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General Electric (GE) was founded in 1892 from the merger of Thomas Edison’s Electric Light Company with the Thomas Houston Company. Their business was based upon exploiting Edison’s patents relating to electricity generation and distribution, light bulbs, and electric motors. In 2005 and 2006 GE was Fortune’s “Most Admired Company.” Now it is an advanced technology, services and finance company dedicated to innovation in energy, health, transportation and infrastructure. GE operates in more than 100 countries. GE has had a few major keys to its success over the years, most notably its management style, massive size, ability to constantly adapt, and major acquisitions over the years. Throughout the 20th century, they have not only been…show more content…
He started off with things like product bundling and cross-selling that led to what Immelt referred to as “enterprise selling. The biggest challenge for a conglomerate like GE is to continue to drive consistent growth. To be successful, GE must regain flexibility to adapt its business portfolio to the demands and opportunities of the 21st century. Immelt needs to find new ways for GE to deliver long-term profit and growth that investors have come to expect of GE. Will Immelt’s strategy of exploiting linkages across businesses be successful in delivering targeted growth and profitability? Although Welch and Immelt, for the most part, managed differently, there were some similarities in their management styles, which have proven to be a success. One of the most notable strengths of their management styles is separating the firm into different divisions. There are four favourable efficiency advantages of a divisionalized firm: Adaptation to “bounded rationality” where managers are restricted in their capabilities and information bases; Allocation of decision making: high frequency decisions, such as operating decisions are the responsibility of those at the divisional level. While infrequent decisions, such as strategic decisions, are the responsibility of those at the corporate level; Minimizing coordination costs: because decisions can be made at a divisional level, time is not wasted while relying or depending on another division that has no

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