Competitive advantage involves constructive strategies made in the business institution in the pursuit of competitiveness and prosperity. The institution has to create conducive environment for productivity growth. In the “GE’s Two-Decade Transformation: Jack Welch’s Leadership”, competitive advantage is utilized through his exemplary leadership. This paper examines ways and strategies deployed by Jack Welch when he was the CEO of the General Electric Company in enhancing the company’s performance. It also highlights reasons as to why a large organization needs to remain adaptable.
General Electric Company was a company in the United States that dealt with power generation, distribution and use of electric power. Its service to the customers made the company to be admired by many. It was once regarded as the best company preferred by many under the leadership of Jack Welch (Resetarits Jr, 2002). Jack deployed competitive advantage to make the company prosper. As competitive advantage entails developing strategies that enable a company to achieve its goals, Jack allowed several ways that enhanced the General Electric Company to succeed in increasing its productivity. These strategies include: extensive cost cutting, removing the less performing processes and reducing the number of employees. By creating a competitive advantage over other companies, Jack reduced prices of many products in order to draw the most customers into the company. This strategy became effective as most products were sold due to increased customers.
Creating competitive advantage involves focusing on products that are on demand and reducing those that are less demanded by customers. Jack used this technique where he removed the less demanded processes such as air conditioning and consumer electronics and focused on products and processes that were profitable and marketable such as dealing with mechanical engines like aircraft engines, turbines and medical tools. This enabled the company to supply most of its goods and get profits. This strategy was advantageous that it enhanced the company’s performance. He focused on financial operations and entertainment. Financial operations included providing services to customers that included transactions. This way drew more customers to the company because the services provided to suit their needs. Introduction of entertainment industry played a nice role in the General Electronic Company as it further threw more customers into the company and enjoyed the services and products offered. This led to the improvement of the company due to the increased profits (McKee, Rajan Varadarajan & Pride, 1989).
As creating competitive advantage involves employee management, Jack played an effective role when he reduced the number of employees in a less and productive number (Bartlett & Wozny, 1999). This enabled the company to reduce its spending on employees’ salary and promote competence among them. He did this through removing some employee positions which did not play major duty in the company.
The aspect of the overall management of a business is one way of creating competitive advantage. It is evidently noticed that Jack as the Chief Executive Officer, used his position to review the company’s processes and development and provided continuous changes in the company that suited the demands of customers and market of the products offered in the company. It is the responsibility of any manager to implement strategies that constantly change in the company to enhance its performance. The introduced strategies are therefore supposed to be deployed in the company to provide adaptability to the customers. It is clear that Jack used his position well to accommodate competitive advantage in the General Electronic Company. These strategies deployed by Jack shows that large institutions have to remain adaptable by employees and even the customers (Cosco, 1994).
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In conclusion, it is clear that competitive advantage involves the use of strategies that are not common to improve company’s performances. These strategies enable the company to prosper. General Electric Company became successful in its business under the leadership of Jack, who emphasized on the use of these strategies to achieve the competitive advantage.