| |
Talent required to implement an aggressive growth innovation strategy.
In my most recent book: THE SECRET TO GE's SUCCESS... I used "LATIN" to summarize why I think GE has been so successful. LATIN stands for Leadership, Adaptability, TALENT, Influencing and Networks.
Over the past few months I have focused on Leadership and Adaptability, to evaluate the Immelt Team's actions and policies, but it is really TALENT that can make the difference. No leader can do it by him or herself. It takes the RIGHT TALENT to make it work.
In my fourth book: Risktaker, Caretaker, Surgeon, Undertaker... the four faces to strategic leadership. I describe the unique talents and team required for the most popular strategies. In the next few blogs I wish to demonstrate how these talents differ from one strategy to another and the challenges they present to the human resource organization.
I will start with the talents required to successfully implement an aggressive growth, innovation strategy. This innovation can be either based on creating a new innovative product, like a new electric car; or a service, like a new way to teach foreign languages; or software and systems that improve communications.
Folklore challengers. Obviously the first talent required in the innovators of the product, service or software. These individuals must be willing to experiment and challenge the current technologies or the folklore. Experimentation is key.
Next Generation before required. The innovative staff must recognize that no matter how clever they think their innovation is, it will be replicated and copied in time. This means that the team must not fall in love with their innovation, but be prepared to respond when the enemy tries to replicate or leap frog the innovation.
GOOD AGGRESSIVE PATENT and Copyright LAWYERS...Even if you have the best patents or copyrights, you must be prepared for challenging the copycats... this means you have a strong legal staff or access to the best legal patent and copyright lawyers who will aggressively challenge any and all violations, even if they are questionable.
MISSIONARY SELLERS - the sales and marketing staff must be COMPLETE zealots and believe in the innovation. They can't even be objective...but must appear to be objective.
PRODUCTION MUST MEET EVEN EXCEED EXPECTATIONS. The production team must meet even exceed expectations and respond quickly to any problems. This is a no quibble mentality.
Enough funds to stay the course...This requires accountants and financial teams that can get the money and then assure that the budgets are met and not exceeded.
This is the first in a series of articles that will describe the RIGHT TEAM and RIGHT TALENT required to execute a variety of strategic options and alternatives.
If you wish to see the total picture...read my book : Risktaker, Caretaker, Surgeon, Undertaker- the four faces of strategic leadership. It can be purchased on www.strategyleader.com
Tuesday, July 1, 2008
"T" stands for TALENT (home grown)
As I was writing THE SECRET TO GE's SUCCESS, I concluded that I could use one word LATIN to summarize why GE has not only survived but prospered over 126 years while its peer companies, like Westinghouse, no longer exist. The T stands for TALENT, but not just the everyday type of talent, but HOME GROWN TALENT.
Since GE's beginning, led by Charles Coffin, who was the first CEO of General Electric, after Edison merged his company with Thomson Houston, GE has been committed to growing its own talent in all functions and at all leadership level. It did this by recruiting bright people from middle class backgrounds and providing a combination of training and tough evaluations. It was always competitive and the survival of the fittest.
Many think that it was Jack Welch was the architect of this type of tough minded "up or out" mentality, but this human resource strategy, started in the late 1890s and was continued by all of the leaders over the 126 years. (I personally experienced the selection and evaluation process and even held positions where I had to make the tough the decisions.)
Immelt has continued this heritage and it was clearly demonstrated this week when the head of the Aircraft engine business left and was immediately replaced. This is very rare in today's environment which I call the Just In Time SUCCESSION planning system. Most companies don't recruit early, train, evaluate and have a DEEP bench...they just wait until someone leaves, then they hire a "headhunter" to recruit someone from another company, which most often is GE.
GE and Immelt are to be applauded that they have continued the "GROW YOUR OWN" tradition and still have the deepest bench in all of American and probably global companies.
Unfortunately, as I pointed out in the conclusion of my book... GE is the first choice of most "head hunters" and they will make very attractive offers to the GE team. This is going to be a problem for GE as time goes on and many of the GE trained and developed executives and professionals are offer deals they can't resist. Further since they know who the best and brightest are they will move in and recruit others from the GE bench.
So, the issue is whether Immelt and his successors will continue to be the training ground for other companies or revert to the more opportunistic " JIT" system. I hope they continue since this is one of the reasons that GE continues to prosper and has differentiated itself from the rest of the "also-rans".
Bill Rothschild, author of THE SECRET TO GE's SUCCESS, now in Chinese, Indonesian, Korean, Japanese, Spanish and many English multi-media versions.
Tuesday, April 8, 2008
MBA needs to be combined with on the job experience- it worked in the past, why not now?
The April 7,2008 Financial Times' article " Masters and Misgivings" celebrated the 100th anniversary of the Harvard Business School and raised several critical issues about the worth and need for MBA degrees. It was amazing to learn that over 500,000 students will receive MBA degrees globally in 2008.
The MBA degree has become almost a must for those who want to become senior managements in many organizations. It is like the bachelors degree became a must for my generation. But the real issue, is it worth the time and effort and would organizations be better off taking undergraduate degree holders and train them.
GE's Talent was homegrown.
In my recent book: " The Secret to GE's Success", I stressed that one of the reasons that GE has been successful for over 127 years, is that it has developed its own talent and created a strong and deep bench. Training programs began with the founding of the company in the 1897 and has continued today. The first programs were technical programs, but the company recognized the need to train financial and business leaders and in the early 1900's added its renowned Business Training Course. The programs were further enhanced in the 1950's when all of business functions, (sales, marketing, human resources, manufacturing) added their own unique three year programs, that combined on the job training and after work educational programs.
It was at this time that the company opened its famous Crotonville executive management center. The Crotonville courses were taught by a team of both academics and GE staff to assure that the concepts were translated into practical applications and built on real problems and situations and not just case studies. The GE programs built a strong, deep bench of skilled and committed professionals and managers. However, there were no degrees given by the Crotonville or GE training programs so they were not a marketable as an MBA or Masters degree. This was intentional to avoid GE being raided by others.
Today's Graduates want a marketable degree.
Over the last few decades, many companies have stopped their own training and relied almost exclusive on hiring MBA graduates. This was result of the unwillingness of MBA graduates to want to do entry level work and spend more time in the classroom. The company's found this less expensive and so they have relied more and more on hiring the graduates, either directly from the Universities or from the consulting and accounting firms who are still the largest employers of MBA grads.
Need Combination of Academics and Real, Hands On Experience.
Unfortunately, this approach has left some gaps in the experience and skills development of the new recruits. Since most MBA grads start working in middle management or in consulting firms positions, they lack the practical hands-on experience that they can only gain by being in the trenches and learning from the bottom up.
I started my career on GE's Business Training Course and then moved to the Employee Relations Program. On these programs I had assignments as a factory foreman, in the "apprentice shop", in the bookkeeping organizations, in short, in the less desirable but important parts of the business. It is the old story, if you haven't lived it you really can't appreciate what it takes to do some of these routine, sometimes boring, manual jobs. No MBA program can provide this first hand experience and it shows when their graduates enter the workforce. Most lack the sensitivity to the workforce and many consider themselves anointed.
One of the criticisms about the current MBA programs is that they are focused on techniques and not the real applications. Case studies are still academic and not real and you really can't solve real problems unless you face them and must solve them under pressure and with time constraints.
Combinations work...
I believe that MBA programs do have value, but maybe they need to be combined with "on the job, entry level training programs. Maybe the solution is to have students serve an apprentice ship and then go to MBA programs, designed by their employers and paid by them. This is not a new concept. In the 1960's I developed and managed two key technical programs for the GE Missile and Space Division. One was an entry level program, called the Space Technology Engineering Program (STEP)and this enabled the participates to get a Masters at the University of Pennsylvania. The other was a more advanced program called the Systems Engineering Program and it allowed participants to get a doctorate at U of Penn. Both were highly successful in combining academics and practical experience.
Business is not a science... it is an art and this requires learning to apply common sense in a more efficient and organized way...I call it Organized Common Sense. This can only be done with a combination of real life and some academic training and no MBA program can do this on its own.
Bill Rothschild, author of "The Secret Tot GE's Success" and "How to Gain and Maintain the Competitive Advantage in business". Both are available on Amazon.
Thursday, March 20, 2008
Sensible Succession Planning
It appears that Warren Buffett has " reluctantly discarded the notion of continuing to manage the portfolio after my death" and has embarked on finding three successor to fill his job. This is consistent with my June 2007 Chief Executive Magazine article entitled: "Decision Time for Immelt and Buffett." In this article, I contrasted the GE succession planning system with Buffet's lack of concern and lets wait until it is necessary approach.
"Trust Me vs. Obsessive" was the title of one of the paragraphs.
- This is what I wrote: " General Electric has gained a reputation as an innovator in management systems and practices. it succession planning system is complex, time-consuming and expensive, In some ways, it has become an obsession. Reginald H. Jones, Jack Welch's predecessor as chairman and CEO, even reorganized the company to select his successor. Immelt spends a month a year performing the process."
- "Buffett is the other extreme. He is 75 and "he is Berkshire Hathaway" he makes it clear that he has a successor in mind. He doesn't plan to leave and asserts "trust me" that everything is under control".
In a recent March 13, 2008 Business Week article, Rick Wartzman quoted one my favorite author's and management scholars...Peter Drucker: "we tend to pick people who remind us of ourselves when we were 20 years younger". First, this is pure delusion. Second, you end up with carbon copies and carbon copies are weak".
In my book: The Secret to GE's Success"; I emphasize that one of the reasons that GE is still alive and vibrant is that it has had only ten CEOs in its 127 year history and each one was different than his predecessor. Jones was a financially trained executive and different than his predecessor the risk taking Fred Borch; the aggressive Welch was very different from statesman Jones. And it is clear that Jeff Immelt is not a carbon copy of Welch.
There are those in GE, that will tell you that the reason that GE has been able to have internal candidates to succeed its leaders, is because of its elaborate manpower system. But it is important to point out that Borch succeed Cordiner and Jones Borch BEFORE the current elaborate system was in place and both were the right leaders for the right time. In fact, the only two CEO's that were selected with this type of system were Welch and Immelt.
I agree the current system may help but is not the only reason and in fact, it may inhibit the company's growth, which I believe happened under Reg Jones' tenure. (page 185 in my book: "The Secret to GE's Success")
I strongly believe that the reason GE has had this ability is because it has had a commitment to developing people from its beginning and it has been able to recruit, develop and motivate people because of training programs at all levels. I joined GE out of college and became a very committed GE employee because I knew that if I did my job, the company would provide opportunities for me to grow and develop. I also knew that I had to earn my strips and it was not just because of I had friends in high places.
Another key to GE's successful CEO and senior management successions is that it has recognized that different leaders and professional skills are required for different business situations and places on the life cycle. In my book: "Risktaker, Caretaker, Surgeon Undertaker- the four faces of strategic leadership", I describe the different types of leaders and teams required and explain how GE and a few other companies have recognized this fact and have been able to select different types of leaders and professionals to fit its market and competitive environments.
In conclusion, I am pleased to see that Warren Buffett now recognizes the need to select a successor but it is also important to emphasize that his successor will have a very difficult time succeeding a legend and will never have the acceptance as he has had. This is what I wrote: " But it is clear that his successor will not be placed on the same pedestal as Buffett, and if expectations are not met, the investors will not be as kind in their response".
I totally agree with Peter Drucker's quote in his 1999 book: "Management Challenges for the 21st Century" : "Succession has always been the ultimate test of any top management and the ultimate test of any institution"... In my book I put it this way: "Avoid Cookie Cutter succession planning".
Sunday, March 16, 2008
Teaching how to make strategic and implementation decisions with limited information.
The February 4, 2008 Business Week included this story "The case against Case Studies" about how Glenn Hubbard, Dean of Columbia business school was not happy with the traditional case study and was experimenting with what he calls "decision brief" which requires making decisions with less information.
In the late 1960's and early 1970's, when I ran the GE Crotonville's Manager Development Course, a four weeks program and all of the strategic planning programs, I recognized that case studies were inadequate to teach strategic thinking and decision making and so I created an "in-basket/ computer competitive simulation case" that forced teams of students to work to together with limited information to create viable strategies and test their decisions via a simulation. In fact, I used this approach with then Columbia Business Dean, Boris (Bob) Yavitz, at the two week strategic planning program at the University's Arden House executive center in the early 1970s.
This approach created competitive business teams..consisting of a General manager and all of the key functional managers (engineering, marketing, finance, human resources and manufacturing) and split the data up among the team. The GM received information typical of the what a GM would get, the engineering manager received his type of information and so on. This forced the team members to share information, integrate and communicate among each other and use the "strategic thinking tools" we were teaching. In addition, the team could purchase additional information for a fee, if they wanted to... some of which was useful and other not so useful. Just like the real world many of the expensive studies are not very useful, while others are very helpful.
During the stimulation, the teams had to make decisions and were given quarterly results, which included some additional information. At the end of program the teams had to present their strategies and results to a simulated board of directors and were evaluated based on the quality of the strategy, their presentation and the simulated financial results.
The program was very successful in all regards. The students learned the art and science of strategic thinking, they learned how to integrate and communicate among each other, as well as to make assumptions, decisions and see if the financial results. If the team didn't manage their cash well, they could go bankrupt. Many teams, led by senior executives, went bankrupt and were not able to make decisions with limited information.
I don't know if this type of simulation and "in-basket" exercise is still being used at Crotonville, but it was highly effective at the time. Maybe, Dean Hubbard might find it useful to study its effectiveness in the Arden House programs and see if would complement his latest new case study approach.
Tuesday, November 27, 2007
Training Leaders...
The September 25th Fortune has an interesting headline..."GE's secret boot camp" that describes how the un-pretentious locomotive business in Erie, Pennsylvania has become a training ground for GE leaders...
Let's put this business and article in perspective.... GE is one of the FEW producers of locomotives in the world...in fact, it was once on the "divestiture" list for the company since General Motor was the dominant leader in this market and had over 75% of the US market, while GE had only 25% and was declining. GM developed the electro-mechanical version and GE was the electric only leader.
But GE was lucky...GM decided to harvest/ divest its non- automotive businesses and so GE was given the opportunity to take control. Fortunately it had strong manufacturing leaders and the business moved from a poor number 2 to the leader.
Over the past decades, GE locomotive continued to make its numbers and its portfolio position moved upward... it became a consistent CASH COW and its management was rewarded.
If GE is using this business to train leaders, it must be training those who can lead mature businesses, where they are the leader in a monopolistic market and have the resources to incrementally innovate and maintain high quality and competitive costs...unfortunately this is a very selective part of the world of business...
I addressed this leadership issue in my fourth book" Risktaker, Caretaker, Surgeon and Undertaker...the four faces of strategic leadership" and stressed the need to recognize that there is no one leadership style or type for all seasons and situations...obviously GE Transportation, which should be called GE LOCOMOTIVE... requires the skilled of a caretaker... and they have been able to provide this type of leader...
If you are interested in learning more about matching LEADERS and TEAMS to strategy, you can purchase my book by visiting my website: http://www.strategyleader.com/
It clearly demonstrates that there is "no leader for all seasons and situations" what it takes to leader a new venture is very different from one whose role it is to just defend and incrementally improve position...if GE needs leaders to lead mature, dominate share businesses..then ERIE is a good proving ground, but if it needs to create new, high risk businesses, which it does if it wants to acheive the Immelt GO BIG strategy...then this is not the right place to train them...this is the dilemna and challenge of Jeff Immelt and the strategy he is articulating..
October 29, 2007-
Not Home grown and not strategic... In my book I emphasize that one of the five reasons that GE has been able to continue to grow, while most of its peers have disappeared is that it has been able to grow its own leaders and has had a very disciplined strategic thinking and evaluation process, especially since Fred Borch and Reg Jones...
But things change and not for better... in fact, some of the recent revelations about GE may indicate that it has adopted a very OPPORTUNISTIC approach to people and strategy.
In the October 29, 2007 Business Week the headline reads: Adventure of a Sub prime Survivor. The story describes Amy Brandt and how she was able to sell her company WMC Mortgage to GE. She was awarded the General Management position, again unique in previous GE history, and get the complete support of Jeff Immelt.Amy became one of GE's highest- profile young women and even give a Jeff Immelt "high-five" after her Boca Raton presentation in January 2005.
"Today, Brandt is gone and GE is struggling to contain its mortgage mess." says the article. Since January 2007, "GE has sold off more than $ 4 billion of loans ($375 million is left" and closed down operations, taking a $1.4 billion charge in the third quarter and a discontinued Japanese loan operation.
But Brandt is living well.. She lives on a 30 acre ranch is starting a new career... she still thinks Immelt is "very charismatic" but recalls she hated the GE presentations.. "she was a kid who didn't like to go to camp".
It is clear that GE didn't do its traditional due diligence and its suffering the consequences.
What they did both in the executive ranks and the lack of a complete and comprehensive strategic evaluation is completely different from what made it SUCCEED in the past and hopefully will be recognized by its management.
I hope that GE takes some time to evaluate "The Secret" to its success and tries to continue its success factors....
Home Grown....In my book: "The Secret to GE's Success" I emphasize that one of the key elements to the company's ability to adapt and change is that it goes it own executives and professionals and hasn't copied the "just in time" recruiting of other companies and organizations.
Immelt is continuing this tradition. On July 30, 2007, he appointed another "home grown" executive as a Vice Chairman...Keith Sherin, 48, was appointed vice chairman . He will continue to be the Chief Financial Office, (like Dennis Dannerman was under Jack Welch.)
This is Keith's resume: Keith S. Sherin has been GE's chief financial officer since 1998. Mr. Sherin first joined GE in 1981 through the GE Financial Management Program in Medium Steam Turbine. After three years he joined the Corporate Audit Staff where he progressed to executive audit manager and later manager of Programs and Planning.Mr. Sherin was promoted to manager of Finance for Commercial Engine Operations at GE Aircraft Engines in early 1992, and the following year he was named director of finance for GE Plastics Europe in Bergen op Zoom, the Netherlands.
In the fall of 1995, Mr. Sherin joined GE Medical Systems as manager of Global Finance and Financial Services, and less than a year later he was promoted to vice president of Finance and Financial Services Operation. Mr. Sherin earned his B.A. from the University of Notre Dame and an M.B.A. from Columbia University.
(It is very typical that a CEO will select people he trusts and knows, especially in the Financial position. Keith has been a major player in the development of GE's strategies and is a key player in all of its investment meetings.)
Other Home GROWN Vice Chairmen include:
- Michael Neal- joined Ge in 1979
- John Rice- joined GE in 1978 as a member of the Financial Management Program
- Lloyd G. Trotter- joined GE in 1970 as a field service engineer.
Jeff now has his OWN team in place and all are home grown...consistent with the GE tradition and a major reason for its past success.
20 Year tenure and game plan?
In a July 22, 2007 New York Times article, Nelson Schwartz, discusses the issue of GE size, lack of GE stock performance and the ability of Immelt to lead GE for 20 years.
In my book, I discussed GE's ability to have select leaders that were able to reign for long periods of time. There were only 10 leaders in the 126 year history and Welch lasted for 20 years. In the article, Welch asserts: "my anticipation when I recommended Jeff for the job is that it would be 20 years and I see nothing that would change it".
But Immelt realistically recognized that: " no one is guaranteed 20 years, not me. Not anyone else".
Immelt has taken many recent steps to adapt to the reality of the markets and his ability to get the GE stock to rise. If he continues to adapt, he may last 20 years, but if he doesn't there is no guarantee and it may cause a major change in GE's remarkable story.
We will continue to monitor and report on this continuing sage.
In my book, The Secret to GE's Success" (page 258), I assert: " having a CEO on the job for 20 years may not be a good idea in all cases. It may make the incumbent so dominant that he or she can rule the company with little effective opposition. For many of the same reasons that we limited the term of the United States presidents, I think term limits need to be established on company leaders".
Board of Directors...July 2007. In my book, I pointed out that GE management wanted to have an impartial Board Of Directors described it this way (page 89) "to assure that the interests of the owners will be protected. General Electric has 19 men, of whom only two are company executives. This philosophy continues, though the gender make up has changed...four women are now on the board and only one active member of management...Jeffrey... is now on the Board... The diversity of backgrounds continues... The real issue is whether these Board members are TRULY IMPARTIAL and will vote their conscience and not just follow the game plan of the company... so, far, there is no evidence to say one way or the other...I believe they will...but it clear they are supportive of Jeff and his game plan...
GE Update- June, 2007
Joe Nocera's column "Talking Business" in the June 9, 2007 New York Times strongly supports Immelt as "the right leader for the right time". He asserts: "the age of the authoritarian CEO is over and that today's chief executive today need to have the the whole range of "softer skills". "They need to be able to do really hard things--change a strategic direction, sell a long-valued division, lay off employees--with such a deft touch that no one revolts. Informality is important. Charisma is important. Empathy is important. Admitting mistakes is important....Joe strongly believes that Immelt has all of these characteristics and appears that he is convinced Immelt will be successful for his 20 year tenure.
I talked to Joe before he wrote his column and he elected not to include my comments. I told him that I like Immelt, but was very concerned about his adaptability. Immelt clearly is convinced he is right and will take the criticism. This is leadership and I wish him well...BUT...all of the GE CEO's had the same conviction and fortunately they were willing to make changes if and when it was necessary. Borch is the best example...he had a similar strategy to Immelts and it failed. Fortunately he was willing to recognize his failures and make major changes. Only time will tell, but we will keep you informed.
Take a look at my article in Chief Executive Magazine to get another perspective and my concerns.
May, 2007
Immelt continues to allocate one month a year to the succession planning process.
He continues to sell the company outside and is desperately trying to get the stock price to increase. He appears to be highly frustrated and provides a very detailed defense of his strategies and why they are going to enable the company to continue to grow BIG. The new theme is " invest and deliver" and he asserts he has been and will continue to be successful and deliver the promised results. Take look at the 2006 annual report.
Thursday, December 6, 2007
Investing in "growing your own talent" makes sense.
Did you ever wonder why GE has a deep bench that is the envy and target of many companies?
Most American companies have adopted what I call "Just In Time" recruiting and manpower planning system. They are unwilling to invest in people and creating a loyal and deep bench and so they are forced to pirate talent from others, if and when they are needed. Their bench is shallow. When a key job opens up they call their favorite "headhunter / executive search" firm, who has a list of key people...at a price. Thus they are forced to take whomever is available and make the selection on "hyped-resumes" and biased recommendations.
The results are predictable and headlined in the media daily. The new crown prince or princess sign highly attractive contracts, for a few years, and commit to stay for a specified period of time. If they succeed, they become "free agents", like organized sports, and resell their talents to the highest bidder. If they fail, they receive handsome rewards for failure.
In my most recent book: "The Secret to GE's Success" I provide an in-depth description and assessment of the GE Way...
Since GE's inception in 1893, its leaders have made it a unchallenged and unchangeable policy to grow their own talent.. at all levels and in all functions of the business. This has included making people development and succession planning a continuing investment of money and executive time. GE has always had a deep bench in all areas, including the CEO level. If one of its executive or professionals leaves or unfortunately is incapacitated or dies, there are several ready, willing and able replacements.
At one time, GE executives and professionals were not willing to leave the company, but in recent years, many have left and moved to other companies. Headhunters track and monitor these key people and when there is an opening they are first on the list.
There is a continuing argument as to whether the GE system and commitment is the most economical and effective or whether they are merely training peoples to be picked off by others. As a GE alumni, I am still convinced that investing in people and GROWING YOUR OWN is the best and most important investment that an organization can make.
Monday, November 26, 2007
Investing in Talent continues to be key element in GE's Success
In my book: "The Secret to GE's Success" I pointed out that one of the key's GE's success is its continuing investment in the development of people.
It started at the beginning when GE developed three key training programs...one for its engineering talent, the other for financial personnel and the third its apprentice system. Swope and Young established the annual "Association Island" programs and Cordiner created the first and still strong management institute at Crotonville to teach the art and science of Professional management.
All of the CEOs since the mid 1950's have used Crotonville to develop key people and to get support their selective initiatives. I spent five great years developing and leading strategic thinking and development courses and the four week Management Development Course and it contributed significantly to my own development and enabled me to be an effective leader and coach.
According to a recent November 25, 2007 Reuter's article, GE and Immelt continue to make major investments in development globally.
They reported that GE spends $1 billion in training its own people and another $1.5 billion on customers...Crotonville was updated under Welch and still serves as the center of "learning"....(It is interesting that GE has a LEARNING officer and not just a development leader... I think this is appropriate since as a teacher and consultant, it is clear that everyone can learn from a professionally developed and implemented program.)
Having the right talent, at the right time and in sufficient numbers often is the difference between winning and losing. Take a look at my extensive descriptions of GE's programs and their strengths and limitations in my book.
GE Update- June, 2007
Women's Networks- Five years ago GE instituted what it calls "Leading and Learning Summit". This brings together about 150 top-level women, two thirds of whom are customers and suppliers, to discuss wide range of ideas and issues". (Business Week June 18, 2007, page 58). It is reported to be highly successful and in demand from both inside and outside women. It includes only female speakers, except for Jeff Immelt, who is a strong advocate of helping women move up the ranks. It was reported that 20% of GE businesses are now led by women.
Keeping Talent. Baseline Magazine (6/14/07) describes why many GE trained CIO's are leaving GE and how this creates a major problem for GE. The reasons are obvious. First, headhunters love GE people, second, the other companies offer very attractive salaries (" the offers GE people get are unbelievable and, in many cases, impossible for people to turn down") and there are only a limited number of growth opportunities within GE("only a few get to proceed to the upper echelons") . GE has always had to deal with this situation, but as many organizations have what I call a "just in time/ pirating" rather than investing in the development of their people, it is likely to get worse. How long can GE afford to make the investment and then lose many of its trained people?
Seems Ironic. Immelt has been clearly committed to the breaking of the glass ceiling and promoting them to executive positions. He serves on a women's organization's board and as reported below has established special programs for women. So it is very strange that Lerene Schaefer, filed a lawsuit, accusing GE of systematically discriminating against women in both pay and promotions and is seeking a class action status. It appears that Ms. Schaefer was recently demoted from her post as general counsel of GE Transportation, because the group's CEO wanted a "big-time G.C.". During my career I have seen many situations where people were removed or demoted and it is hard to believe that it was just because of their religion, gender or race. It will be interesting to see how this situation is resolved.
NBC Universal is clearly not following the GE successful practice of developing and promoting their home grown people. NBC has now demonstrated that it lacks a clear HR plan. It continues to hire from the outside and to look for someone to stop its declining market share . The only time the GE followed this practice is when it was trying to save its weak computer business. This hire/ fire practice failed for the computer business and it was ultimately sold to Honeywell. Will history repeat itself?
Focus is on "team development", new course Leadership Innovation and Growth (LIG) focuses on developing teams. This is designed to increase retention, which Immelt recognizes is a major challenge. " while our people are well paid, some private companies can pay them more".
Another view: Intuit CEO Steve Bennett, a GE alumni, takes exception to several of the Welch/ GE principles of leadership. First he is against "forced ranking". Second he is not as interested as beating the competitors as converting more customers to using Intuit, where he is no CEO. He said: "GE is in sustaining businesses. We are in emerging businesses". He reaffirms my personal belief that you must appoint the right leader for the situation. This is how he said it: " if here was a GE manager that was a finance-driven cost cutter, and they put the person in a job about growth, the results weren't good, we were cited as a success because they took someone who actually had more growth background"...see my book Risktaker
|
|
