Case Study GE Financial
Case Study Analysis on GE Capital
Virginia Intermont College
Case Study Analysis on GE Capital
Introduction
General Electric (GE) was formed in 1892 through a merger between Edison General Electric Company and Thomson-Houston Electric Company. GE started acquiring other companies within the area (Eckes, 2001). As a result, management saw this as a business opportunity leading to the formation of a company known as General Electric Contracts Corporation in 1932 (Eckes, 2001). The main purpose was to financially fund the company’s industrial business. The segment continued to grow introducing new products in the market and changing its name to General Electric Capital (GE Capital). GE Capital provides the following financial services: commercial Lending and leasing, and consumer financing. In the last few years, GE Capital has been experiencing difficulties due to the economic crisis. In order to evaluate the challenges, the use of strategic analysis is valuable. Therefore, this paper analyzes how economic crises has affected GE Capital and solutions to the challenges.
Discussion
GE Capital started on a high note! At one point, the company was among the most successful companies in the world getting a triple AAA rating (Grubb and Lamb, 2001). However, in 2008, when there were financial crises, GE Capital began to fail. Stock prices were decreasing at an alarming rate and the company was having difficulties to finance its projects. Additionally, the company profits were decreasing at a worrying rate. The most alarming thing may be that despite being five years into the crisis, the company has yet to fully recover from the challenges (Grubb and Lamb, 2001). For this reason, many people are asking themselves what went wrong and why the company is taking too long to recover. In this case, the use of SWOT analysis and Porter’s five forces to evaluate what happened and find solutions.
Strategic Analysis
SWOT Analysis
Strengths
GE Capital
Virginia Intermont College
Case Study Analysis on GE Capital
Introduction
General Electric (GE) was formed in 1892 through a merger between Edison General Electric Company and Thomson-Houston Electric Company. GE started acquiring other companies within the area (Eckes, 2001). As a result, management saw this as a business opportunity leading to the formation of a company known as General Electric Contracts Corporation in 1932 (Eckes, 2001). The main purpose was to financially fund the company’s industrial business. The segment continued to grow introducing new products in the market and changing its name to General Electric Capital (GE Capital). GE Capital provides the following financial services: commercial Lending and leasing, and consumer financing. In the last few years, GE Capital has been experiencing difficulties due to the economic crisis. In order to evaluate the challenges, the use of strategic analysis is valuable. Therefore, this paper analyzes how economic crises has affected GE Capital and solutions to the challenges.
Discussion
GE Capital started on a high note! At one point, the company was among the most successful companies in the world getting a triple AAA rating (Grubb and Lamb, 2001). However, in 2008, when there were financial crises, GE Capital began to fail. Stock prices were decreasing at an alarming rate and the company was having difficulties to finance its projects. Additionally, the company profits were decreasing at a worrying rate. The most alarming thing may be that despite being five years into the crisis, the company has yet to fully recover from the challenges (Grubb and Lamb, 2001). For this reason, many people are asking themselves what went wrong and why the company is taking too long to recover. In this case, the use of SWOT analysis and Porter’s five forces to evaluate what happened and find solutions.
Strategic Analysis
SWOT Analysis
Strengths
GE Capital
References: Eckes, G. (2001). The six sigma revolution: How General Electric and others turned process into profits. New York, NY: John Wiley. Ferreira, S., Gamertsfelder, A., Hough, C., Rothenberg, S & Sherman, R., (2012). Corporate Analysis: General Electric. University of Pittsburgh. http://rebeccasherman.weebly.com/uploads/1/2/3/3/12338621/ge_corporate_analysis.pdf Grubb, T. M. & Lamb, R. B. (2001). Capitalize on Merger Chaos: Six Ways to Profit from Your Competitors ' Consolidation and Your Own. New York, NY: Simon and Schuster. Warner, A. G. (2010). Strategic analysis and choice: A structured approach. New York, NY: Business Expert Press.