Operating Performance Analysis Of GE Company Light-asset Profit

Presently, the China's economy is shifting its gear from high-speed growth to medium-high position, facing structural adjustment as well as digesting ex-ante stimulation policies. Accelerating the strategic revamp on economic structure is necessary to satisfy the current economic situation. As an ingredient of the manufacturing sector, appliance industry has been contributing to improve the quality of people's life and stimulate economic growth in the meanwhile. Due to the fact that prior extensive growth model which stresses on one-side pursuit of improving economic efficiency generally gives rise to a series of problems, such as excess capacity, resources waste and environmental pollution alike, traditional asset-intensive model which profits from low price and massive scaling is unable to adapt to sustainable development. Therefore, how to eliminate outmoded production capacity and improve core competitiveness, how to develop a profit model with the purpose of promoting streamlined development, will be the urgent problems that Home Appliance Industry needs to settle.Based on value chain and the operational performance theories, this paper elaborates the domestic appliance manufacturing bellwether GE's developing story,which includes integrating accumulated light assets, R&D, manufacturing,supply-chain operations, marketing, service and cash flow management etc. It also uses the “asset-light profit” model to explain how company GE forms a complete industrial chain and later transfer it into a high-margin industry and becomes a sustainable and profitable enterprise. By comparing with market rival HR, GE's story further confirms the superiority of asset-light model, it also proves that asset-light business model has close relationship in maximizing the value of a company. The result provides guidance for future development as with enterprises to maximize their values.The contribution of this article is that it summarizes valuable experiences from GE's model, which could be already in place for other companies, such as excavating and integrating potential asset-light, planning and managing working capital,recognizing product marketing channels, improving supply-chain ability as well as arranging cash flow capacities, these experiences bring innovative and guidingdirections for enterprises who are in the stage of transformation and thereby it would be useful for exploring their own light-asset profit model.