Columbia/HCA Healthcare Corp
Business Level Strategy
The business level strategy of GE in times past has been concentrated on providing heath care equipment to approximately 300 hospitals that were run by Columbia/HCA Healthcare Corp.But GE, run by Welch, has diversified greatly.Moving from a primarily manufacturing firm to becoming a more service oriented firm.One of the first big steps for GE to move into the services market was when Columbia allowed them to service all of their imaging equipment, including those made by GE’s rivals.
The strategy of differentiation for GE is in their vision of improving the quality of their products and services.Welch decided earlier this year to improve GE quality with the expectation of boosting their revenues.
Overall Cost Leader
GE is already seeing a competitive advantage in streamlining their organizations that reduce operating costs and increasing revenues.In fact, they have done this so well that other organizations have been willing to hire GE as a consultant to show them the tricks of the trade that will increase their bottom lines.GE has been offering flat rate full service contracts for many of its customers that are raising the eye brows of competitors.
The focus for Welch has been directed on GE and GE alone.It was stated that he doesn’t sit on any outside corporate boards and is devoted to the success of GE.
GE is definitely categorized as a prospecting type of company.As the article outlines, GE is a company that looks for new markets and new growth opportunities and is willing to accept some level of risk.Along with successfully being involved in Medical Systems, Aircraft Engines, Power Generation, and Transportation, GE has been busy working on global computer services that appears to have phenomenal potential for them.
Corporate Level Strategy
As all of GE’s business entities get direction from Welch on a business level strategy, he has come up with a corporate level strategy that has his competitors guessing what next?Welch appears to have enough vision to see what industry is doing as a whole and not just what the manufacturing industry is doing.This vision has driven his company to seek out opportunities that are more service orientated.
The diversification of GE in recent years tends to make one believe that GE does not concentrate on just one thing.But GE has concentrated on manufacturing as its primary task in the business world.But Welch has changed that task to providing services.A company that can effectively provide a product and then turn around and be the sole service provider for that product will seemingly be in a position to where its competitor cannot touch them.
Penetration – GE has been able to increase its customer base by providing a complete package that includes products and services at flat or lower cost.
Expansion – GE is also expanding into new areas, such as providing services for its existing product line along with the product line of its competitors.GE is also working on becoming a service provider for corporate computer networks around the world.This would put them in direct competition with IBM and EDS, companies that were not seen as competitors in the past.
GE has been very strong in the international market in the past but is positioning itself with a much broader dominance by implementing a variety of services for companies abroad.
Horizontal ; Vertical Integration
Horizontally, GE is not carving away at its competition all that much, but it wants to become much more vertical in different areas of the international business world.For whatever business GE is in, it wants to be able to dominate it from the top down.This vertical expansion goes forward as well as backward.If GE is unable to buy a given reseller or supplier it makes sure that the contract states that its customer must go through them for all aspects of the business. (i.e. products and services)