Case Brief No. 1 – General Electric Medical Systems, 2002
1. What is the underlying logic behind the global product idea? What are the costs and benefits that are expected? GPC’s logic is to concentrate manufacturing and ultimately other activities – wherever in the world to keep the same standards across the boards.
– Maintain the quality and reputation of the product globally - Existing similar operation model to implement in different regions Cost
- Major internal and external strategy shift due to the geographical differences - Resources redistribution
2. Should the global product philosophy be changed or altered to suit the China market? Please identify both sides of the argument and take a position explaining the rationale behind your stand. Does it make economic sense? In my opinion that the global product philosophy should be altered to suit the China market. GE as a top fortune 500 company has own standard operation practice globally. It is hard for the multi-national company to change. The importance of the China market to GEMS was a function of its size and composition. The major developed countries’ markets are either mature or trapped in decade-long economic stasis. China has the largest demand for low-end medical diagnostic products. According to the statistics, demand in China was such that a drop in price 10% could probably raise sales by 50%. It is the right opportunity to succeed in the low end segments. Besides “In China for China” policy, the products produced in China COE could export overseas for other markets.
3. Should GEMS be aggressively pursuing genomics and healthcare-IT related opportunities in addition to or instead of the China opportunity? What priorities would you suggest? Explain your reasoning carefully. GEMS should be aggressively pursuing genomic and healthcare- IT related opportunity as those are the key trends in healthcare. As a major player in the world market, GEMS...
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