GE Update- Not consistent with its past success

Not Home grown and not strategic...
In my book, The Secret To GE's Success, I emphasize that one of the five reasons that GE has been able to continue to prosper, while most of its peers have disappeared, is that GE has been able to "home grow" its own leaders and not hire them from the outside, and the company has had a very disciplined strategic thinking and review process, that had identified " potential problems" and worked to prevent or minimize their impact.


But it appears that this is not as true today in GE, as it was in the past.


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, become the General Manager, have the complete support of Jeff Immelt to move GE into very high risk "sub-prime" markets.

Amy became one of GE's highest- profile young women and even given 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 power point presentations.. "she was a kid who didn't like to go to camp".

It is clear that GE didn't do its traditional disciplined strategic thinking and evaluation process and doesn't have the internal auditing systems that made it successful in the past and its suffering the consequences.

Discipline, comprehensive thinking and challenging was a reason for GE's past success and GE must be sure that these skills and processes are still alive and well, even it inhibits some of its "dreaming sessions".