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A Project Report
Presented to the Faculty of the
School of Management & Entrepreneurship
AURO University
For the coursework
Requirements for the Degree of
Bachelor of Business Administration
PROJECT TOPIC
SUPPLY CHAIN MANAGEMENT AT GENERAL ELECTRIC
Submitted by:
SAGAR AGARWAL
Submitted to:
MISS RICHA AGARWAL
OCTOBER 2014
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ACKNOWLEDGEMENT
First and Foremost, ProfessorRicha Agarwal, Auro University, whose recommendation and encouragementwe'll never be forgotten. Also I would like to thank Mr Amit Patel from GE Appliances in SURAT forsharing the information about company General Electric. Without the help or guidance of my respectableProfessor Richa Agarwal, I would not be able to get knowledge that I have today after doing this report.
After completing this report I have got so much of information and knowledge about a Supply Chain and itsmanagement that i would have never get if I did not. Once again I am very thankful to all the peoplespecially Professor Richa Agarwal with out whom this report would not completed.
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TABLE OF CONTENTS
SR
NO
Topic Page No
1 HISTORY 5
2 INTRODUCTION TO THE COMPANY 6
3 SUPPLIERS AND COMPANY STRATEGY 7
4APPROACHES TO SUPPLY CHAIN MANAGEMENT
- Six Sigma PerformanceSupply Chain Guidelines
8-9
5 OPERATIONS AND LOGISTICS 10
6SUPPLY CHAIN MANAGEMENT AT GENERAL
ELECTRIC11
7 ETHICS IN SUPPLY CHAIN MANAGEMENT 12
8 GREEN SUPPLY CHAIN (The Future)13
9CONCLUSION
14
10 BIBLIOGRAPHY 15
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ABSTRACT
Companies alongside globe supply shackles face momentous trials in order to safeguard that their suppliersmake harmless and quality produce and that they are produced on period and at competitive prices. Insupplement, stakeholders increasingly anticipate firms and their company partners to respect and applynationwide and global labor and environmental standards in their workplaces. This trial becomes even larger
after firms basis suppliers from states lacking adequate power enforcement.
While the policing ideal of the past has made a little affirmative improvements, it has been moderatelyineffective at recognizing the core issues. This has crafted a duplication of efforts, gave to a proliferation ofcodes of conduct that craft confusion, and has mainly been an ineffective use of resources.
In this report we try to identify the supply chain management techniques followed by the company GeneralElectric in their various businesses and how is it responsible to make it the largest company of the world.
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HISTORY
Before 1889,Thomas Edison had company hobbies in countless electricity-related companies: Edison LampCompany, a lamp producer in East New York, New Jersey.
Edison Machine Works, a producer of dynamos and large electric motors in Schenectady, New York.Bergmann & Firm, a producer of electric lighting fixtures, sockets, and supplementary mechanical lighting
devices; andEdison mechanical Light Firm, the patent-holding firm and the commercial arm backed by J.P. Morgan andthe family for Edison's lighting experiments.In 1889, Drexel, Morgan & Co, a firm created by J.P. Morgan and Anthony J. Drexel, financed. Edisonsscrutiny and helped merge those firms below one firm to form Edison General Electric Company which wasincorporated in New York on April 24, 1889. The new firm additionally acquired Sprague mechanicalRailway & Motor Company in the same year. At the same concerned time, Charles Coffin, leadingThomson-Houston mechanical Company, acquired a number of competitors and obtained admission to theirkey patents.
General Electric was industrialized by the 1892 coalition of Edison General Electric Company of
Schenectady, New York and Thomson-Houston mechanical Firm of Lynn, Massachusetts alongside the aidof Drexel, Morgan & Co. Both plants tolerate to operate under the GE banner to this day.The firm was incorporated in New York, alongside the Schenectady plant utilized as head office for
countless years thereafter. Concerning the same time, General Electric's Canadian counterpart, CanadianGeneral Electric, was formed.
In 1911 the nationwide mechanical Lamp Association (NELA) was absorbed into General Electric'scontinuing lighting business followed by emitting the early household refrigerator in 1925. Then in 1928 itopens a broadcasting station and begins the transmission of television programs. In 1942, it started assessingits early jet engine and finally in 1947 the company started a serial creation of automatic cleaning machines.
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INTRODUCTION TO THE COMPANY
The past of General Electric Firm is a momentary portion of the past of knowledge in the United States.General Electric (GE) has evolved from Thomas Edison's residence workshop into one of the biggest firmsin the globe, pursuing the progress of mechanical knowledge from the simplest main requests into the high-tech wizardry of the main 21st century.
The firm has additionally evolved into a conglomerate, alongside a rising shift from knowledge to services,and alongside 11 main working units under infrastructure, electrical appliances, transportation, energy,healthcare, advanced materials, equipment services, Universal film studios, NBC media, Insurance,Consumer financeThe General Electric Company, or GE (NYSE:GE), is an American multinational conglomerate firmincorporated in the State of New York. In 2010, Forbes ranked GE as the world's subsequent biggestcompany. The firm has 304,000employees concerning the world.
The staggering size of General Electric that ranked fifth in the Fortune 500 in 2003 becomes evident acrossthe disclosure that every single of the company's 11 working constituents, if tabulated separately, should
prosper as a Fortune 500 company. GE operates in extra than 100 states worldwide and generates
concerning 45 percent of its revenues beyond the United States. Over the sequence of its 110-plus years ofchange, General Electric has amassed more than 67,500 patents, and the firm's scientists have been awardedtwo Nobel Prizes and countless supplementary honors.
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SUPPLIERS AT GENERAL ELECTRIC
Suppliers are critical partners in GEs worth chain. As GEs companies have globalized, so has our supply
shackle, encompassing in locations whereas nature, condition, protection, labor, human entitlements andsupplementary habits can be problematic. We anticipate our suppliers to pursue the regulations that needthem to delight operatives fairly, furnish a harmless and healthy work nature, and protect environmentalquality. GEs Supplier Expectations law all facets of the Companys connections alongside suppliers, and
contain specific prohibitions opposing compelled, prison, or indentured labor, and prohibitions opposingsubjecting operatives to each form of compulsion, coercion or human trafficking.
GE is not alone in working with suppliers that face significant environmental, health, social, human rightsand security issues. We long ago realized that these challenges, especially in some of the fastest-growingeconomies, were bigger than what one organizationeven one as big as GEcould address alone. In
particular, one of the biggest needs in these regions is the development of local expertise to manageenvironment, health and safety (EHS) issues and labor rights.
STRATEGY
Now the company is already the leader in many areas of business. It is a global conglomerate encompassing
many areas. The main strategy of the Company is not so much growth as the preservation and consolidation
of existing positions.
Growth Strategy:
1. Increase in market share (growth).2. Creating innovative products (new markets).3. The preservation and strengthening of the position
At this stage of growth for the Company is only possible by increasing marketshare, and by offering its new (innovative) products to existing customers.
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APPROACHES TO SUPPLY CHAIN MANAGEMENT
SIX SIGMA IN GENERAL ELECTRIC
Jack Welch, the preceding CEO of GE, selected to apply Six Sigma in GE in mid 1990s. And this deedobtained a outstanding accomplishment in profiting the company. There are four aims of Six Sigmasrequesting in GE: cutting price, fulfilling clients, obtaining credit of Wall Road and enhancing companysynergies. Steering by these aims and associating its own situation, GE joined Six Sigma standardsalongside its service-oriented company (GE Capital Services and GE Health Systems) and industrialized itsown company process. To apply Six Sigma, GE industrialized a Six Sigma cluster to make distinct strategiesand develop the training model. Later the metamorphosis of Six Sigma in GE, it produced a lot of benefits.The most manage benefits are the reduction of price and rise in benefit. The pursuing picture displays the
price and the profit from 1996 to 1999.
From GEs case, we can discern that requesting Six Sigma in a firm will hold countless advantages. First, itis able to enhancing the companys association by elucidating the association process. Second, it is able to
save the price of companys procedure by cutt ing the wreck rate. Third, it is able to rising the worth of
clients because it achieves a virtuous circle from understanding and encounter customers needs tomaximizing profit. Fourth, it is able to enhance ability levels because Six Sigma can be utilized to enhanceability process. A Six Sigma association team of GE Lighting sector prosperously enhanced the connectionalongside its biggest client, Wal-Mart, making a 98% reduction of the wrong notes and disputation so that
both can not merely accelerate the speed of payment but additionally harmonize the obliging relationship.Fifth, it is able to form a affirmative firm sophistication because every single operative knows what he orshe ought to do and how to do it.
Although Six Sigma can hold so countless benefits to a firm, there yet is a little defect. Finally, Six Sigma isjust a method of enhancing management. For disparate firms, there is no universal ideal that they can use.How to develop their models is a criticizer setback in requesting Six Sigma. From the GE example we can
discern that it seized GE quite a lot of period and money to develop its customized model. Even though thebenefits were momentous, the price of Six Sigma training is nearly 1 billion dollars in the five years. Tofirms whose scale is not that colossal, maybe they cannot afford such huge expenditure. But develop animperfect resolution is unusable and costly. So how to balance these setbacks is quite vital to tiny andmedium-sized companies.
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SUPPLY CHAIN MANAGEMENT SYSTEMS GUIDELINES
GE set out the strategies and acts and obligations delineated below for GE companies and company purposesto present due diligence on GEs supply shackle. The Guidelines are coordinated to conform to the Five-Step Framework for Risk-Based Due Diligence in the Crystal Supply Chain Management set out in Annex Iof the OECD Guidance, alongside particular reference to the Specific Recommendations for Downstream.The description of the design of GEs due diligence measures encompassed in this s Report is gave pursuantto the organizational construction of the Five-Step Framework as elaborated in the Supplements.
Step 1: Establish Strong Company Management Systems
Structure internal management systems to support supply chain due diligence
Establish a system of controls and transparency over the mineral supply chain
Strengthen company engagement with suppliers
Establish a company level grievance mechanism
Step 2: Identify and Assess Risks in the Supply Chain
Use best efforts to identify the smelters and refiners in the supply chain Identify the scope of the risk assessment of the mineral supply chain
Assess whether the smelters and refiners have carried out all elements of due diligence forresponsible supply chains of minerals from conflict-affected and high-risk areas
Where necessary, carry out, including through participation in industry-driven programs, joint spotchecks at the mineral smelter or refiners own facilities
Step 3: Design and Implement a strategy to respond to identified risks
Report findings to designated senior management
Devise and adopt a risk management plan
Step 4: Carry Out Independent Third-Party Audit of Smelters and Refiners Due Diligence
Practices
Step 5: Report Annually on Supply Chain Due Diligence
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OPERATIONS MANAGEMENT
Our consolidated Financial statements combine the industrial manufacturing, services and media businessesof GeneralER Electric Company (GE) with the financial services businesses of General Electric CapitalServices, Inc. (GECS or Financial services)
We discuss our Operations in Five parts
Overview of Our Earnings
Global Risk Management
Segment Operations
Geographic Operations
Environmental Matters
LOGISTICS MANAGEMENT AT GE
Logistics Execution CenterThe GE Logistics Execution Center provides assistance with logistics and freight management for GE
Infrastructure businesses. Access to Integrated Logistics Solutions (ILS), which is the principle tool used bythe Logistics Execution Center and can be accessed below. GE personnel can use this site to obtain shipmentstatus and reports, and GE customers can obtain shipment status by project, turbine and purchase order.
Integrated Logistics SolutionILS is the GE Logistics and Transportation Management web-based solution that provides the tools tosupport the planning, execution, measurement and evaluation for the Global Logistics and Transportationrequirements of all its Strategic Business Units.
In partnership with our customers, GE has developed a reputation for excellent performance in its IntegratedLogistics Management (ILM) solutions. We support more than 1,800 aircraft under Performance BasedLogistics (PBL) programs, Integrated Operational Support (IOS) or ILM contracts. Core to our ILM deliveryis our team of logistics engineering specialists. These programs are tailored to meet the specificrequirements of the customer individually, whether civil or military, and involve a close workingrelationship between GE and the customer.
The GE Appliances & Lighting Logistics Management Leadership (LMLP) program has been designed toaccelerate the development of technical talent and build the skills that Program Members need tosuccessfully integrate Supply Chain with other key processes in GE. It is for people who have a proven trackrecord of excellent academic performance, who want a career in logistics and are interested in themanufacturing environment.
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SUPPLY CHAIN MANAGEMENT AT GENERAL ELECTRIC (LIGHTING)
When the Eastern European marketplaces were opened, GE was one of the early Western firms to move in,buying 75% of the Hungarian lighting firm Tungsram. Later two years of ownership, Tungsram haddecreased its operative rolls by 50% and was curving a profit. GE nowadays uses the Hungarian plant tosupply light bulbs to the European market. GE outsourced its European transportation necessities butretained manipulation of warehousing. It centralized warehousing in a solitary ability in Metz, France, thathas manage admission to multi-modal links. Its transportation provider, Danzas, is accountable for arrangingthe burden, bestowing transport papers, loading the trucks, and transport receipts. As GE additionally useslocal transport contractors (e.g., Tanzal in Switzerland), these others have to work alongside Danzas.Interestingly, GE has no computer links alongside Danzas. Instead, Danzas operatives have workplaces inthe GE ability to accelerate data flow. As one more method of facilitating contact, GE capital owns
portion of Danzas. This permits GE to have manage input into Danzas operations.
The intricacy subject alongside that GE had to deal distressed flexible transport scheduling. After GE hadcrafted its solitary warehouse out of abilities in Germany, Austria, France, Switzerland and the Beneluxspan, it comprehended that every single affiliate had set up distinct transport strategies alongside innatecustomers. This endowed a key agility feature, namely individualized goods and services. Though,
encounter customized demands from one ability considerably complex GEs operations. GE ran inefficientlyor was not able to reliably encounter transport times. GE consequently selected to drop its JIT transport wayin favor of projected delivery. Clients can yet change orders up to two dates beforehand delivery. Though,the projected transport permits GE to accomplish a larger utilization rate of its supplies and lower itstransportation costs. It can additionally boat larger volumes alongside less workers.
In core, as a first step, GE decreased intricacy by joining warehouses and outsourcing logistics. This,though, left GE yet vulnerable because of the forecast uncertainty. As a subsequent pace, uncertainty wascut across rising lead periods and familiarizing a frozen period skyline of two weeks for orders. In revisit,GEs clients profited from extra reliable order delivery. The tradeoff: a short lead period alongside maybe80-85% transport reliability for a longer lead period and 99% reliability. Such a method of balancing useful
goals is additionally counseled by Houlihan (1987). In conclusion, GE considerably cut its externalvulnerability as rising the reliability of its transport period, therefore cutting the external exposure of itscustomers.
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ETHICS IN SUPPLY CHAIN MANAGEMENT AT GENERAL ELECTRIC
On-site supplier assessments cover environmental, health, safety, labor, human rights and protection issues.For these assessments, we use a globe questionnaire. The assessments seize locale prior to allocating earlyorders alongside new suppliers, and periodically thereafter on a one- to three-year period construction,reliant on our experience alongside the supplier.Closure necessities for findings are related whichever to compliance alongside innate regulations or, for alittle subject, to higher GE expectations. Typically, findings have to be closed inside 60 days. Buy orders areneeded to be suspended if findings stay open after this period construction unless GE agrees that a closureneeds extra period and/or interim progress has been demonstrated. Findings open for extra than 180 datesare studied alongside the GE company team.
The on-site assessments are led chiefly by sourcing workers or inner auditors specifically trained to findsubjects in our Companys industries. Extra than 600 GE team associates have been trained in methodica laudit skills. To a manipulated extent, third-party firms specifically trained to GE standards additionallyconduct inspections. A team of EHS, labor and supplementary specialists who can furnish guidanceestablished on GEs own comprehensive working history accompanies the auditors.
We supplement their efforts through crosschecks under all local databases such as the Institute of Area andEnvironmental Affairs (IPE) China contamination charts, plus periodic spot-checks and nameless desk-sidereviews of GE audit records by inspectors from supplementary company constituents or from our companyEHS team.
Suppliers who are selected for the on-site assessment plan are additionally assessed employing a keypresentation indicators (KPI) instrument to gauge whether they are growing a robust, long-term associationarrangement in spans like EHS and resource efficiency. The KPI instrument is clarifying to be an competentcoaching instrument to aid suppliers move from reactive short-lived fixes to long-term ownership andimprovement.
Globe sourcing heads and team associates from every single GE company oversee killing of inspections,implementation of findings and describing of metrics. Supplementary plan members from our EHS, Legal,Protection and Human Resources teams furnish audit training, clarification of innate manipulatingnecessities, data on the local expertise needed of assessors, and assistance alongside growing and studyingcorrective deed plans. GE workers globally who interact alongside supplier abilities are anticipated to seizeGEs awareness training obscuring GEs supplier expectations, human entitlements subjects, and on-sitedue-diligence requirements. Each sourcing workers who sojourn supplier locations are needed to seize ahazard-recognition class and to report each potentially problematic attention to our team of assessment
professionals.
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GREEN SUPPLY CHAIN (The Future at GE)
As the people become more and more concerned about the sustainability of our planet, customers are askinginnumerous inquiries concerning the products/goods they are purchasing. Although of the publics focus onthe nature, benefits of cutting a companys carbon impression is the least of the concerns of most companies.
Most of them are unaware of the linkage amid environmental presentation and commercial gain. Slight dothey understand, their firms can find price savings by cutting the environmental encounter of their business
supply shackle, from buying, arranging, and grasping the use of materials to shipping and allocating finalproducts. A little firms have by now ridden the green supply shackle wave to make their contribution incutting carbon footprint.
In 2008, Burton, worlds managing snowboard firm, automated its B2B e-commerce deals alongsidecustomers. By acting so, the firm not merely decreased its paper custom considerably, but additionally cutits price for postage, paper and envelopes.[1] Firms such as Finished mechanical (GE), Toyota Motors,American Airlines cargo, Maersk Line have commenced employing environmental accounting - a procedurethat evaluates the effectiveness of environmental hobbies from the outlook of cost. In particular, Finishedmechanical has a plan shouted "Ecomagination" whereas they are concentrated on producing their revenuestream from environmentally approachable produce to the tune of 20 billion dollars by 2010. [2] General
Motors has additionally decreased disposal prices by 12 million dollars by instituting a reusable containerplan alongside suppliers. Supplementary elevated profile firms such as Wal-Mart and Apple haveadditionally made endeavors to cut the environmental damage provoked by not merely their firms, butadditionally their suppliers in US and overseas.
Another present endeavor should be from IKEA, who proclaimed in the commencing of this year to usecardboard pallets to substitute for wooden pallets for shipment of their products. A main environmentalsubject alongside wooden pallets is that they are vulnerable to insects attacks. A wooden pallet needs to be
fumigated beforehand it is shipped across nationwide borders, and the chemicals cause ecological problemsafter the wood is reprocessed into paper. Cardboard pallets do not have the alike problem. The firm hasindustrialized a new method to crease cardboard in the manner that should furnish the alike strength as
wooden pallet. Cardboard pallets weights merely 10 % heaviness of the wooden pallet, that will save thefirm $193 million a year in transportation expenses. The cardboard pallet will be discarded afterwardsolitary use and reprocessed in the alike manner as cloaking paper, protective cardboard corners and such
packing physical utilized alongside IKEA products.
The accepted belief has managed us thinking that being environmentally approachable will rise expenditure.Though, there are lots of firms out there that have proved to us it is probable to enhance both commercialand environmental performance. So, to all the supply shackle administrators out there, do not waver tocontemplate green, because you are out of excuses.
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CONCLUSION
Todays managing firms and multi-stakeholder initiatives are changing tack and commencing to focus theirefforts on five areas:
Improving association systems
Developing competent complaint mechanisms and workplace remediation platforms
Evaluating inner buying habits to ascertain how their own deeds could negatively encounter theworkplace
Increasing supply shackle transparency
Creating incentives for their clients and suppliers established on communal and environmentalpresentation criteria
This shift in way needs collaboration from a colossal set of stakeholders because no one sector canefficiently accomplish this alone.
There are no silver bullets. Companies should learn from the hard lessons of the past, avoid the pitfalls that
others have experienced and consider targeting resources on building internal capacity to work inpartnership with NGOs, trade unions, multilaterals, peer companies and industry and trade associations totackle these complex issues together. Moreover, companies and their stakeholders should collectivelyengage governments and encourage them to enforce their laws in order to make decent work a reality and tocreate a level playing field for multinational companies and for those suppliers competing for their business.
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HARVARD REFERENCING
Logistics and Management Services | Services | Military | GE Aviation. 2014. Logistics and
Management Services | Services | Military | GE Aviation. [ONLINE] Available at:
http://www.geaviation.com/military/services/logistics-management-services/. [Accessed 14
October 2014].
Ethical Supply Chain - GE Sustainability. 2014. Ethical Supply Chain - GE Sustainability.
[ONLINE] Available at: http://www.gesustainability.com/building-things-that-matter/supply-
chain/ethical-supply-chain/.[Accessed 14 October 2014].
http://www.geaviation.com/military/services/logistics-management-services/http://www.geaviation.com/military/services/logistics-management-services/http://www.gesustainability.com/building-things-that-matter/supply-chain/ethical-supply-chain/http://www.gesustainability.com/building-things-that-matter/supply-chain/ethical-supply-chain/http://www.gesustainability.com/building-things-that-matter/supply-chain/ethical-supply-chain/http://www.gesustainability.com/building-things-that-matter/supply-chain/ethical-supply-chain/http://www.gesustainability.com/building-things-that-matter/supply-chain/ethical-supply-chain/http://www.geaviation.com/military/services/logistics-management-services/8/10/2019 GENERAL ELECTRIC_ SAGAR
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