New Financial And Statistical Measures To Monitor The Success Of Ge :: essays research papers

New Financial and Statistical Measures to Monitor The Success of GETo      The identity card of Directors, GENERAL ELECTRIC COMPANYSubject NEW FINANCIAL AND STATISTICAL MEASURES TO MONITOR     THE SUCCESS OF GENERAL ELECTRIC COMPANY     After Mr. Weltch proclaimed my bare-ass assignment, I pondered how I could goabout guaranteeing the best possible result a creditable and well organizedwork that is going to uphold you, the mount of Directors, plan for the future ofthe company in a better way. Before starting my analysis, I must specify thatmy target is not to overthrow the traditionally used financial and statisticalmeasures but to develop sunrise(prenominal) ones to be used as guidance for the corporationsfuture development.Our Chairman recently wrote that "the hottest burn in business in 1995-- and the one that hit closest to home -- is the rush toward breaking up multi-business companies and spinning off the ir components, under the theory thattheir surface and diversity inhibited their competitiveness ... breaking up is theright answer for some big companies ... for us it is the wrong answer.1 For usthe new curve is the entrance into the service industry. The question must thenbe is this the right answer?     GE is expecting to increase its revenue by the year 2000 to $long hundred megcompared with $58 billion in 1990. In other words, if the forecast proves to becorrect, it will obtain an average annual number of growth of 7.5%. This lavishlyrate is mainly attributed to the expansion of the services sector of the company,which is estimated to increase by an average annual rate of 13% compared with acorresponding one of 2.1% for manufacturing. directly nigh 60% of GEs profitscomes from services -- up from 16.4% in 1980.2     This is our new direction and therefore my target is to find thesemeasures that are going to help us ensure how the business is going toperform in that particular field. I also consider that our attempt to expandinternationally is extremely important and in a way is something new for us.International operating profit was $3.0 billion for 1995 compared with $2.3billion in 1993.3 This extremely rapid expansion hides a lot of dangers, and atthe like time shows another new "trend" of our corporation. In my analysis Iwill include the international sector. I will also contract in on employees,stockholders, goodwill and on potential investors.     1) MIEC (Manufacturing Industry Expenses Comparison)     As we know, the basic organization of the company s continuingoperations consists of 12 find businesses, which accept management units ofNew Financial And Statistical Measures To Monitor The Success Of Ge essays research papers New Financial and Statistical Measures to Monitor The Success of GETo      The Board of Directors, GENE RAL ELECTRIC COMPANYSubject NEW FINANCIAL AND STATISTICAL MEASURES TO MONITOR     THE SUCCESS OF GENERAL ELECTRIC COMPANY     After Mr. Weltch announced my new assignment, I pondered how I could goabout guaranteeing the best possible result a creditable and well organizedwork that is going to help you, the Board of Directors, plan for the future ofthe company in a better way. Before starting my analysis, I must specify thatmy target is not to abolish the traditionally used financial and statisticalmeasures but to develop new ones to be used as guidance for the corporationsfuture development.Our Chairman recently wrote that "the hottest trend in business in 1995-- and the one that hit closest to home -- is the rush toward breaking up multi-business companies and spinning off their components, under the theory thattheir size and diversity inhibited their competitiveness ... breaking up is theright answer for some big companies ... for us it is the wrong answer.1 For usthe new trend is the entrance into the service industry. The question must thenbe is this the right answer?     GE is expecting to increase its revenue by the year 2000 to $120 billioncompared with $58 billion in 1990. In other words, if the forecast proves to becorrect, it will obtain an average annual rate of growth of 7.5%. This highrate is mainly attributed to the expansion of the services sector of the company,which is estimated to increase by an average annual rate of 13% compared with acorresponding one of 2.1% for manufacturing. Today nearly 60% of GEs profitscomes from services -- up from 16.4% in 1980.2     This is our new direction and therefore my target is to find thesemeasures that are going to help us understand how the business is going toperform in that particular field. I also consider that our attempt to expandinternationally is extremely important and in a way is something new for us.Internation al operating profit was $3.0 billion for 1995 compared with $2.3billion in 1993.3 This extremely rapid expansion hides a lot of dangers, and atthe same time shows another new "trend" of our corporation. In my analysis Iwill include the international sector. I will also narrow in on employees,stockholders, goodwill and on potential investors.     1) MIEC (Manufacturing Industry Expenses Comparison)     As we know, the basic organization of the company s continuingoperations consists of 12 key businesses, which contain management units of