Chinese businesses are redefining enterprise by developing dynamic business management ecosystems.
The following evaluation conducts a strategic analysis of its internal resource capability, how it shaped its competitive strategy and a profound evaluation of its international strategy. The financial resources are stunning, but more important is to what they enables GEMS and why it is able to earn a superior profit margin.
The technological sophistication and flexibility of plants and equipment is great and builds the burden for a sufficient working supply chain. The excellent reputation makes it easy for GEMS to attract talents and bind them to the company for a long time.
This composition of resources offers a wide range of possibilities for GEMS. What the organisational capabilities are and how the resources are working together is shown next.
The main critical activities, which sustain competitive advantage for General Electric Medical Systems are linkages of capabilities that can be summarized by three main subchains which we refer to as the core competences of GEMS: Managing the value network and concentrating on the value creating activities of General Electric Medical Systems.
The learning organisation or how General Electric Medical Systems is keeping entrepreneurial spirit and being an innovative company.
Managing relationships or how General Electric Medical Systems is dealing with the global customer. Important part of the core competence in this case is the ability to focus on the activities which are your core competences and to look for outsourcing possibilities.
In this case GEMS realised that basic manufacturing is not one of its value creating activities. This manufacturing is centrally important for their own strategic capability and it retains direct control over this important capability.
Overall the complex configuration of resources and capabilities within their value network makes integration and interdependencies necessary.
Components plants locations in Mexico, India and Israel and specialised engeneering plants in locations as Hungary, China and Korea. To manage such dimension and to focus on its value creating activities the proactive learning organisation and the managing of relationship is not easy to achieve and a true competitive advantage over competitors.
The learning organisation is one of the key ability at GEMS which allows them to be proactive according to global trends. The company analyses and anticipates this way how future trends effecting its business and products. GEMS fantastic financial performance is due to their ongoing introduction of innovative products and further development of its existing product range.
This continious readjusting of competences is the centre of the learning organisation. Supported by the intuition of GEMS human resources, the acceptence of conflicting ideas within the company and that experimentation becomes the norm. The proactive learning company which is focused on grow and new ways of growing in the future is the basis for GEMS success.
Furthermore it has a superior position compared to competitors already, as all their modalities are number 1 or 2 in worldwide market share. The vital infrastructure, the qualified workforce and the ability to attract talents, several self developed management concepts and the ability to manage acquisitions, the excellent innovation reputation and the strong partnership with customers are supporting GEMS learning organisation approach.
Another factor which is admired by others is its successful acquisition policy. The small innovative companies GEMS is acquiring from time to time and the innovation focused structure itself are adding a kind of entrepreneurial spirit to GEMS despite its company size. Despite this openess to ideas from anywhere and anybody the firm still follows a results-oriented approach.
This spirit keeps the learning organisation alive and ahead of competitors. The main focus is on customer relations which is the value creating factor, but besides there is a strong relationship between different levels and units within the company and to the supplier side as well.
The way GEMS is organised in terms of infrastructure, human resources and technology absolutely benefits marketing, sales and service.
Products are perfectly tailored and priced to customer needs. Achieved through image and reputation of GEMS, but mostly due to its additional services it offers to customers. The core competences as the learning organisation and the ability to manage relationships are fitting perfectly to differentiation as the choice of competitive strategy.
However, environmental forces during the nineties forces GEMS to be more cost effective. Competitive pressure from rivals appeared, e. Moreover there was ever present cost pressure from equipment purchasersfor example managed care organisations, government and employer payers in USA.
Countries with government-sponsored universal insurance systems were introducing reforms to slow down growth of healthcare cost due to state budget restrictions. The movement of COE into low cost countries and the increasing use of suppliers out of low cost countries shows the increasing focus on cost reduction.
Economies of scale became an important factor, but the imaging equipment needs high adaption due to different worldwide customer profiles. The combination of cost effectiveness and local responsiveness became difficult, but GEMS was able to gain economies of scale through standardised components and parts delivered by vendors rather than economies of scale through an often adapted end product.
The ongoing great success proved that GEMS is doing right with following the hybrid strategy approach. A future cost pressure is the increasing importance of biomedical sciences which GEMS is aware of, but margins and the product hit rate are significantly lower in this area.Harvard Business Review Case Study: General Electric Medical Systems () - Marcel Heide - Term Paper - Business economics - Business Management, Corporate Governance - Publish your bachelor's or master's thesis, dissertation, term paper or essay.
GE could be a Harvard Business School case study. Not a day goes by that you don’t read or hear about General Electric (GE). A once great company has fallen from grace.
Jeffrey R. Immelt, Vijay Govindarajan, and Chris Trimble, “How GE Is Disrupting Itself,” Harvard Business Review, October Inside story of the GE Healthcare initiative to overcome “glocalization” and innovate within emerging economies. Find helpful customer reviews and review ratings for Designing World-Class E-Learning: How IBM, GE, Harvard Business School, Thank god, he was there to help Enron communicate issues better to their employees.
See the case study on page 44 "e-learning at Enron". J. MOTA Harvard Business School Rev.
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