GE was established in 1892 when Edison General Electric merged with Thomson-Houston. The company produced light bulbs,

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GE was established in 1892 when Edison General Electric merged with Thomson-Houston. The company produced light bulbs, elevators, motors, and appliances. Early success came as a result of J. P. Morgan’s financial backing and a focus on research and development. Over the next century, GE evolved into one of the world’s biggest companies, with a diverse portfolio of products and businesses. It is among the largest U.S. companies in terms of revenues and offers an incredible variety of products, from consumer electronics and industrial power to financial services and television broadcasting. Other operating segments include plastics, aircraft engines, and technical products and services for medicine and science. Under the leadership of Jack Welch, who became GE’s CEO in 1981, the company enjoyed two decades of unprecedented growth and prosperity. Welch is widely praised as a visionary business leader due to his performance at GE. He restructured the industrial giant by decentralizing the company’s operations.

He also sought to expand GE’s business with highly profitable ventures and worked to shed low-performing businesses, such as air-conditioning and housewares. This massive restructuring came at a significant cost to GE’s workforce: Between 1981 and 1985, the company cut 100,000 jobs. Once the restructuring was completed, Welch pursued an aggressive acquisition strategy. Some of the major acquisitions included GE’s purchases of NBC Television in 1986 and Kidder, Peabody investment bank in 1990 (which it later sold to Paine Webber). In the 1990s, Welch greatly expanded the historically small GE Capital Services with bank and insurance company acquisitions. GE Capital now operates a diverse range of 27 business, including real estate, insurance, finance, and heavy equipment leasing, and provides more than 40 percent of the company’s revenues. The pace increased between 1997 and 2000, during which time GE averaged more than 100 acquisitions per year. In 1999, GE acquired 134 companies worth $17 billion. In 2000, Welch oversaw the company’s biggest acquisition during his tenure, the $45 billion purchase of manufacturing titan Honeywell International. Today, GE has 49 strategic business units operating under the larger master brand.

Despite its size, the company is able to react to the fast pace of the New Economy. In 2000, the company reorganized GE Information Systems into an e-commerce unit called GE Global Exchange Services and a support unit named GE Systems Services. These two units manage the world’s largest electronic trading community comprised of more than 100,000 trading partners. Additionally, at Welch’s urging, GE employees saved billions of dollars for the company by finding ways to involve the Web in their jobs. The company developed an online network to monitor its manufacturing practices, put its human resources reviews online, and established a 24/7 service center for its plants. Welch sees GE as well positioned to take advantage of the Internet because he thinks content is the easy part of e-commerce while “infrastructure is the hard part, and we have the infrastructure to capitalize on” (McGinn, Daniel, “Jack Welch Goes Surfing,” Newsweek, December 25, 2000). In the 20 years Jack Welch was at GE’s helm, the company prospered tremendously. GE stock rose 3,098 percent between April 1981 and February 2001, compared with 896 percent growth for the S&P 500 during that same period. Once Welch named his successor—Jeffrey Immelt, head of GE’s medical imaging business—in November 2000, analysts wondered what effect the change would have on the company. Immelt, like Welch, has professed dedication to the Internet. He describes it as “a transformational technology that is right in our sweet spot” (Useem, Jerry, “Meet ’Da Man,” Fortune, January 8, 2001). What remains to be seen, though, is whether Immelt will conduct GE through a period of prosperity the way Welch has. Source: Kotler, P (2003). Marketing Management Electronic Resource (11th Edition). Pearson Education: Upper Saddle River, New Jersey.

QUESTION 1 (20 Marks) Marketing appeared to be an important part of Jack’s Welch strategy at GE. Discuss the marketing concept and indicate where and how Jack Welch applied these marketing concepts to achieve GE’s organizational goals.

QUESTION 2 (20 Marks)

2.1. Identify the stage at which GE is in the product life cycle. Justify your answer. (4 marks)

2.2. Identify the characteristics of this phase of the product life cycle. (8 marks)

2.3. Discuss fully the marketing strategies that may be implemented during this phase of the product life cycle. (8 marks) SECTION B [60 MARKS]

QUESTION 3 (20 Marks) As the owner of Concept Clothing, which sells trendy and imported women’s clothing, a successful business in the clothing industry in your country. Mr Smith your high school friend, who is planning to launch his clothing outlet in another country, recently met you in a trade show and will like you to explain to him how the variables in the macro and micro environment may influence his business. Identify and explain all the macro variables that will influence his business.

QUESTION 4 (20 Marks)

4.1. Explain the importance of marketing information and its understanding of the marketplace to a company. (10 marks)

4.2. Discuss the different ethical and policy issues that marketing researchers may face when undertaking research studies. (10 marks)

QUESTION 5 (20 Marks) One of the hardest marketing decisions facing a company is how much to spend on promotion. As the marketing manager of a shoe outlet, discuss the various methods that are generally used in setting a promotional budget, along with the pros and cons. Which method would you use in setting the promotional budget of the shoe outlet and state why you would choose this method?

QUESTION 6 (20 Marks) Using appropriate examples discuss the six broad types of innovation Strategies the Company can adopt in new product development.