在接下来的十年中,基础设施技术业务将推动通用电气增长。在给投资者的报告中,提到“基础设施可以充分利用通用电气企业优势。我们的技术是企业中常见的,所以我们可以再次创新我们的投资组合。我们都有一个共同的方法来服务我们的基础。我们企业与新兴市场的政府有着深厚的关系,关乎我们整体的基础设施。”
解决能源和医疗问题是社会所需要的,通用电气继续推动两个产业结构的增长,相关举措包括绿色创想。下面是通用电气在未来几年的焦点,我们可以称为通用电气更新模型:
根据Bloomberg新闻报道,“未来十年或几十年的时间里,中国和印度这样的地方将会出现大幅度的增长,”伊梅尔特在北京表示。”这篇文章说,通用电气计划在中国投资20亿美元”。
In the next decade, Infrastructure Technology business will drive growth for GE. In the letter to investors, it is mentioned that "Infrastructure can fully leverage GE enterprise advantages. Much of our technology is common to multiple businesses, so we can spread innovations across our portfolio. We share a common approach to servicing our installed base. We enjoy deep relationships across our businesses with emerging-market governments who look at infrastructure in its totality."
To resolve the problems of energy and healthcare that society needs, GE has continued to drive two infrasrtructure growth initiatives including ecomagination and healthymagination. Below is GE's focus in the next years called GE Renewal Model:
According to Bloomberg News, “The growth in the next decade or decades that’s going to take place will be quite robust in places like China and India,” Immelt said in Beijing. This article said that "General Electric Plans to Invest $2 Billion in China".
With the impact of the global recession and financial crisis, revenue & profit of GE considerably decreased in 2008 and 2009 compared with 2007. However, GE still keeps the position as one of the top ten successful corporation with high revenue and profit. GE ranked 6th, 6th, 5th, and 4th in 2007, 2008, 2009, and 2010 Fortune 500, respectively.
In 2011, GE ranked in the list of top 10 companies that investors should seek growth and income. It was selected due to it has the strong growth potential with the good position in health care, energy, water filtration, jet engines and rail engines.
In 2007, NBC Universal had a trong performance. After that, it was uneffective and GE sold a controlling stake in its NBC Universal entertainment unit to Comcast at the end of 2009. GE also faced some difficulties in financial services since 2008 and it is under the control now.
GE has effectively responded to the increasing demands of society for greater Corporate Responsibility. While developing the long-term business strategy to increase revenue / profit for company, GE considers the benefit of all stakeholders. GE are committed to honor human rights to employees, suppliers and communities wherever they do business. GE contributed to the global communities through philanthropic programs focusing on two main themes: education and healthcare. The resources is given bu GE family including employees, businesses, retirees and GE Foundation. Citizenship priorities of GE consist of their people, compliance & governance, public policy, environment, human rights, their products & services, their customers, their communities.
GE has well responded to the challenge of sustainability by developing innovations. To meet the increasing demand for commercial and military aircraft and fuel steep price increase, GE applied the "Rhenium Reduction Program: Using Less of a Rare Mineral". This program also helped reduce the Carbon Footprint. Beside that, ecomagination and healthymagination reflects GE's Corporate Responsibility as well. "Ecomagination is a business initiative to help meet customers’ demand for more energy-efficient products and to drive reliable growth for GE" and "Healthymagination is GE’s six-year, $6 billion commitment to healthcare innovation that will help deliver better care to more people at lower cost, all while growing the company".
Climate change is one of three key pillars of GE's corporate citizenship strategy. GE joined Group Urging Mandatory CO2 Reduction to address the challenge of climate change. The United States Climate Action Partnership (USCAP) was formed with the participation of GE and other major multinational companies such as Alcoa, BP America, Caterpillar, Duke Energy, DuPont, FPL Group,... to take action on their goals and their commitments. Beside that, GE has also worked with the NGOs on many other initiatives. The 2005 launch of ecomagination is one of key innovations. This idea helped to reduce greenhouse gases. In addition, GE help customers reduce greenhouse gas emissions by offering the initiative products and services. To keep their commitments, GE has the huge investment on Research & Development, especially advanced technology.
The GE family plays a critical role in helping the affected communities get back to their normal life when a disaster strikes. The specific case is GE responding to an earthquake in China in 2008 by donating cash and equipments: "Within 24 hours of the earthquake, GE Foundation had donated 1.4 million to the Chinese Red Crescent Society". They also provided healthcare products for hospital tents, emergency lighting for search and rescue missions... The second case is GE responding to the crisis in Darfur: "GE and GE Foundation have provided more than $5 million to the crisis in the Darfur region." GE has provided medical aid to communities in Africa. This is the Developing Health Globally program that GE has partnered in Ghana to donate products, technology and knowledge to improve access to healthcare for the Apam district.
Major crisis has faced GE in the past few years
Turmoil in the financial markets hard hits GE's financial services division
GE has had to face a major crisis regarding GE capital while this business has been generated the most revenues and profits for GE over the past years.
GE has gained the huge revenues and profits in 2007, so their release of the big fall in earnings in the first quarter of 2008 create the shock waves though the financial markets. This result has made GE to face the difficulties and challenges due to it has increased investors’ worry about risks that may happen to the earnings outlook for the fiscal year.
The global economic growth slowing made investors to concern that there would be the decrease in demand for GE's infrastructure products, strongly hurting company's operations.
GE shares was down about 32 percent until September 2008 and was hit five-year lows. It is known that over half of GE's profits come from GE capital. Investors expressed concern that how GE can avoid the loss in the credit market meltdown.
Signals above start for uneasy period of GE financial services. During 2008 and 2009, GE’s dividends, revenues and profits have seriously been impacted.
In gereral, GE well controlled revenues but the profits considerably decreased during the financial crisis. Capital Finance 2008 revenues still increased by 1% while profit drop to 29%, compared with 2007. Impact of the crisis in 2009 was even worst. Capital Finance revenues decreased 24% and profits
decreased 73% compared with 2008.
2009 profits of most of products & services in capital finance business decreased more than 50% compared to 2008, even Energy Financial Services dropping to 74%.
In the letter to investors in GE 2009 annual report, GE CEO Jeffrey Immelt has presented the important changes to overcome the recession and economic meltdown. GE has focused on four main goal:
“Keep GE safe and secure”. GE cut employment by 10% during 18 months, cut their dividend, and increased equity. They reduced their reliance on commercial paper and long-term debt. They Trimmed their net investment on Capital Finance by more than $50 billion. Resources will be focused on segments continuing deliver high returns.
“Execute and position GE’s infrastructure business to perfrom through the cycle”. They make their position stronger in the emerging markets in Australia, Brazil, China, and India. They grew product services that are beneficial to their customers.
“Create financial flexible”. During 2009, GE raised their shareowners’ equity by 413 billion. They reduced working capital by generating nearly $17 billion of industrial cash flow.
"Protect our fanchise and brand". They spent more money on research and development than before and has planned to produce more products. Energy and health care are sectors that GE has also focused on in incoming years.
GE has planned to sell off its NBC entertainment division to Comcast. This transaction will help free up cash for expanding purpose.
"GE must be an industrial company first. We have increased our investment in industrial growth. We will only grow strategically in financial services. We will carefully monitor our size and return capital from our financial services business as soon as possible." This is the formal announcement from GE CEO in the letter.
Over the past few years, GE's strategies focuses on the following: globalization, customer focus, services, innovation, technology. The main values have still been kept although there are minor changes for best adapting to each specific period and scenario of the market. They have mainly expanded their globalization in emerging markets such as Chinese, India… where there is a high demand for their products.
“Our competitive advantage in technology is based on robust investment, an innovative team and our ability to create a low-cost position. In 2010, we will spend about 5% of our industrial revenue on R&D. We have filed 20,000 patents this decade. We have nearly 40,000 engineers and scientists around the world.” With the core strengths in infrastructure, good partnerships with leading companies and deep relationship with emerging market governments, GE can grow their business to achieve their strategic goals. They can make a difference by using their innovation to produce more and more great products to resolve problems in energy, health care, transportation, water, aviation sectors.
“Growth is the initiative, the core competency we are building at GE. To achieve this, we are developing a different kind of GE leader.” Initiative is a key value of GE. Their slogan "Imagination at work" (imagination = innovation) also shows that.
GE ranked #19 in the world's most innovative companies, 2010 for new ideas of products in health care such as "The pocket-size Vscan ultrasound device", "the Mac 400 and 800 ultra-mobile ECG machines", "The Centricity Electronic Medical Record system"...
In 2011, GE ranked #45 in the list of 50 companies for “GE's RailEdge Movement Planner software” and “GE's Required Navigation Performance flight-path-management software”.
Firstly, GE has a rich history with big achievements from the earliest days when concentrating on research. They contributed the big part to create and change the world of tomorrow. Secondly, I admired their investment on training and education programs that focus on the leadership development. This means GE's employees will be leaded by the best leaders as well as have opportunities to learn and grow by being offered challenging, rewarding careers. Also, GE created and maintain the right environment to encourage employees to develop at the highest levels. Thirdly, GE’s businesses and products aim to bring better life to communities. GE cares of saving resources and protecting the healthcare in communities. Fourthly, I like the way that GE make the difference by developing the innovation and inspiring their employees with this competitive advantage.