Encyclopedia
The
General Electric Company, or
GE is a multinational
American technology and
services conglomerate. According to the Forbes Global 2000 it is the world's second-largest company.
It is different than
The General Electric Company plc, which was renamed
Marconi plc in 1999.
In the 1960s, aspects of U.S. tax laws and accounting practices led to a rise in the assembly of conglomerates. GE, which was a conglomerate long before the term was coined, is arguably the most successful organization of this type.
History
In 1876,
Thomas Alva Edison opened a new
laboratory in
Menlo Park,
New Jersey. Out of the laboratory was to come perhaps the most famous invention of all—a successful development of the
incandescent electric lamp. By 1890, Edison had organized his various businesses into the
Edison General Electric Company.
In 1879, Elihu Thomson and Edwin J. Houston formed the rival Thomson-Houston Electric Company. It merged with various companies and was later led by Charles A. Coffin, a former shoe manufacturer from
Lynn, Massachusetts. Mergers with competitors and the
patent rights owned by each company placed them in dominant positions in the electrical industry. As businesses expanded, it became increasingly difficult for either company to produce complete electrical installations relying solely on their own technology.
In 1892, these two major companies combined, in a merger arranged by financier
J. P. Morgan, to form the General Electric Company, with its headquarters in
Schenectady, New York.
In 1896, General Electric was one of the
original 12 companies listed on the newly-formed
Dow Jones Industrial Average. GE is the only one that still remains today.
In 1911 the National Electric Lamp Company was dissolved and absorbed into General Electric's existing lighting business. At this time GE established its lighting division headquarters at
Nela Park located in
East Cleveland, Ohio. Nela Park was the first industrial park in the world, was added to the National Register of Historic Places in 1975, and today still serves as the functional headquarters for GE's lighting business.
The
Radio Corporation of America was founded by GE and
American Telephone & Telegraph in 1919 to further international
radio.
Between 1927 and 1935, 52 different inventions in electricity were introduced to the company by Hassan Kamel Al-Sabbah.
General Electric was one of the eight major
computer companies through most of the 1960s - with
IBM, the largest one, being called "Snowy White" followed by the "Seven Dwarfs":
Burroughs, NCR, Control Data Corporation,
Honeywell,
RCA,
UNIVAC and GE itself. . GE had an extensive line of general-purpose and special-purpose computers. Among them were the GE 200, GE 400, and GE 600 series general purpose computers, the GE 4010, GE 4020, and GE 4060 real time process control computers, and the Datanet 30 message switching computer. A Datanet 600 computer was designed, but never sold. It has been said that GE got into the computer manufacturing business because in the 1950s they were the largest user of computers outside of the
United States federal government. In 1970 GE sold its computer division to Honeywell.
In 1986, GE re-acquired RCA, primarily for the NBC television network. The rest was sold to various companies, including
Bertelsmann and
Thomson.
In 2002, Francisco Partners and Norwest Venture Partners acquired a division of GE called GE Information Systems . The new company, named
GXS, is based in Gaithersburg, MD.
GXS is a leading provider of B2B e-Commerce solutions. GE maintains a minority ownership position in
GXS.
In 2004, GE bought the television and movie assets of
Vivendi Universal and became the third largest media conglomerate in the world. The new company was named
NBC Universal. Also in 2004, GE completed the spinoff of most of its life and
mortgage insurance assets into an independent company, Genworth Financial, based in
Richmond, Virginia.
- For a complete list of acquisitions and divestitures, see General Electric timeline.
Today
GE is an enormous multinational conglomerate headquartered in
Fairfield, Connecticut. The company describes itself as composed of a number of primary business units or "businesses." Each "business" is itself a vast enterprise, many of which would, even as a standalone company, rank in the Fortune 500. The list of GE businesses varies over time as the result of acquisitions, divestitures and reorganizations. General Electric's tax return is the largest return filed in the United States, spanning approximately 24,000 pages when printed out. Electronically, the files were 237 megabytes.
In 2005, GE launched its "
Ecomagination" initiative in an attempt to position itself as a "green" company. Currently the company is one of the biggest players in the wind power industry and also developing new environment friendly products such as hybrid locomotives and photovoltaic cells. The company has also set goals for its subsidiaries to lower their greenhouse gas emissions.
Controversy
GE has faced considerable controversy and legal battles relating to its business operations. This has included numerous legal proceedings relating to environmental pollution.
In 1983,
New York State Attorney General Robert Abrams filed suit in Federal District Court to compel GE to pay for the clean-up of what was claimed to be more than 100,000 tons of chemicals dumped from their plant in Waterford.
In 1999, the company agreed to pay $250 million to the United States, Massachusetts, and Connecticut to resolve claims it polluted the Housatonic River with
PCBs and other hazardous substances.
GE has also faced criminal action regarding its defense-related operations. GE was convicted in 1990 of defrauding the U.S. Department of Defense, and again in 1992 on charges of corrupt practices in the sale of weaponry to Israel.
GE businesses
- Main article: List of assets owned by General Electric
- GE Commercial Finance
- Capital Solutions
- Corporate Financial Services
- Healthcare Financial Services
- Insurance
- Real Estate
- GE Industrial
- Advanced Materials
- Consumer & Industrial
- Equipment Services
- GE Fanuc Automation
- Inspection Technologies
- Plastics
- Security
- Sensing
- GE Infrastructure
- Aviation
- Aviation Financial Services
- Energy
- Energy Financial Services
- Oil & Gas
- Transportation Systems
- Water
- GE Money also known as GE Consumer Finance
- GE Healthcare
- NBC Universal
- Network
- Films
- Television Stations
- Entertainment Cable
- Television Production
- Sports/ Olympic Games
- Theme Parks
Through these businesses, GE participates in a wide variety of markets including the generation, transmission and distribution of
electricity,
lighting, industrial
automation, medical imaging equipment,
motors,
railway locomotives,
aircraft jet engines,
aviation services and materials such as
plastics,
silicones and abrasives. It was co-founder and is 80% owner of
NBC Universal, the National Broadcasting Company. Through GE Commercial Finance, GE Consumer Finance, GE Equipment Services, and GE Insurance it offers a range of financial services as well. It has a presence in over 100 countries.
Since over half of GE's revenue is derived from financial services, it is arguably a financial company with a manufacturing arm. It is also one of the largest lenders in countries other than the United States, such as
Japan. Even though the first wave of conglomerates fell by the wayside by the mid-1980s, in the late 1990s, another wave tried and failed to emulate GE's success.
GE's brand
General Electric has one of the most valuable corporate brands in the world. CEO Jeffrey Immelt had the new brand commissioned in 2004, after he took the reigns as chairman, in order to unify all the diversified businesses of GE. The brand included a change of the corporate color palette, small modifications to the
, a new customized font, called
GE Inspira, and a new slogan,
"imagination at work" replacing the longtime slogan
"we bring good things to life". The new brand requires many headlines to be lowercased and adds visual "white space" to their documents and advertising to promote an open and approachable company. The new brand was designed by Wolff Olins and is used extensively on GE's marketing, literature, and corporate website. GE BrandCentral is a website dedicated to managing the brand and requests for font and logo usage. It is closed to the public.
Jack Welch
The CEO from 1981-2001 was
Jack Welch, who many regard as one of the premier business managers of his era. Nicknamed "Neutron Jack", he presided over a 28-fold increase in earnings with his policy of sacking the worst performing 10% of his staff every year. In running GE's many diverse businesses he maintained a policy of only keeping those businesses which were #1 or #2 within their respective industries. In 1987, GE was the United States' second largest
nuclear power company and third largest producer of
nuclear weapons systems. Jack Welch introduced the use of the
six sigma quality system, originally developed at
Motorola, within GE.
For more on
Jack Welch, see his book "Straight From the Gut."
Corporate information
In 2004, GE was named number one company for employers and employees on the
Forbes 500 Global Player list.
Jeffrey Immelt succeeded
Jack Welch as CEO of General Electric and holds that office today. Current members of the board of directors of General Electric are: James Cash, Jr., Sir William Castell , Ann Fudge, Claudio Gonzalez, Jeffrey Immelt, Andrea Jung, A.G. Lafley, Robert Lane, Ralph Larsen, Rochelle Lazarus,
Sam Nunn,
Roger Penske, Robert Swieringa, Douglas Warner, and Bob Wright.
Over the years, GE has received several awards honoring them for their accomplishments, values and reputation:
- In Fortune Magazine's 2005 "Global Most Admired Companies" list, GE ranked first overall.
- In Fortune Magazine's 2005 "America's Most Admired Companies" list, GE ranked second overall.
- GE was named to the Dow Jones Sustainability World Index as one of the world's leaders in environmental, social and economic programs.
- GE ranked ninth on Fortune Magazine's "50 Most Desirable MBA Employers" list.
Superfund sites
General Electric has agreed to pay the
Environmental Protection Agency to clean up three
superfund sites contaminated with
polychlorinated biphenyls . The three superfund sites are composed of a 200 mile stretch along the
Hudson River, a section of the Housatonic River in
Pittsfield, Massachusetts and a transformer facility near
Rome, Georgia.
Analyst coverage
See
- Germanotta, Jeffrey
- Cornell, Robert
- Parent, Nicole
- Dray, Deane
Financials
See also
- Borazon
- Lexan
- List of assets owned by General Electric
- MOOSE
- Rank and yank
References
External links
