Published by:
Harvard Business Publishing
Length: 9 pages
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Abstract
In 1981, both Matsushita and Necchi began to offer high-quality compressors--the heart of the refrigerator--that were cheaper than those GE made for itself. Instead of sourcing to stay competitive, GE''s appliance group renewed its compressor capability and stayed competitive in refrigerators. It made large, long-term investments in a new technology and in extensive computer training for employees. The result is that, in its Columbia, Tennessee plant, GE makes compressors that are 20% cheaper than any made by its dollar-an-hour competitors.
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Abstract
In 1981, both Matsushita and Necchi began to offer high-quality compressors--the heart of the refrigerator--that were cheaper than those GE made for itself. Instead of sourcing to stay competitive, GE''s appliance group renewed its compressor capability and stayed competitive in refrigerators. It made large, long-term investments in a new technology and in extensive computer training for employees. The result is that, in its Columbia, Tennessee plant, GE makes compressors that are 20% cheaper than any made by its dollar-an-hour competitors.