General Electric is a multinational conglomerate corporation which began its journey with the control over the electric industry during the late 19th century and continued to grow significantly. Thomas Edison, creator of the light bulb, was one of the original founders of General Electric. By 1890 he had built up a number of separate businesses and pulled them together to make Edison General Electric. At the same time Charles Coffin was buying up many of the key patents in the electric industry to create the Thomson-Houston Company. They had difficulty competing with each other because each had the rights to different patents. In 1892 the two companies merged to create General Electric, one of the original twelve companies first listed on the Dow Jones.
One of the key factors that led to the success of General Electric was their deep investments into research and development. From the start they employed scientists and engineers to develop new technology and products. Charles Coffin stated "It does seem to me therefore that a Company as large as the General Electric Company, should not fail to continue investing and developing in new fields: there should, in fact, be a research laboratory for commercial applications of new principles, and even for the discovery of those principles. General Electric controlled 75% of the American electrical industry during the mid-1980s and worked with their major competitor, Westinghouse, to fix incandescent lamp prices to prevent competition lowering their sales. Coffin created a scheme in 1901 that would allow General Electric to dominate the lamp market completely. To avoid breaking the Sherman Antitrust Act General Electric would have their partners of the Sunbeam Incandescent Lamp Company buy out most of the independent manufacturers. They created the National Electric Lamp Company which ran 18 subsidiaries that continued to operate under their original company names to make it appear like they were still independent. With General Electric controlling National's company they were able to dominate the electricity industry throughout most of the 20th century.
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General Electric did not limit itself to electricity; it became so large and diverse that it branched out into divisions just to manage each area. The five major segments include Energy Infrastructure, Technology Infrastructure, NBC Universal, Capital Finance and Consumer & Industrial. Each unit of the corporation has been very successful on their own, many listed in the Fortune 500. One example of this is the acquisition of RCA. They acquired the Radio Company of America (RCA) in 1919 as its retailer for radio sales. RCA was dropped from General Electric in 1930 but would go on to become a massive corporation on its own. General Electric required RCA in 1986 for the rights to the NBC television network, and later in 2004 gained 80% control of NBC Universal. General Electric is responsible for creating thousands of products ranging from computers and refrigerators to wind turbines and jet engines.
In 2001 Jeffrey Robert Immelt was selected to become the CEO of General Electric following Jack Welch's retirement. Immelt was born and raised in Cincinnati, Ohio and from a young age he was close to General Electric as his father managed the General Electric Aircraft Engines Division. He worked in a Ford Motor assembly plant while studying Applied Mathematics in Dartmouth College and Harvard Business School. Since 1982 he has been employed by General Electric while on the board of two non-profit organizations. He worked his way up from district sales manager to VP of General Electric Appliances. During that time he faced a major recall of millions of refrigerators. Using his managerial skills he earned the respect of the workers through motivational speeches he gave at the factory from a forklift. In 1997 he became the president and CEO of the Medical Systems division and helped lead the division to revolutionary mammogram technologies and the world's fasted CAT-scan machine into mainstream medical.
Immelt became CEO during a difficult time. He took over on September 7, 2001 just several days before the 9/11 terrorist attacks which resulted in a $600 million loss from General Electric's insurance business as well as having an effect on the companies Aircraft Engines division. He has also been CEO during this recent recession which has hurt everyone. Stock prices have gone down significantly since he began. During 2008 the value of General Electric's stock dropped by nearly half of what it was the prior year. That year Immelt declined to take any bonus compensation, unlike most CEO's who would take the money without hesitation. He may not have much success with the corporation's financial status during the recession but he has kept it afloat and helped with the innovation of new ideas. Immelt has always held true to the belief that innovation through research and development is the key to a successful organization, not greed. He has been very outspoken about this belief during the recession blaming modern business for ruining the economy. "Less money has been invested in research and development and manufacturing, with more of a transition to financial services. When a country from 1980 to 2010 goes from being an export powerhouse to an unbelievably consumption-driven net importer, that's not a good trend." (Kirby, 2010).
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During Immelt's time in office General Electric was criticized for its environmental pollution. Nearly 4.4 million pounds per year of toxic chemicals were being released from their facilities. In 2005 Immelt announced plans for "Ecomagination" which aimed to redesign the corporation to be environmentally friendly. The plan was first tested in a Chinese branch where they noticed a 50% increase in sales after a switch to "green" products (Gwynne, 2010). General Electric invested $1.4 billion a year into the research and development of clean technology. This represented nearly a third of their R&D investments. The development paid off as the research began to yield profitable technologies such as wind turbines and water recycling advances. Such advances were used in a water recycling plant in Arizona that increased productivity from 4.5 million to 9 million gallons recycled daily.
Immelt began developing his interpersonal skills when he was just a young boy. As a high school basketball player he told his coach to yell at the team less often so the players would be more self confident. While working in the Ford Motor assembly plant he learned a lot about how to communicate to people, what makes them respond. He acquired all the technical skills from studying Mathematics in Dartmouth and Harvard and developed them further through working with several different divisions of General Electric to diversify his skills. Immelt was chosen to lead the corporation as a CEO because of his leadership skills that would help motivate the employees to fuel the corporation's success. He has led the corporation under the same idea of its founders. The idea that money should be used towards researching and developing newer, more efficient technologies that will power future generations. Immelt understands that General Electric should be more concerned with helping create a better future rather than looking at profits when he said "We want to be a company that is always getting better. A company that understands where it fits in the market and society and appreciates its responsibility to both."
"I'm out talking about this company seven days a week, 24 hours a day, with nothing to hide. We're a 130-year-old company that has a great record of high-quality leadership and a culture of integrity." - Jeff Immelt, Chairman and CEO. Of the original twelve Dow Jones companies General Electric is the only one remaining. General Electric has been one of the most influential corporations and an example of America's economic strength. Since its incorporation in 1892 they have generated trillions of dollars in revenue, created thousands of jobs for Americans, and funded research that allowed for this country to be where it is today. While the corporation may not be as successful today as it was 60 years ago, it is still going strong under the leadership of Jeffrey Immelt. He has led the corporation through a very difficult recession and still managed to maintain revenue and a good image for the corporation. Although the future of General Electric may be shaky it is safe to say they will be around for a better part of this century.
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