Focus on Star and Question Mark!!
Original Article
Good-bye to GE Appliances
Posted by: Diane Brady on May 14
Summary
The world renowned US corporation, GE is about to sell its appliances business. The reason why GE decided to give up its electronic appliances division could be summarized two things. First, it’s not global and US domestic market is so volatile. Second, GE’s electronic appliances business doesn’t have competitive edge in comparison with its competitors.
Due to its powerful brand awareness, electronic appliances company love to buy GE electronic appliances division. Especially Sweden’s Electrolus is expressing strong interest in merging GE’s electronic division. However, it isn’t clear that GE appliances unit would be appealing or not, if GE doesn’t allow a new buyer to use their brand name.
My opinion
Thomas Edison started GE in 1878 with his invention product, light bulb. After that, for 130 years, GE has been continually grown due to its innovative spirit. GE has awesome slogan which is pretty well matched with their value, “Innovation at Work”. Whenever I read this slogan, I could feel that GE continues to grow through taking a risk rather than stay safely where they positioned.
In this sense, selling electronic appliances division is something I could expected GE to do. To be quiet honest, I actually thought that GE already sold its traditional department. Although people still have perception that GE is still making major part of profit from its traditional division like plastic or electronic goods, in fact, GE successfully transformed itself as a high technology and solution company as IBM did. I can’t say GE’s electronic appliances division has been negative factor for GE because it played a role as a cash cow for last 5 years due to prosperity of US real estate market. However, owing to sub-prime mortgage, the demand of house was radically plunged so the profitability of electronic goods also were decreased.
At this moment, selling less profitable division that is considered to be ‘dog’ and restructuring
group organization are considered to be right decision. GE has been restructuring their business model and now GE provide competitive products and services in finance, aviation, health care, energy, security which is placed in ‘star’ or ‘question mark’. I think those are the division which will feed GE for the next 10 or 15 years and they have to focus on those star and question mark rather than grabbing dying dog.
Original Article
Good-bye to GE Appliances
Posted by: Diane Brady on May 14
Summary
The world renowned US corporation, GE is about to sell its appliances business. The reason why GE decided to give up its electronic appliances division could be summarized two things. First, it’s not global and US domestic market is so volatile. Second, GE’s electronic appliances business doesn’t have competitive edge in comparison with its competitors.
Due to its powerful brand awareness, electronic appliances company love to buy GE electronic appliances division. Especially Sweden’s Electrolus is expressing strong interest in merging GE’s electronic division. However, it isn’t clear that GE appliances unit would be appealing or not, if GE doesn’t allow a new buyer to use their brand name.
My opinion
Thomas Edison started GE in 1878 with his invention product, light bulb. After that, for 130 years, GE has been continually grown due to its innovative spirit. GE has awesome slogan which is pretty well matched with their value, “Innovation at Work”. Whenever I read this slogan, I could feel that GE continues to grow through taking a risk rather than stay safely where they positioned.
In this sense, selling electronic appliances division is something I could expected GE to do. To be quiet honest, I actually thought that GE already sold its traditional department. Although people still have perception that GE is still making major part of profit from its traditional division like plastic or electronic goods, in fact, GE successfully transformed itself as a high technology and solution company as IBM did. I can’t say GE’s electronic appliances division has been negative factor for GE because it played a role as a cash cow for last 5 years due to prosperity of US real estate market. However, owing to sub-prime mortgage, the demand of house was radically plunged so the profitability of electronic goods also were decreased.
At this moment, selling less profitable division that is considered to be ‘dog’ and restructuring
group organization are considered to be right decision. GE has been restructuring their business model and now GE provide competitive products and services in finance, aviation, health care, energy, security which is placed in ‘star’ or ‘question mark’. I think those are the division which will feed GE for the next 10 or 15 years and they have to focus on those star and question mark rather than grabbing dying dog.
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