Sample Paper on General Electric’s Expansion in the Middle East

Identify the principal concepts, theories, and practices in the functional areas of business.

Management consists of Board of directors, CEO and the managers. Their principal duties are to supervise those people that are beneath them. The CEO is the key top personnel that can make a business prosper or fall back. e.g., when Welch became CEO of GE, he reduced workers from 404,000 to 292,000, and he grew revenue from $27bn to $100bn. “Welch overhauled GE’s talent management strategy introducing Vatality curve which ranked employees against a set of performance attributes and behaviors. He introduced the concept of Work-out session to take” unnecessary work out of the system” increased productivity by looking outside the firm for best practices and reduced waste via GE’s Six Sigma process improvement program”(Mark, 2015) GE train their own personnel to ensure they have needed skills for operations and that they remain royal to the company.

  1. Identify the Market environment of the business

Internal environment factors mainly include labor, company policies, inventory, and budget. These factors influence how marketing in GE is going to be performed and labor productivity of the company. Furthermore, we have microenvironment which are all factors that are tied with the main operations of the business (Mark, 2015). In the GE case, they include customers, vendors, suppliers, distributors, retailers, and competitors e.g. Siemens. Finally, we have macro-environment marketing which are all uncontrollable factors that exist outside the GE organization. They include social, technological, political and economic factors.

 

  1. Evaluate the Strengths, Weakness, opportunities & challenges associated with the company.

Strengths of GE

Skill development: The company has trained several citizens of the countries they are located. This ensures that GE has the best working force with needed skills to execute the day-to-day duties.

Innovation and Creativity: This is the driving force towards GE success. Innovations on service delivery, production of goods, marketing and partnerships through Joint ventures or C2C are the reasons behind GE success.

Production of different products: GE Company mainly deals with selling of electrical appliances and equipment (Ocean, n.d). However, it also offers services such as oil refinery and water purification which ensures that they are in demand in one way or the other.

Weaknesses of GE

Deteriorating market share: Even though the revenues of GE are increasing yearly strategy and execution firms are growing at a faster rate (Ocean, n.d). Due to this the company needs to analyze current trends and come up with a strategy to propel future growth.

Easy Business model: a competitor can easily initiate GE model thus reducing the overall performance of the company. To check on this, the company needs to integrate vendors, suppliers, and end-users.

High costs associated with replacing current experts of the company: Few employees know the core of GE business; hence replacing them is going to be very difficult.

Opportunities of GE

Technological innovations: technology change is improving total productivity. For instance, the introduction of robots ensures high precision is achieved and at the same time goods of high quality are produced.

Preferences of customers are dynamic: this is facilitated by the curiosity of the customers to try other new products, and how easy it is to access information with internet access.

Rapid Economy expansion: US economy is growing fast, and this offers GE an opportunity to grow.

Threats/ Challenges of GE

Competitive pressures: Introduction of other quality products at a lower price by other emerging companies such as Phillips and Siemens is a threat to the existence of GE Company.

Dynamic political environments: For instance, the US and China trading war bring about overall instability in both local and international markets.

  1. Application & Evaluation of the business-related decision-support for the formulation of management decisions. :-Through the following questions
  2. Why are companies interested in expanding into emerging economies if they are well known for politically instability and corruption?

 

MENAT regions are known to be safer for businesses and have a huge potential for growth as compared to already developed countries. Also, MENAT region is less affected by economic crisis due to “minimal investments in risky securities and a solid outlook for growth over the coming few years” (Mark, 2015). Emerging economies are at initial stages of adopting technological infrastructure worth trillions of dollars thus wise to invest in those regions. In the case of Saudi Arabia, with increasing prices of their oil, the governments were becoming ambitious in investing in the country. This provided a good opportunity for GE to invest in that region.

 

 

  1. How GE succeeded in operating in MENAT given the barrier to its entry it was facing?

By getting into joint ventures with the firms located around the MENAT from where they checked on six key elements: tailored integration, material share, the right partner, the right people, operative structuring, and value proposition. They also engaged themselves in company-to-country (C2C) where the government was the customer in this case (Mark, 2015). This was agreements that GE signed with the government through concerned ministries and training local people into their business.

  1. How can GE achieve a continuous high rate of growths without compromising high corporate standards?

GE should follow a specific strategic growth plan: This should consist of performance indicators, market expansion plan, and revenue streams. This lay a platform of all functions of the business that will be carried out.

Embrace new technologies: there are more efficient ways of doing business with current improved technologies; hence it high time GE embrace technology in marketing, service delivery, and in production for higher efficiencies and increased production.

Follow feedback from customers: This is achieved by checking their comments and reviews of GE products and services so that you can improve or find another way of achieving quality products at affordable prices.

 

  1. What pitfall should GE MENAT watch out for as it expands in the region?

MENAT regions are associated with high corruption rates as indicated by their high CPI. Therefore, GE should take precaution not to host corruption in their own company, as this will lead to a drastic reduction in its annual revenue.

 

 

References

Ocean, B. (n.d). “General Electric’s Expansion in the Middle East SWOT Analysis / SWOT Matrix” Retrieved from http://blueoceanuniversity.com/frontpage/swotcase/14508-ge-menat

Mark, K. (2015). “General Electric’s Expansion in the Middle East.” Western University London, Ontario, Canada. Ivey Publishing.