General Electric

see also: Thomas Edison , entrepreneur , Innovation

Role in innovation

Thomas Edison was famous for commercializing the Light Bulb, and for creating the first industrial research lab, which was built in Menlo Park, New Jersey.

Recently, the firm GE has been known as a company specializing in the execution of Innovation, rather than the "fuzzy" idea-generation part. They focus on the practical development of new ideas. As Jeffery Immelt, CEO of GE explains; GE specializes in "turning $50 million ideas into billion-dollar ideas". They use a highly structured process of innovation. He also emphasizes the concept of "fast failing".

More about GE

The General Electric Company, or GE (NYSE: GE) is a multinational American technology and services conglomerate incorporated in the State of New York. In terms of market capitalization, GE is the world's second largest company.

Management excellence:

Why should GE exist as a conglomerate in areas of business that seem unrelated?  Because people trust that the GE Management team is excellent, and that they can leverage their talent to bring more value.

GE Capital business model:

what makes GE capital successful is its unique model in which it relies on being able to borrow money really cheap due to its AAA rating, but it only has this tripply A rating due to its sound industrial units such as jet engines, etc.  This is one of the unique benefits of the conglomerate structure.  Also, since GE capital is a bit more opaque, the company has traditionally been able to make last minute adjustments (buying / selling) in GE Capital to help make price targets for wall street.

History

In 1876, Ohio-born Thomas Alva Edison opened a new laboratory in Menlo Park, New Jersey. Out of the laboratory came arguably the most famous invention of all—a practical 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 made them dominant 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 and still remains after 111 years (it is the only one of the original companies remaining on the Dow - though it has not always been in the DOW index).

In 1911 the National Electric Lamp Company (NELA) was absorbed into General Electric's existing lighting business. GE then established its lighting division headquarters at Nela Park in East Cleveland, Ohio. Nela Park was the world's first industrial park, and was added to the National Register of Historic Places in 1975, and is still the headquarters for GE's lighting business.

The Radio Corporation of America (RCA) was founded by GE in 1919 to further international radio.

General Electric was one of the eight major computer companies through most of the 1960s - with IBM, the largest, called "Snow White" followed by the "Seven Dwarfs": Burroughs, NCR, Control Data Corporation, Honeywell, RCA, UNIVAC and GE. (There was also Scientific Data Systems, much smaller than the seven dwarfs). 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 computer manufacturing 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 reacquired RCA, primarily for the NBC television network. The remainder was sold to various companies, including Bertelsmann and Thomson SA.

In 2002 Francisco Partners and Norwest Venture Partners acquired a division of GE called GE Information Systems (GEIS). 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 Vivendi's television and movie assets, becoming 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 mortgage and life insurance assets into an independent company, Genworth Financial, based in Richmond, Virginia.

Genpact, a BPO company established by GE in the late 90's, was formerly known as GE Capital International Services (GECIS). GE hived off 60% stake in GENPACT to a consortium in 2004. GE is still a major client to Genpact getting its services in customer service, finance and analytics.

For a complete list of acquisitions and divestitures, see General Electric timeline.

Links

Wikipedia article on GE