Page 1 of 2

Macro Environmental Factors of Ge

Continues for 1 more pages »
Read full document

Macro Environmental Factors of Ge

Page 1 of 2
GE Analysis
a) Political
As a multinational company, General Electric has to deal with political systems of different nations. In spite of some of the countries presenting favorable environment for business survival and growth, others present difficult conditions. Tax systems and regulations also differ across countries and so does the level of government intervention in business activity. For example, in United States, the Internal Revenue Authority requires companies to submit tax returns annually on April 15 (Dibb & Lyndon, 2004). Government intervention is minimal and the business environment is much favorable. Political stability can also be said to be reasonable so that business survival is highly probable. These conditions may not apply in other countries such as China and Singapore where government control over businesses is high. b) Economic

Fluctuations in interest rates, exchange rates and money value greatly affect activities and operations of General Electric. Factors such as deflation and inflation as well as government spending in different countries in which General Electric has ventured often influence business productivity and profitability. The economic impacts caused by the current economic crisis are being felt all over the world. General Electric has recorded decreased sales mostly due to lower lending rates by banks. In addition to that, prices of inputs have also risen considerably. c) Social-Cultural

Norms, culture, religion and social set-ups often determine how a business should conduct itself in a particular country or environment. In the different countries which General Electric has ventured into, the company is faced by different social-cultural challenges which influence its corporate culture to a very large extent. The culture in a particular country determines the working hours, employment policies, procedures for appointing managers and the type of goods to be produced. Similar to other multinational companies, General...