Strategic Planning of General Electric

During the 1980s General Electric’s Chairman, Jack Welch, became highly influential and equally controversial in the world of strategic management. Although Welch focused on gaining competitive advantage for his organization, he also began downsizing and restructuring GE. GE’s strategic planning and operational efforts began a shift toward Total Quality Management and improving productivity. (WriteWork contributors. “Levels of Planning in Management” WriteWork.

com) The 1990s brought about a renewed interest and obsession with strategic planning, as mergers and acquisitions increased in frequency along with a rising rate of complex joint ventures. Such trends focused strategic planning on innovation through decentralized models, leveraging core competencies and emergent strategy. In order to develop a plan, there are several guidelines that need to be remembered. The main goal is to maintain business operations, looking closely at what you need to do to deliver a minimum level of service and functionality is important.

Thus far in the 21st century (2000s), GE’s strategic planning continues towards an orientation of gaining competitive advantage, but with the added dimension of developing and nurturing organizational innovation. As General Electric looks to strategy to help them grapple with issues that include reconciling size with flexibility and responsiveness, planning has grown more complex. This can be attributed in part an increasingly interwoven global marketplace and growing number of competitive forces that have accompanied that change.

Likewise, planning complexity has been affected by the economic woes of the 2000s, which have driven businesses to form many new alliances, partnerships and mergers. The net effect of these changes has resulted in the need for cooperative strategies, resulting in more planning and execution complexity. Additionally, the 2000s have brought about changes in environmental commitments and corporate social responsibility. Within the past several years, GE has been looking into how their strategic planning will help with the ecomagination for the new “greener” products that are a big competition now for the environment.

Faced with the worst economic conditions since the Great Depression, businesses across the board are adapting their behaviors and strategies. GE’s strategic planning has transitioned from a process of trying to predict the future to one of looking backward at what we “know”, examining current-state realities in order to build effective transformation strategies for the future and leveraging lessons learned from the past.