Areas of Operation and Main Trading Links of GE - Essay Example

A company profile for a company Contents Contents 2 Company structure and organization 3 Main product 4 Areas of operation and main trading links 5 Financial structure 7 Training provision 8 References 9 Company structure and organization Figure 1: Organizational chart (G.E., 2014) The organization that has been chosen for this study is GE. GE is a global conglomerate spanning over many sub divisions. Some of its sub divisions are large enough to be themselves counted in the fortune 500 list. Since the company deals with different sectors the company is subdivided in its operations into 6 divisions. Each of these divisions looks after particular industry. The company follows a divisional organizational structure with the company divided into 9 different divisions. Divisional organization structure actually gives more autonomy to the divisions and allows them to function in their own way (Ketchen, and Short, 2012). In other words this type of structure facilitates decentralization. The corporate staffs at GE are divided into 5 sub divisions. The key subdivision of the corporate staff at GE are Commercial public relations, Legal, Global research, Human resource and Finance. The organization structure of GE shows that it is headed by the corporate executive office. They are in turn supported by shareowners and board of directors. The corporate executive office in turn elects a chairman and CEO. In 2014 the total no. of employees who worked in GE are 307,000. In 2014 the chairman and CEO of the company was Jeffrey R. Immelt. In 2014 GE had 2 vice presidents namely Keith S. Sherin and John G. Rice. They were additionally holding the post of president and CEO of GE capital and Global growth and operations respectively. The president and CEO of other divisions was namely Charles Bankenship for appliances and lighting division, John L Flannery of healthcare division, David L. Joyce of GE Aviation, Russell Stokes of GE transportation, Stephen R. Bolze for GE power and water, Lorenzo Simonelli for Oil and Gas division and Mark W. Begor for GE energy management. Main product GE has many divisions and manufactures several things. In fact GE is a conglomerate of several divisions. The various subdivisions of GE are capital, appliances and lightning, healthcare, aviation, transportation, power and water, oil and gas, energy management and Global growth and operations. The main products that GE thus manufactures are lighting appliances. In the power, water, oil and gas sectors too GE is the leader as GE provides power, water, oil and gas. GE aviation is a subsidiary of the general electric and is one of the major suppliers of aircraft engines for the commercial aircrafts that operate. The major competitors of GE aviation are Rolls-Royce and Pratt and Whitney. GE aviation is amongst the top aircraft engine suppliers. GE healthcare is also a subsidiary of GE. GE healthcare provides transformational medical technologies that are used to serve patients across the world. GE healthcare designs and provides new technologies in medical diagnostics, medical imaging systems, patient monitoring system drug discovery etc. GE transportation is another subsidiary of GE. The company specializes in manufacturing equipment that is required for rail, marine, mining, drilling and energy generation industry. The company has its headquarters in Chicago and its manufacturing hub in Erie, Pennsylvania. The company announced that it had to build a second factory in Texas in order to meet increasing demand. Areas of operation and main trading links Figure 2: GE global scale of operations (Rudarakanchana, 2014) GE is a multinational conglomerate having its operations spread across the globe. The company is particularly registered in USA. And has its operations spread across globe. The company has its offices registered in different countries across the globe. As of 2014 the company reported that it drew revenues of more than $1 billion from each of 24 different countries that it operated. In 2013 6 new countries in which GE operated reached that threshold level of sales figure of $1 billion. GE is a conglomerate having market capitalization of $268 billion. It ranks amongst top 10 in global fortune 500 listing of companies. The countries in which its sales figure touched $1 billion included two countries from the developed markets of Europe that is Norway and Switzerland. Other 4 countries which were new entrants to the list were Thailand, Indonesia, Turkey and Algeria. The company has 7 product divisions which makes it a conglomerate. The operations of the company are spread over the fields of aviation, healthcare, finance, transportation, power & water and oil and Gas. There are two other two divisions that are energy management and global growth and operations. Figure 3: global growth of GE (Beccalli, 2012) The company does not publish sales figure by country basis and only publishes the data on region basis. In the growth markets the company showed a growth rate of about 12% compounded annually. Amongst the growth markets the companies that are rich in resources cumulatively showed an annual growth rate of 10%. In the developed market the company grew at the rate of 3% annually. Figure 4: revenues by geographies (Beccalli, 2012) Financial structure Debt to equity 2014     Total debt 200,414,000 (Yahoo finance., 2015) Total Equity 128,159,000 Debt to Equity 1.56 The debt to equity of the company is 1.56. This means that the company has more share of debt in its capital structure as compared to the share of equity in the capital structure. This makes the company more prone to risk as debt increases the risk of the company. Debt to asset 2014     Total debt 200,414,000 Total asset 648,349,000 Debt to Asset 0.31 The debt to asset ratio for the company is 0.31 that means that the company’s debt is only a fraction of the asset of the company. This means that if the need arises the company can pay its debt obligation through its assets. Fixed asset turnover 2014     Revenue 148,589,000 Fixed asset 72,687,000 Fixed asset turnover 2.04 The fixed asset turnover of the company is defined as the revenue divided as the ratio of the revenue of the company to the fixed asset of the company. The ratio measures how efficient the company is in using its fixed asset in generating its revenue. The company is quite efficient in converting its fixed asset turning into revenue. The fixed asset turnover ration of the company is 2.04. Total asset turnover 2014     Revenue 148,589,000 Total asset 648,349,000 Total asset turnover 0.23 The total asset turnover of the company measures the ratio of the revenue of the company to the total assets of the company. The total asset turnover ratio measures how efficient the company is in using the total asset of the company in generating revenue for the company. The total asset turnover ratio of the company is about 0.23. That is the total asset of the company is greater than the revenue of the company. So the company cannot be said to be efficient in using its total assets in generating revenue. Training provision GE believes that learning helps their employees to develop and enables them to take on bigger challenges. The company provides training to the employees so that they can take leadership roles in future. The company believes that learning is essential to the success of the individuals working at a company, allowing them to develop new skills, new initiatives and increase the leadership capabilities of the people. GE provides adequate training to the employees in order to develop them to take on future leadership roles. GE has a corporate B school that provides training and provides learning opportunities to the employees in order to develop and train them to develop excellence in leadership. GE has various types of leadership program for its employees that cater to the diverse requirement of the employees and also the diverse skill set of the employees. The various courses that it has are leadership essential course, executive development and cornerstone leadership. Some of the courses offered are foundation courses, leadership development courses, new manager development course and advanced manager course. References Beccalli, N., 2012. GE global growth and operations: Germany. [Online]. Available at < http://www.ge.com/sites/default/files/ge_ubs_industrial_leadership_presentation_05042012_0.pdf > [Accessed 23 March 2015]. G.E., 2014. G.E. company organizational chart. [Online]. Available at < http://www.ge.com/pdf/company/ge_organization_chart.pdf > [Accessed 23 March 2015]. Ketchen, D., and Short, J., 2012. Strategic Management: Evaluation and Execution. [Online]. Available at < http://2012books.lardbucket.org/books/strategic-management-evaluation-and-execution/s13-executing-strategy-through-org.html > [Accessed 23 March 2015]. Rudarakanchana, N., 2014. General Electric (GE) Goes Global: Revenues Over $1bn From 24 Countries. [Online]. Available at < http://www.ibtimes.com/general-electric-ge-goes-global-revenues-over-1bn-24-countries-1543533 > [Accessed 23 March 2015]. Yahoo finance, 2015. General Electric Company (GE). [Online]. Available at < https://in.finance.yahoo.com/q/bs?s=GE&annual > [Accessed 23 March 2015]. Read More