The GE Energy Management Initiative Essay Example

billions of dollars. Another challenge is that GE is not good in system implementation.

How GE Canada will be able to sustain the competitive advantage is to partnership with the potential competitors, ESCo, in order to avoid competitive challenges. The GE management system is under direct-connect structure, which was implemented in the late 1980s. With direct-connect structure, the business leaders or functional managers of specific business divisions report to their headquarters in the U. S.. After the direct-connect structure is implemented, it has changed the operation in GE Canada. In the past, the Canadian CEO was fully responsible for the profitability of the Canadian operating division, with the anufacturing plants made a full line of products primarily for the Canadian market with some exporting possibilities.

After the new management system implemented, the U. S. divisional bosses is responsible for the profitability of each operational business division both in the U. S. and Canada. With the change in management system, the business development group has changed its position in GE Canada by switching the role of conducting feasibility studies and new market development for the business unit in Canada to the role of looking for opportunities to leverage the strengths of Canadian activities on a global basis.

The business development group felt that the change in management system has made the U. S. -based business leaders to ignore the potential business opportunity in Canada and added more uncertainty to the business development group role. Most decisions need approval from the U. S. divisional bosses, whom do not have a complete picture of the business potential in Canada and want full control of the business operations in Canada. The change

may hamper any further business development in Canada and reduce the possibility in profitability in the Canadian business operations.

The development in energy management business opportunity in Canada may encounter the objections from Canadian divisional leaders. What Canadian divisional leaders worry about the energy management business is that it is new to the GE Canada and the implementation involves considerable risks in experience in being a prime contractor and being a target for legal actions. The energy management business opportunity may receive the support from the U. S. divisions because the manager of Energy Management business in the U. S. divisions has seen the potential business opportunity in Canada, but the managers of U. S. divisions want to obtain the full autonomy of the energy business operations in Canada.

Hence, the direct-connect management system will hamper the energy management business in Canada. The meeting with the GE Supply executives suggests that the GE Supply executives do not have fully understanding in strong Canadian presence in the business operations in Canada. The executive in the U. S. have convinced that the project contract with Canadian Federal Government will fit in the model of energy management business that is currently running in the U. S. ivisions, but failed in experiences in running the business in Canada.

They have gained a lot of experience over the past 12 months in the U. S. , but that does not mean that the experience in running business in the U. S. will help them run the business in Canada. The lack of corporate management ability in GE Supply executives in multi-business corporations will not add value to the energy management business in Canada because

the GE Supply executives fail to share and transfer the resources and capabilities with Canadian business development team.

The meeting with the GE Supply executives gives the opportunity for me to propose to CEO and VP of finance of GE Canada that the level of energy management business interest in the U. S. businesses and at the corporate level is high because the U. S. divisions have about the same stage of development as that in GE Canada. With the business proposal, it is believed that the Energy Efficiency project will be accepted in GE Canada division and the U. S. divisions will be sharing the resources and experiences with us in terms of the development.

In conclusion, I believe that the Energy Efficiency project is an attractive industry and business opportunity for GE Canada since GE Canada has both the industry attractiveness and competitive advantage. The industry attractiveness of GE Canada is the market size and growth rate, which are both strong in Canada; the competitive advantage depends on the market share and competitive position with regard to quality, technology, manufacturing, distribution, marketing, cost and the most important is the return on sales relative to that of leading competitors.

GE Canada is strong in obtaining the market share and competitive position in the energy management business. Even though there may be obstacles from the commercial customers in terms of the estimated energy savings, the potential future of the project is profitable. The most challenge in the project is from both the direct-connect management system and the potential competitors of other ESCo.

What GE Canada can do is to propose to the U. S. ivisional leaders about the future

profitability potential of the project and the partnerships with the potential competitors to avoid competitive challenges. The partnership with ESCo will potentially eliminate the following risks: install and maintain the energy efficient equipment, measure, monitor, and verify the project’s energy savings, and assume the risk that the project will save the amount of energy guaranteed since GE Canada will provide its name with good reputation, its products, and some servicing expertise.

Since the Canadian ESCo industry is growing and among the most advanced in the world, it is important that GE Canada will be able to see how to partnership with the ESCo in order to avoid competitive challenge. In turn, hopefully the CEO and VP of finance of GE Canada will be able to accept the business and profit potential in Energy Management in Canada.