General Electric SWOT Analysis 2021

General Electric SWOT Analysis 2021

This is an extensive SWOT review for General Electric (GE). The goal is to provide readers with an understanding of some aspects of strengths as well as shortcomings and weaknesses of General Electric. 

The report also highlights various opportunities the company must be thinking about for its future growth, as well as the risks it must come up with strategies to combat. 

General Electric is an American multinational corporation with its headquarters in Boston in the USA.

General Electric SWOT Analysis

About 

General Electric (GE) is a well-known American firm that is considered to be one of the world’s biggest and most varied. 

The company was founded in 1892. was created by the merger of properties of Edison General Electric Company and two other electrical companies.

It has one of the largest brands of consumer electronics and has become a top retailer of various kinds of household appliances under its General Electric and Hotpoint appliance brands.

The company announced it would split into three separate public companies on the 9th of November 2021. 

The new entities will be focused on the energy sector (renewable energy electric power, digital) as well as aviation and healthcare.

Strengths in the SWOT Analysis of General Electric:

General Electric SWOT Analysis

  • Multi-faceted product Portfolio: General Electric has a diverse portfolio that is represented in eight different business segments, including GE Capital, aviation, water, and power as well as oil and gas, lighting, appliances, and healthcare as well as energy management and transportation. The company is diversified in its portfolio that serves a variety of markets across every business segment.
  • Balancing Revenue Stream The diverse portfolio of GE is kept in balance by ensuring that it has the ability to generate balanced revenue streams across all its business units that minimize the risk of being dependent on a single segment of the business. GE Capital is the largest revenue generator, accounting for around 25% of the revenue, while healthcare, aviation, water oil, and gas contribute 10-20% of the revenue each.
  • Strong R&D GE offers a robust research and development division that is known as GE Global Research (GGR) that has a wide range of technologies that covers a variety of fields like electronics, metallurgy, fluid mechanics, among others. The large amount of R&D allows GE to develop new products and to maintain its thought leadership and technological innovation in its field.

Weaknesses in the SWOT Analysis of General Electric:

General Electric SWOT Analysis

  • Legal Procedures: GE has been the subject of several legal proceedings and has increased costs associated with legal compliance for the business. The company has a number of legal proceedings pending in a variety of nations that can impact the financial position of the company and its conditions in these countries.
  • A significant amount of funds borrowed: GE has a substantial amount of debt that affects its operations. The company holds more than $200 billion of long-term debt. A significant portion of cash is spent on interest payments on credit.
  • Dependence on raw material availability: GE is heavily dependent on multiple third suppliers, contract manufacturers, and commodities markets to provide the raw materials. Any disruption to deliveries or discord within the agreement could cause GE’s operations to come to an end and impact the profits.

Opportunities In The SWOT Analysis Of General Electric:

General Electric SWOT Analysis

  • A positive future in future for GE Capital in the US: With US business increasing and the credit card market increasing, GE Capital has a positive outlook for the US. The market in GE capital products is likely to increase and could boost the bottom line.
  • A growing demand in the aviation industry: Air transport industry all over the world is growing and the demand for new aircraft continues to increase. The expansion of the aviation sector benefits the aviation sector of the business, which manufactures and designs commercial aircraft.
  • The growth of the global renewable energy market The prospects for renewable energy are at an all-time high and are predicted to increase further. GE is well-positioned to participate in the development of renewable energy in order to increase its revenue in addition to its market shares.

Threat In The SWOT Analysis Of General Electric:

General Electric SWOT Analysis

  • More tax-related obligations The fact that you are a global business increases the tax-related liability of a brand that is multinational. In the US the policies for business have become more outdated as its rivals have also embraced changes. While other countries have signed trade agreements and promoted growth all over the globe, the US is still lagging in this regard. In other regions of the world, governments are becoming more aggressive when managing a business. India recently introduced tax liabilities that affect both big and small businesses. Additionally, tax laws vary between markets.
  • Changes in geopolitics Changes in geopolitics all over the globe have created major challenges for big brands in the business. Lower oil prices, Ebola, ISIS, terrorist attacks, and other issues are affecting business conditions around the world. These geopolitical shifts have brought tensions that force businesses to seek out new markets.
  • Pressure from the competition – The pressures of competition on businesses have also increased due to a variety of important reasons. The technological revolution has affected companies in a way that has never been seen before. The disruptive nature of innovation has changed business norms, and the advent of the digital age has led to the rise in the form of giants. These factors have led to companies being more competitive in the face of the competition.
  • Pressures from the legal system Law enforcement agencies and government are more aggressive towards business. A tightened legal system has led to less space for greater pressure. Since the terrorist attacks of 9/11 companies in the aviation industry face greater pressure. In other areas, too, legal pressures are greater, including the quality of products and labor laws. Businesses are constantly challenged with legal problems.

Limitations of SWOT Analysis for General Electric

While it is true that the SWOT analysis is used widely as a tool for strategic planning, however, it does have its fair share of drawbacks.

  • Certain abilities or aspects of an organization can be both strengths and weak points at the same. This is among the most important limitations that SWOT analysis has. Changes in environmental regulations can be a threat for companies, but however, it could also be an opportunity in the sense that it allows companies to be in a position to compete with its competitors or even gain an advantage over competitors, if they are could develop their product quicker than competitors.
  • SWOT is not able to show you how to get a competitive edge and therefore it shouldn’t be considered a solution in and of itself.
  • The matrix serves as an initial point of reference for discussions on how the suggested strategies can be implemented. It offered an evaluation window, but not any implementation plan that is based on the Strategic Competitiveness General Electric
  • The SWOT model is a static analysis and analysis of the existing conditions and requires only minor modifications. As the environment, circumstances threats, strategies, and circumstances alter, the dynamic of a competitive setting cannot be analyzed in a single chart.
  • SWOT analysis could cause a company to focus too much on one external or internal aspect when formulating strategies. There are interrelations among important external and internal aspects that SWOT cannot reveal that could be crucial in determining strategies.

Weighted SWOT Analysis of General Electric

Given the previously identified shortcomings of the SWOT analysis/ matrix, the corporate management determined to give the weightage of each of the strengths and weaknesses of the business. 

They also consider the likeliness of events happening in the near future, and the impact they can be on the performance of the company.

This is referred to as weighted SWOT analysis. It is superior to basic SWOT analysis since using weighted SWOT analysis General Electric managers can focus on the most crucial aspects and eliminate the less important ones. 

This also helps solve the long list issue which is when organizations create lengthy lists but not addressing any of the elements is considered to be crucial.

Conclusion

The General Electric SWOT Analysis has demonstrated that the brand has many strengths such as R&D and its place within the industry. 

But, GE also has specific growing weaknesses and threats which must be addressed immediately. 

It’s sufficient to state that GE isn’t going to disappear into the abyss of insignificance at any point in the near future, but it is highly recommended that the brand improve its weaknesses in order to secure a bigger portion in the marketplace.

A SWOT analysis is an important instrument to understand the strategic and internal elements that affect any business. Conducting the SWOT Analysis is a simple but arduous task that requires lots of technical expertise. 

To help you with this we’ve created a sketch of a SWOT analysis, some examples as well as a step-by-step guide to guide you through this procedure. 

You can also create the SWOT chart to present the information in a succinct but comprehensive method.

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