"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.