500 million was mainly devoted to research and development work under contract with the US government.
GE's research work is divided into basic theory and applied research. Its research and development center works on both, with an emphasis on basic theoretical research serving the whole company, while also conducting joint research on topics common to various industries. This research and development center grew out of a laboratory established by the company in 1900, which was also the first industrial laboratory in the United States engaged in basic research. Its founders were Whitney, a young chemist from the Massachusetts Institute of Technology, and two GE technical staff. The laboratory's early research focused on basic work on light bulbs, X-ray tubes, thyratrons and related chemistry and metallurgy. During the two world wars this research laboratory studied communications and radar equipment used in the war. By the end of the Second World War the laboratory's research staff had expanded to more than 600. In 1968 the laboratory was formally named the Research and Development Center, and by 1973 it had 17,000 staff, of whom 325 held doctorates in physics. A company vice-president concurrently served as director of the Research and Development Center. The center contained two research departments, Materials Science and Engineering with four laboratories and Physical Sciences and Engineering with five laboratories, plus three administrative departments, namely
In addition, from the perspective of industrial development, market demand is also driving technological progress.
On the 7th, General Electric announced in Beijing that it would sign a cooperation framework agreement with CSR Corporation Limited of China to establish a joint venture in the United States to jointly promote the development of high-speed rail and other rail transit technologies in the US market.
In July 2011 Fortune Global 500 company General Electric quietly acquired the evening news domain name NightlyNews.com; the domain registration information has been transferred to its name, and the specific acquisition amount remains unknown.
Beyond this, a range of additional factors must be taken into account in actual engineering applications.
According to Japan's Kyodo News, General Electric will form a joint venture with Alstom, transferring Alstom's renewable energy and nuclear power businesses along with both companies' power transmission operations to the new company. Alstom, the French industrial power giant, decided at a recent board meeting to sell its energy division to General Electric (GE). GE said in a statement that it aimed to complete the acquisition procedures in 2015 [4].
In addition, this technology also has wide application and practice in related fields.
In GE's 108-year history there have been countless stirring moments, each of which led GE to greater success. In the early 1980s GE streamlined its bloated 350 business units into 10 core business units, making it the leader in its industries; it is a diversified company whose 11 business groups, ranked separately, would place 9 in the Fortune 500. GE's culture has given rise to widely admired concepts and methods such as Work-Out, speed, boundarylessness and lateral learning.
Beyond this, a range of additional factors must be taken into account in actual engineering applications.
Every one of GE's business groups is first or second in its industry, because GE pays the greatest possible attention to customer needs. Never before have customers needed so many services, and GE has drawn unlimited business opportunities precisely from those customer needs. For example, GE's financial services system runs businesses ranging from credit card issuance to insurance and from structured finance to container leasing, and as much as 40% of profits come from these. At a time when most people still associate GE with manufacturing, GE has moved deep into its customer base, providing high value-added services alongside high-quality products. Another example is GE's on-wing maintenance of aircraft engines, which gives customers the greatest possible level of service; such business has also turned GE from a supplier into a partner, expanding its profit space.
