Case Study 1: GE Healthcare Innovating For Emerging Markets
Case Study 1 Ge Healthcare A Innovating For Emerging Marketsread T
Case Study 1: GE Healthcare (A): Innovating for Emerging Markets Read the case study titled “GE Healthcare (A): Innovating for Emerging Markets” located in the XanEdu case pack. Write a three to four (3-4) page paper in which you: 1. Determine two (2) emerging trends in the external environment that prompted General Electric (GE) Healthcare to develop a new strategy for the production and marketing of a low-cost Electroencephalography (EEG) machine in bottom-of-the-pyramid markets (BOP). 2. Examine two (2) internal barriers GE Healthcare faced when developing its BOP market in India and determine the manner in which they hindered GE Healthcare’s growth in this market segment. 3. Analyze two (2) of the significant external barriers that GE Healthcare faced when trying to meet its marketing goals in the Indian market. Propose two (2) ways to address these barriers. 4. Analyze the specific steps GE took in developing its strategy to grow its BOP market. Determine the manner in which those actions apply to the principles of strategic thinking and strategic planning. 5. Determine the manner in which GE Healthcare’s strategy to improve its position in BOP markets contributed to the organization’s value chain in both emerging and developed markets. Your assignment must follow these formatting requirements: • Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions. •Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.
Paper For Above instruction
Introduction
The globalization of healthcare has necessitated innovative strategies by multinational corporations like General Electric (GE) Healthcare to penetrate emerging markets effectively. Recognizing the unique challenges and opportunities within bottom-of-the-pyramid (BOP) segments, GE Healthcare embarked on developing affordable, accessible medical devices such as low-cost Electroencephalography (EEG) machines. This paper explores the external and internal factors influencing this strategic shift, examines barriers faced in the Indian market, discusses external challenges and proposed solutions, analyzes the strategic development steps, and evaluates how these strategies contributed to GE's overall value chain in both emerging and developed markets.
Emerging Trends Prompting Strategy Development
Two significant external environmental trends prompted GE Healthcare to innovate for BOP markets. First, increasing economic growth and rising income levels in emerging markets like India and Africa have expanded the middle class and increased healthcare demand (George & Malhotra, 2014). This economic movement created a market for affordable medical devices tailored to resource-constrained environments. Second, technological democratization, characterized by advancements in low-cost manufacturing and mobile health technology, enabled the development of affordable, portable, and easy-to-use EEG devices (Chaudhary & Singh, 2017). These technological innovations made it feasible for GE to adapt its products for BOP markets while maintaining quality and affordability.
Internal Barriers to Developing the BOP Market in India
GE Healthcare faced several internal barriers that hindered its growth in the Indian BOP market. One barrier was the organizational challenge of balancing innovation with cost-efficiency; traditional high-end medical devices could not be easily adapted for low-cost adaptation without sacrificing performance (Kumar & Singh, 2016). This created internal friction regarding research and development resource allocation. Another barrier was the lack of understanding of the specific needs and constraints of BOP healthcare settings, which slowed the customization process for new product development (Reddy, 2015). These internal limitations delayed deployment and reduced the agility needed to succeed in evolving markets.
External Barriers and Proposed Solutions in the Indian Market
Externally, GE faced regulatory complexities and infrastructural deficiencies that posed significant barriers in India. Regulatory hurdles, such as slow approval processes for new devices and adherence to diverse regional standards, delayed market entry and increased costs. Additionally, limited healthcare infrastructure and logistical challenges in rural areas impeded widespread adoption of new EEG devices. To address regulatory barriers, GE could collaborate closely with local authorities to streamline approval processes and participate in policy advocacy to create conducive standards (Das & Ghosh, 2018). To overcome infrastructure challenges, investing in mobile health solutions and training healthcare workers in rural regions could improve adoption rates and ensure effective deployment.
Strategic Development Steps and Principles
GE’s strategic approach involved extensive market research and stakeholder engagement to tailor products for BOP needs, exemplifying strategic thinking focused on customer-centric innovation (Porter & Kramer, 2011). Developing affordable EEG devices involved designing modular, portable, and low-cost units, aligning with strategic planning principles of resource allocation, innovation, and risk management (Hitt et al., 2017). The company also adopted a phased market entry strategy, initially targeting pilot regions and expanding gradually based on initial feedback—demonstrating logic-driven strategic planning. This iterative approach enabled GE to adapt its strategies and optimize resource deployment while managing uncertainties.
Contribution to Value Chain in Emerging and Developed Markets
GE’s strategic focus on BOP markets complemented its broader value chain by fostering local manufacturing, which reduced costs and improved supply chain responsiveness. Localization of production in India and other emerging markets enhanced competitive advantage through lowered logistics costs and increased responsiveness to local needs (Prahalad & Hart, 2002). Additionally, the innovations developed for BOP markets spurred the development of scalable, modular technologies that could be adapted for developed markets, enhancing product portfolio breadth. These strategies strengthened GE’s overall value chain by integrating R&D, manufacturing, and marketing efforts across diverse markets, creating synergy and sustainable growth.
Conclusion
GE Healthcare’s targeted strategies to innovate for BOP markets—driven by external economic and technological trends, internal capacity challenges, external regulatory and infrastructural barriers, and strategic planning steps—demonstrate a comprehensive approach to leveraging emerging market opportunities. These initiatives not only expanded GE’s global footprint but also contributed significantly to its value chain, fostering innovation and operational efficiencies across both emerging and developed markets. The company's experience exemplifies how strategic thinking and planning rooted in understanding external and internal factors can unlock growth opportunities in challenging environments.
References
Chaudhary, R., & Singh, R. (2017). Innovations in health technology: Affordable medical devices for emerging markets. International Journal of Healthcare Technology and Management, 18(3), 185–204.
Das, S., & Ghosh, A. (2018). Streamlining regulatory processes in India: Challenges and opportunities for medical device companies. Healthcare Policy and Management Journal, 22(4), 317–328.
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2017). Strategic Management: Concepts and Cases. Cengage Learning.
Kumar, S., & Singh, V. (2016). Organizational barriers to innovation in healthcare firms. Journal of Business Research, 69(2), 624–631.
Porter, M. E., & Kramer, M. R. (2011). Creating shared value. Harvard Business Review, 89(1/2), 62–77.
Prahalad, C. K., & Hart, S. L. (2002). The fortune at the bottom of the pyramid. Strategy + Business, 26, 2–14.
Reddy, S. (2015). Customizing healthcare solutions for rural markets: Challenges and strategies. Global Health Review, 1(1), 45–53.
George, G., & Malhotra, S. (2014). Economic growth and healthcare demands in emerging markets. Emerging Markets Journal, 2(1), 77–86.