General Electric Company (GE) has a generic competitive strategy that, along with intensive growth strategies, ensures business growth in global markets. Michael Porter’s generic strategies indicate how firms develop and maintain competitive advantages. GE uses its generic strategy for competitive advantages in the aerospace industry. On the other hand, based on the Ansoff Matrix, intensive growth strategies support and sustain business growth. General Electric relies on product development as a major growth factor. The combination of intensive growth strategies in GE’s business facilitates growth despite changing economic conditions and challenges involving competitors, like Rolls-Royce and Pratt & Whitney. These strategies boost business resilience to reach the strategic goals of General Electric’s mission statement and vision statement. For long-term growth and competitiveness, General Electric’s generic competitive strategy and intensive growth strategies remain relevant to industry conditions.
General Electric’s generic competitive strategy and intensive growth strategies determine business tactics and management approaches. For example, GE’s operations management approaches are evaluated based on how they contribute to the competitive advantages and growth of the business. The managerial aims include addressing the external forces coming from General Electric’s competitors and related factors.
General Electric’s Generic Competitive Strategy (Porter Model)
General Electric’s main generic strategy for competitive advantage is differentiation. With this strategy, the company’s goal is to attract target customers to products that are special or unique. These products are made through research and development that GE is known for. For example, the company has advanced research and development processes for products for the aviation industry. Because of its emphasis on research and development, General Electric Company has one of the biggest portfolios of company-owned patents in the United States. Also, this generic competitive strategy involves offering products to many market segments. GE maximizes revenues based on a larger customer base. This generic competitive strategy influences other strategies and tactics in the business, as well as General Electric’s marketing mix or 4Ps. GE aligns its intensive growth strategies with the competitive advantage targets based on strategic differentiation objectives.
One of the strategic objectives in using the generic competitive strategy of differentiation is to intensify General Electric’s research and development programs. This objective supports product uniqueness necessary to capture and retain customers in GE’s target markets. Another strategic objective based on this generic strategy is to strengthen the company’s presence in market segments. For example, General Electric can utilize its competitive advantages to maximize customer loyalty to the GE brand in the avionics market. Moreover, an additional strategic objective is to implement intensive growth strategies that contribute to General Electric’s business growth through product development for the successful application of differentiation as a generic competitive strategy.
General Electric’s Intensive Growth Strategies (Ansoff Matrix)
Product Development (Primary). Product development is the primary intensive growth strategy in General Electric’s business. Growth is achieved through new products or product variants that increase the company’s sales revenues. For example, under this intensive strategy, GE maintains high-productivity research and development processes. These processes ensure a leading edge against competitors in the aerospace industry, thereby supporting business growth and contributing to the strengths identified in the SWOT analysis of General Electric. The generic competitive strategy of differentiation requires that product development must focus on the uniqueness or special features of products. In this regard, a strategic objective based on the intensive growth strategy of product development is to integrate cutting-edge technologies into new General Electric products.
Market Penetration (Secondary). General Electric Company implements market penetration as its secondary intensive growth strategy. In market penetration, the company grows by increasing its customer base in current markets. For example, General Electric applies this intensive strategy through marketing campaigns that aim to add new customers and corresponding accounts. In this way, GE grows its revenue base despite competitive forces. The generic competitive strategy of differentiation enables General Electric to succeed in implementing the intensive growth strategy of market penetration. For instance, through competitive advantages based on product uniqueness and advanced features, GE penetrates the market for jet engines. A strategic objective based on market penetration is to increase General Electric’s aggressiveness in marketing its products against the products of competitors, like Rolls-Royce.
Market Development. General Electric Company implements market development as a minor intensive growth strategy. In this strategy, the company grows through new applications, new markets, or new market segments for its current business or products. For example, this intensive growth strategy is applied whenever GE introduces its aviation technologies for new uses in the transportation sector and creates a new market or market segment, accordingly. However, market development has a minor role in the business because General Electric focuses on advancing products in its current target markets and market segments. The generic competitive strategy of differentiation can facilitate market development for GE products. Differentiation creates competitive advantages that General Electric can use to successfully enter new markets or market segments. A strategic objective based on market development is to create new revenue streams by developing hybrid or new applications of General Electric’s current aerospace products.
Diversification. Diversification is a minor intensive growth strategy in General Electric’s operations. In diversification, growth occurs through new businesses. For example, through this intensive strategy, General Electric entered multiple industries throughout its business history, with operations in the aerospace/aviation, healthcare, electric lighting, energy, and oil and gas industries. However, General Electric, now doing business as GE Aerospace, completed the divestiture of operations other than its aerospace business in 2024. Following this divestiture, diversification has only a minor role in contributing to GE’s growth. In diversification as a growth strategy, General Electric’s competitive strategy of differentiation requires that new business operations involve products that are special or unique. A strategic objective based on diversification is to spread risk across various industries and markets to minimize market-specific risk exposure. Also, the PESTEL/PESTLE analysis of General Electric shows technological factors and other variables that shape industry development and related business growth opportunities. For the growth strategy of diversification, GE searches for such opportunities.
References
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- U.S. Department of Commerce – International Trade Administration – Aerospace Industry.