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Aren’t the Japanese conglomerates perpetually underperforming businesses that get away with it because Japanese shareholders are toothless?
Siemens is German and 3M is very much US.
EDIT: here's a list - https://en.wikipedia.org/wiki/Siemens#Former_operations
When researching washing machines recently, I was surprised to see that probably the most innovative mass-market systems available right now are from GE. They’ve brought out a heat-pump based low-energy use combined washer/dryer* that supposedly performs great - something that can’t be said for existing combo or low energy systems. I was surprised to see innovative appliances from GE! I thought they had been reduced…
People who know about appliances say "Never buy a Samsung appliance or an LG refrigerator." Curiously enough, the most-hawked appliances at Home Depot are...
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> Conglomerates of disparate businesses never work in the long term Tell that to Yamaha, Mitsubishi, Siemens, 3M, etc
Aren’t the Japanese conglomerates perpetually underperforming businesses that get away with it because Japanese shareholders are toothless?
Is this a bad or good thing for sustainability?
> For example, Gryta and Mann report that GE would sometimes artificially boost quarterly profits by selling an asset (e.g., a diesel train) to a friendly bank, knowing that it could then buy back the asset at a time of GE’s choosing. So fraud?
I'd be interested in reading the book to get more detail on that. Sale and leasebacks (which often include buyback options) are a fairly common capital management measurement in the asset finance sector.[0] GE could have been committing fraud or this could be sensationalist reporting of a mundane financial management technique. 0: https://en.wikipedia.org/wiki/Leaseback
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It's fraud, but it's legal in the same way insider trading is legal so long as you're a member of congress.
It is fraud when you don't tell that openly and pad books by it, but it is an okay tactic as a hedging risk as long as you are open about it.
What's striking about this article is Gates's refusal, even now, to say anything bad about Welch. Why is that? The vast majority of the bar culture problems are traceable to Welch, as is the shadiness of GE Capital.
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Starbucks is a terrible example. That's like claiming the Costco membership makes the Costco retail business the auxillary. Or that Kroger/CVS/Walgreens membership/rewards cards do the same for those retail businesses (when in fact all they do is drive higher rates of return visits and higher sales). The Starbucks business remains almost entirely their retail service business.
Costco is a terrible example for the point you are trying to make. Costco (rather famously) makes most of it's money from the membership. https://www.fool.com/investing/2019/02/13/how-costco-actuall... In a way, the cheap bulk goods are just a way to convince people to get the membership.
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Aren’t the Japanese conglomerates perpetually underperforming businesses that get away with it because Japanese shareholders are toothless?
> perpetually underperforming businesses Is this a bad or good thing for sustainability?
They'd even, in the longer run, be better for their own shareholders and their descendants.
GE exported a lot of the Welch insanity. Anyone unfortunate enough to be forced into Six Sigma training will attest to the agony. This was through their own and licensed training orgs, their people who left to run other companies, and this guy, a sort-of Erdős-for-business that spread a lot of the frobozztik into other C-level offices. (No idea how much of it he came up with.) https://money.cnn.com/magazines/fortune/…
> For example, Gryta and Mann report that GE would sometimes artificially boost quarterly profits by selling an asset (e.g., a diesel train) to a friendly bank, knowing that it could then buy back the asset at a time of GE’s choosing. So fraud?