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General Electric Business Strategy

We will use General Electric, also known as GE, to illustrate how internal and external factors affect the four functions of management. We will explain how globalization, technology, innovation, diversity, and ethics affect the four functions. We will also explain how delegation can be used to manage the different factors.

General Electric has come a long way since its inception in 1876 by Thomas Edison, several of his early business offerings are still a part of General Electric to this day. General Electric has become one of the greatest innovative companies in business history.

General Electric has grown to become an international company which has expanded its products and services around the world. External and Internal Externally borrowing money to stock inventory can affect the four functions of management. Everybody needs a certain amount of money to operate.

Other financial factors that affect your inventory management decisions include cost of warehouse operations and transportation costs. The cost of gas is an external factor while the choice to purchase your own trucks or use outside contractors can prove to be a more predictable internal factor.

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Your sales goals and customer service objectives are internal controls that you direct. For example, if you promise same-day delivery, your inventory management must have the product on hand to meet customer demands. Economic downturns, poor real estate markets or local competition are external controls over which you often have no recourse.

Flexibility to deal with market ups and downs should be an integral part of your company goals to bend pricing rules, offer discounts or sit on your inventory when shifts in consumer buying habits occur.

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One of the most frustrating external factors for business owners is an unpredictable or unreliable supplier. Product suppliers who deliver poor-quality merchandise also can throw unexpected snags into your inventory supply chain. Understanding suppliers’ lead-time requirements can help you maintain sufficient inventory.

Finding and utilizing backup suppliers is an internal decision that also can cover inventory shortages. Joining a bulk-purchasing group places some of your inventory control in the hands of others, but may prove to be worthwhile.

Globalization

When developing a global strategy, companies identify their international objectives and assemble a strategy that will enable them to realize their goals. During the planning stage managers propose, revise, and finally ratify plans for entering new markets and competing in them, then, managers must take steps to have it implemented.

Not only when to begin global operations but also when to actually start operations and put into action the other components of the global strategy (Helms, p858-863). Strategy development involves analyzing the company and its environment (planning), establishing strategic goals (organizing), and developing plans to achieve goals (leading) as well as a control framework (controlling). Once this analysis is complete, managers must establish the significant goals a company seeks to achieve through a particular pursuit such as entering a new regional market.

Then companies should develop plans that allow them to accomplish their goals, and these plans should concentrate on how to implement strategic plans. Finally, strategy formulation involves a control framework, which is a process management uses to help ensure that a company remains on the right course when implementing its strategic plans.

Technology

Advances in technology are important to the success of General Electric. Bateman and Snell (2009) states, “Technological advances create new products, advanced production techniques, and better ways of managing and communicating.

In addition, as technology evolves, new industries, markets, and competitive niches develop” (p. 55). General Electric’s Global Research Center provides research data on how technological advances affect the company and how management effectively plans and creates new products which are safe and efficient for customers and the environment. To achieve the goal of creating healthy and environmentally friendly products and providing services, General Electric uses new technology and research to aid in planning products implementing new ideas. The General Electric Company (2011) website has many articles and videos discussing products such as loating solar panels, artificial photosynthesis, biofuel for the aviation industry, and solar carports to charge electric cars from solar power. None of these projects are achievable if General Electric management does not thoroughly plan, organize, lead, and control the ideas from conception to completion. According to Bateman and Snell (2009), “Strategies developed around the cutting edge of technological advances create a competitive advantage; strategies that ignore or lag behind competitors’ technology lead to obsolescence and extinction” (p. 6). Using breakthrough technology is essential to General Electric’s success. The ground-breaking ideas of General Electric’s employees uses the advances in technology to improve existing products, create new products, and develop safe and efficient products in the future.

Innovation

Planning for innovation in an organization requires managers to use all four functions of management. Innovation affects the four functions of management within GE in this way; GE created software to manage the movement of trains in Norfolk Southern Train dispatch.

The planning, organizing, leading, and controlling of this project increased efficiency by 15-20%. The project that was organized many years ago took a partnership between two entities, one the supplier and one within the industry. Controlling the project managers lead efforts by establishing performance standards. The gain improved emissions, and the trains could go 486 miles with one gallon fuel. Their group operations planner system could expand the selling market by gaining productivity. GE has been at the forefront of innovation in 1942, and in less than a year GE invented the first jet engine in the United States.

The Auto pilot was developed in 1943 to keep aircraft on a continuous pre-determined course. The first commercial use of guided radar was brought to market from innovators at GE. There is a tradition of improving the quality-of-life with the invention of The Disposal, was introduced in 1935.

Diversity

A diverse workforce is essential to the success of General Electric. General Electric employs over 300,000 workers in more than 140 countries (General Electric Company, 2011). General Electric promotes a work environment that caters to the diversity of the company’s employees.

According to General Electric Company (2011), “GE is committed to supporting its leadership culture through systems and policies that foster open communication, maintain employee and partner privacy, and assure employee health and safety” (Working Environment). Many diversity issues affect workers within a company; race, color, ethnicity, background, religion, age, and sexual orientation are issues that managers must face within the workplace. Bateman and Snell (2009) states, “Managing diversity is not a new management issue.

From the late 1800s to the early 1900s, most of the groups that immigrated to the United States were from Italy, Poland, Ireland, and Russia” (p. 396). Society is rapidly changing and companies employ people from all walks of life. Managers must find ways to promote a safe and healthy work environment while continuing to lead the company’s progress. Discrimination of employees because of diversity issues can cause a failure in the functions of management. Involving all employees in the process of planning, organizing, leading, and controlling fosters a healthier work environment.

Wentling (1997) states, “No single approach to working with diversity can be recommended for all organizational situations. However, obtaining top management support, integrating diversity into all company functions, using a combination of strategies; and creating a corporate culture that supports diversity can be used with any approach to improve outcomes” (para. 16).

Ethics

Ethics planning must be carried out using all four functions of management. When employees are faced with an ethical dilemma their decisions affect the organization.

Researching GE’s website it was found that the four functions of management were factored in because they understand that the world expects corporations to be even more transparent and accountable. These amplified needs must restore confidence in employees, customers and suppliers alike. Leaders must have a strong sense of values in regard to the cultivation of a culture of ethics and compliance. With regard to integrity GE is recognizes that how they deliver outcomes is as important as the outcome themselves. Their corporate citizens programs are affected by the planning, organizing, leading, and controlling.

They state that employees are better people after leaving GE. Their culture is about providing everyone that works there with opportunities to implement responsibility, creativity and integrity while expanding every aspect of employee lives. The “GE Reports Imagination Daily” (n. d. ) website Employees make a commitment detailed in the policy by signing the pledge. This encourages employees to report ethical concerns without fearing retaliation. Work and life balance is GE’s commitment creating a health balance for employees between work and personal responsibility.

The corporation strives to be leaders in the workplace respecting the human rights of all stakeholders, committing to comply with all legal and financial policies.

Delegation

Almost all organization’s goals are staying ahead of the competition while efficiently ; effectively, maximizing resources. Effective resource management includes delegation. The four manager functions incorporate the delegation process. Planning what the task is and who should conduct the process/why is the task necessary, create a course of action. During the organization function, clearly explain the reason for the task or work that must be done.

State the required outcomes and results. Answer questions like; what must be achieved, what are the required resources, time and authority, also, define goals and expected results. During the leading process, provide and get feedback for teams members and individuals. It is important that you let people know how they are doing and if they are achieving their aim. Don’t get into blame-storming. You must absorb the consequences of failure, create an environment where failure is an opportunity to learn and grow and pass on the credit for success. Pay it forward if you can.

Lastly, controlling function includes getting agreements on timeline and deadlines. Include a status reporting feature to ensure things are getting done. When is the job to be done? What are the ongoing operational duties? What is the status report date and how is it due? Make sure you confirm an understanding of all the previous items. (Lannon) Include the following factors, Globalization, Technology, Innovation, Diversity and Ethics into the four classic managerial functions when focusing on the delegation task. Also, to stay competitive, organizations are required to exercise both centralized and decentralized ecision making. Centralized, strategies will be selected, to align with the vision, with the functional organizational leaders. Decentralized decision making needs to trickle down through the organizations to maximize task completion. Globalization requires delegation for massive task undertaking and shear geographical magnitude. Technological delegation is due to technical advancements that can maximize efficiency for resource preservation while propelling the plan towards profit. Innovation can be delegated to and collaborating with those with “outside the box” thinking.

Parlaying cutting edge advancements to reduce resources and maximize profit. Diversity encourages collaboration of new ideas that can be facilitated into ideas that advance the needs of the organization. Every aspect of delegating should focus of ethical standards. Doing the right thing, for the right reasons, benefit both the public as well as the organization. There are numerous examples of a company reaping rewards for ethical business practices. “We have always believed that building strong leaders is a strategic imperative. When times are easy, leadership can be taken for granted.When the world is turbulent, you appreciate great people. ” – Jeff Immelt, GE Chairman and CEO

References

  1. Bateman, T. S. , ; Snell, S. A. (2009). Management: Leading ; Collaborating in a Competitive World (8th ed. ). Retrieved from University of Phoenix E-Library.
  2. General Electric Company. (2011). Ecomagination. Retrieved from http://www. ecomagination. com/
  3. General Electric Company. (2011). Our Company. Retrieved from http://www. ge. com/company/culture/people. html
  4. General Electric Company. (2011). Working Environment. Retrieved from http://www. ge. com/company/culture/working_environment. html Wentling, R. M. 1997).
  5. Diversity Initiatives in the Workplace. Retrieved from http://vocserve. berkeley. edu/CW82/Diversity. html
  6. Lannon, Richard; 12 Rules of Delegation; Retrieved from http://www. pmhut. com/12-rules-of-delegation
  7. Ed. Marilyn M. Helms; Strategy in the Global Environment; Encyclopedia of Management; 5th ed. Detroit: Gale, 2006. P858-863.
  8. Bateman, T. S. ; Snell, S. A. (2009). Management: Leading ; Collaborating in a Competitive World (8th ed. ). Retrieved from University of Phoenix E-Library GE Reports Imagination Daily. (n. d. ). Retrieved from http://www. gereports. com/a-citizenship-focus-in-business-education/

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General Electric Business Strategy. (2020, Jun 02). Retrieved from https://studymoose.com/general-electric-business-strategy-essay

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