Global Strategy and Implementation for General Electric

GLOBAL STRATEGY AND
IMPLEMENTATION

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
1. Reason for parent company international expansion..............................................................1
2. Possible strategic choice available for parent company..........................................................2
3. Reason for selecting choice of location for subsidiary............................................................4
4. Strategic method of entry and possible consequences.............................................................4
5. Potential organizational and managerial problem for subsidiary company in operating its
business in international environment.........................................................................................6
6. Strategic advice for subsidiary company to overcome problem..............................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Global strategy is company that wants to expand its business in global market to earn more
profit margin and sales volume. So, the main aim of global company is to increase sales of
goods and services across the abroad for benefits of firm. Company while planning strategies
related to international expansion, needs to make efforts to understand market situation to find
best method to meet customer’s expectancy. General electric company is American
Multinational conglomerate in New York and having its headquarter in Boston that has
segments into healthcare, digital industry and locomotive. This report has covered key
information related to reason for parent company’s international expansion, strategic choice
available to parent company, reason for selection of location for subsidiary, strategic method of
entry and possible consequence. At last it has also explained about potential organisational and
managerial problem face by subsidiary in international environment.
1. Reason for parent company international expansion
COMPANY HISTORICAL PERFORMANCE
General electric has been initially founded in 1878, by Edison Electric that sell newly
invented light bulb so that wants of the customers can be fulfilled in the best possible manner. In
December 1985, the company have reacquired the RCA for $6.28 billion thus such merger has
contributed in surpassed the capital cities. Furthermore, in 2004, it has bought 80% of Vivendi
Universal Entertainment with an motivate to earn high profit margin and growth in future
circumstances. The company was keep growing its operation, i.e, currently the firm is having
around 205000 employees and had earn revenue of US$ 75.619 billion. Moreover, as per the
statistical information the GE has been rank among 33 largest firm in United States in terms of
gross revenue earned (Peng, 2021). At the same time, it is most 14 th profitability organization
that has focused on delivering qualitative services to customers. In 2013, there were around
307,000 but in 2018 they have been reduced such as 283,000, along with it price per share has
also been decreased. Therefore, General electric in order to retained its market share in
international market has planned to expand its operation in external environment and earn high
profit margin.
Products and services
1

General electric has been dealing in wide range of products and services from GE
Aviation, GE healthcare, renewable energy and power and many other services to make
customers happy and satisfied. The wide product portfolio of firm has helped in attracting and
motivating people to become parts of organisation to fulfil their respective requirements. Along
with it, there are also other subsidiaries company of GE that offers services such as GE Capital,
GE Additive, GE Digital and GE Aviation (Hadaya and Gagnon, 2017). Thus, it products and
diverse range of services has helped company in gaining and retaining competitive advantages.
Market share
The company have earned around 22 billion of US dollars in the aviation segment that
has lead in generating more sales volume and profitability. While comparing the result or profit
that has been earned by GE with its competitors, it has been find out that there had been increase
in overall profit by 2.98% by the second quarter of 2021. In addition to this, it can be stated that
the market shares or profit margin of company have decreased in comparison to previous year so
it needs to plan strategies to retained the market share and achieve the end goals.
So, from the above information, it can be said that there are numerous reasons which
enforce GE to expand its business in international market. Such as have a objective to increase
revenue, or enter into new market to add more customers in the firm. Furthermore, it helped in
expansion company in accessing the talented employees form different parts of the world so that
all task can be completed simultaneously (Hayati, Atefi and Ahearne, 2018). The parent
company i.e., GE has reason to enter into international market because it will contribute in
saving overall cost and improving the company reputation. So that millions of customers from
different geographical location are influence to have services of company in order to satisfied
their respective wants.
2. Possible strategic choice available for parent company
With globalisation and increase in competition level in external environment,
multinational company needs to plan appropriate strategy that could be used by the parent
company so that end objectives can be achieved. Multi-domestic, Global, International
and Transnational are the four strategic alternative choice or options that
are available for parent company to retained market share in external
environment (Huang. and Rust, 2017). Such as:
2