GE is no longer as big a company as it used to be, but might as well revive just as IBM did in the 1990s. But for sure, the GE Model is no more. Several reasons exist for the eventual demise of this model. A top contended for this is the Chinese strategy followed not just by China, but also by several other countries, such as Japan, South Korea, India and Brazil. The rise of Silicon Valley is another reason, as it signalled the prominence of software over pure manufacturing which GE represented. At the company’s peak, GE’s practices were widely adopted by business schools for training the MBA students. This led to much replication of the same techniques across the board. Private equity and the new capital markets did not help. These ended up challenging the traditional hegemony of the conglomerates such as GE, demanding greater transparency. Conglomerates still thrive in the developing countries though. The final killer the Great Recession of the previous decade. The spread of professional management, the tech revolution increased competition worldwide and investor power were all fallouts of this recession.

Source:https://hbr.org/2018/07/who-killed-the-ge-model

Uploaded Date:26 August 2019