STRATEGIC HUMAN RESOURCE

MANAGEMENT
GROUP PROJECT ON

SUBMITTED TO: SUBMITTED BY:

Dr. Umesh Bamel GROUP-2
Faculty, OB/HR Area Aarushi Makhija
International Management Institute New Delhi Akshay Sethi
Rahul Mishra
Saagrika Bali
Tanvi Garg
 INDEX
Sl. Particulars Page
No. No.
1. Acknowledgement 1
2. Introduction 2-4
3. History 5
4. Organisational Structure 6
5. Why is it a compelling story 7-8
6. Current HR Strategies 9-11
7. Analysis 12-14
8. Recommendations 15-16
9. Investment/Financial Aspect 17-18
10. Bibliography 19
 1.ACKNOWLEDGEMENT
Preparing this project has been a rewarding and enriching experience because of the
amount of research required in delivering the report. We would like to thank Professor
Umesh Bamel for giving us this opportunity to learn by making this project report.

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 2.INTRODUCTION

General Electric is an American conglomerate incorporated in New York and

headquartered in Boston. GE was formed in 1892 by merging the Edison General
Electric Company and the Thomson-Houston Company. This was preceded by the
formation and merging of multiple companies from 1876 to 1892.For more than 125
years, GE has invented the future of industry. GE has pioneered technologies that have
spurred world-transforming changes and improved the lives of billions.

Today, the company operates through the following segments: aviation, healthcare,
transportation, power, renewable energy, digital industry, oil and gas and venture capital
and finance.

GE has long been a leader in Renewable Energy, Power, Healthcare & aviation. Today,
GE serves customers in more than 150 countries and has more than 300000
employees around the world. GE participates in a wide variety of markets providing
products & services ranging from railway locomotives, generation, transmission and
distribution of electricity, medical imaging equipment, aircraft jet automation and
aviation. The operations of GE include Technology Infrastructure, NBC Universal, GE
Capital, GE Energy Infrastructure, and consumer & industrial.

MISSION: To invent the next industrial era, build, power, move and cure the world.

VISION: To develop a world that continuously works better, faster, safer, cleaner, and
more cost-efficiently

VALUES –
• Act with Humility

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 • Lead with Transparency
• Deliver with Focus

Culture
The slogan of GE, ‘imagination of work’ clearly expresses what the culture at General
electric is. GE is constantly striving to create new & innovative products/services for our
daily life. Every year, GE comes out with more than a hundred ideas. Their ability to
adapt to the very dynamic and uncertain environment around them has led the
company’s success over years. GE objective of creating and transforming the life of
people settles well with news technologies and ideas. At General Electric, everyone is
willing to learn in order to improve their knowledge, skills and technologies to modify the
current processes and products to better suit the customer needs. The culture at G.E.
adapts to uncertainty. They had courage & imagination to take risk on both ideas and
people.

Major features of the culture at General Electric are: -

• General Electric’s culture is more American than most American based
corporations.
• Rebels are heroes (J. Welch was an effective rebel against majority of General
Electric’s management practices throughout his career before he became the
CEO)
• The Culture encourages going around the hierarchy. This is the hidden purpose
of the workout strategy at General Electric.
• Competition is king, both externally and internally
• Loyalty is determined by individual’s performance and not tenure.
• Communications are confrontational & direct.
• Leadership comes from individuals, not teams or groups.

International Strategy
GE is a leading example of transnational strategy. This combines elements of both
multi-domestic and global strategy of International business i.e. the balance of authority
between business units and the central office (global integration), the degree to which
the products/services are customized in order to accommodate tastes & preferences to
local markets (local responsiveness). General Electric is seeking to achieve both local
responsiveness and global integration. Thus, there are simultaneous requirements for
strong central control and coordination to achieve efficiency and local market
responsiveness. GE develops home innovation to develop competitive positioning
abroad. They are also developing rapidly changing technologies to transform location of
international production and the control of organization. For achieving success in this
industry, GE has been able to exploit technological forces, produce new products, drive
innovation, build relationship, and duplicate the process in different national market.

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Business Portfolio

Major Competitors:
• GE Energy: ABB Ltd., ALSTOM, Siemens Energy
• GE Healthcare Ltd.: Toshiba Corporation, Siemens Healthcare, Philips
Healthcare
• GE Aviation: Rolls-Royce Holdings plc, SAFRAN, Pratt & Whitney Engine
Services Inc.
• Others: Flour corporation (Energy), 3M, Pall corporation (Energy Infrastructure),
American International Group, CITI Group (capital aviation service), American
Express, GM Financial (consumer finance), Deere and company, Altric company
(Commercial Finance), M&T Bank corp. (real estate)

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 3.HISTORY

Major Acquisitions: -

Transaction Business Amount Performance

Alstrom Power/ Renewables 10.1 -
BHI Oil & Gas 7.4 =
Avio Aviation 4.4 +
Lufkin Oil & Gas 3.3 -
LM Wind Renewables 1.7 +
Additive Aviation 1.1 +
Hyclone Healthcare 1.1 +
ServiceMax Digital 0.9 +

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 4. ORGANISATIONAL STRCUTURE

General Electric’s organizational structure is product based. Before Jack Welch, it used
to have a fairly tall structure but through the principles of lean functioning adopted by
him, the structure was reduced to a comparatively flatter structure to the extent possible
of a large multinational company. To avoid barriers to growth, the company
decentralized itself to various product-based divisions and extended authority,
autonomy, accountability and responsibility accordingly. It was decentralized to 12
divisions in the late 20th century because of various diversification activities and
mergers and acquisitions but later the company restored itself to a 9-division structure
as below with supporting functions such as legal, HR and global research.

H. Lawrence Culp
CEO

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 5. WHY IS IT A COMPELLING STORY?
For over the last 100 years General Electric has continued to set the agenda of
management practices and ideas that other companies will follow. It is truly remarkable
to see GE's record of being ahead of the game and this is recognized by practically
everybody involved in the business.

• Under the leadership of Charles Coffin between 1892 and 1912, the principles of
organizational design were set by GE that would go on to guide large
organizations. The key principle amongst these was the idea that the company's
most important product was not transformers or light bulbs but its managerial
talent.
• The first corporate R&D laboratory was started by the company in 1900.
• During the 1930s, the focus was on adopting profit-based bonuses, pension
plans and cooperative labor relations, so that the employees don’t get close to
unions.
• During the 1950s it created the well-known "blue books" that shaped
management around the world with 5 volumes of ultra-detailed guidance for
managers at GE.
• In the 1960s GE shifted the focus as a first mover towards strategic planning.
• In the 1980s and 1990s, GE took up concepts such as Six Sigma, Work Out, and
leadership development and made them part of the management culture across
the globe.

Considering that most organizations would never establish intellectual leadership of any
kind, it has been a unique feat for GE to maintain it for over hundred years.

Another characteristic of GE that is admired by business people is their ability to

unabashedly change direction. Most employees at GE learn from the past but don’t
respect it too much as stated by their former CEO Jeff Immelt. They carry the ability to
not get bogged down by the past and can live in the present which is very crucial. It is
difficult to find another company that can break its own creations so easily. This can be
seen as mentioned below.

• Coffin built an organizational structure on the basis of functions.

• Ralph Cordiner (CEO, 1950-63), broke this structure to pieces. He forayed the
company into computers, after which Fred Borch, the next CEO bailed out.

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 • Reg Jones (CEO, 1972-81) created a layer of executives on the basis of sectors
along with buying a coal-mining company following which Jack Welch, CEO for
the next two decades abolished this layer as well as sold the mines.
• Welch then built up the company’s insurance business and Immelt undid it.
Immelt had been putting his mark on the organization by putting the emphasis on
a long-dormant marketing function and its labs for research and development.

No other organization in the US has managed to be dominant for as long a time as

General Electric and the reasons for the same are evident above.

Fig: How General Electric used the Greiner Model to tackle the various business barricades.

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 6.CURRENT HR PRACTICES
General Electric makes a strong emphasis on the importance of having a high-
performance workforce to drive GE's high-performance business model. Jack Welch,
former Chairman and CEO of General Electric had mentioned that he envisaged
General Electric to become the most competitive enterprise on the planet, He wanted
the organization to embrace creativity, personal excellence and be pioneers in the
industry.

Performance Management System

Vitality Curve

The performance management method at GE consists of a forced ranking system of its

staff to groupings of 20:70:10, namely, "Top 20", "Vital 70" and therefore the "Bottom
10". In this "Vitality Curve" because it was known as by Jack Welch, the “Top 20” are
the high performers of the company and are typically earmarked for more development
and to rise the leadership ladder. The “Vital 70” is the category which includes
competent employees who have consistently managed to perform at a desired level.
The “Bottom 10” is the category which includes low performing employees who were
usually given the pink slip by General Electric.

Training and Development

Generally, GE attracts the brightest of talent for the entry levels positions. GE seldom
hires from outside for its senior level positions. Therefore, GE encompasses a superb

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system in situ for coaching, developing and grooming their individuals to grow with the
organization. These employees can eventually fill the senior ranks of GE and make sure
GE sustains as a high-performing organization.

Leader in residence
This is a program where a professor from a notable University is brought as a resident
leader for about a year. This helps groom internal high performers from GE as future
leaders. Leaders teach in different classes; however, the benefit also lies in what
happens outside the room – sitting on panels or giving fire-side chats telling leadership
stories. They also do 'speed coaching' – short, discreet bits of time they spend coaching
somebody. GE has taken innovation all around the globe in terms of in-house teaching
of leadership classes

"Rise" Program for mid-level managers

This is for mid-level managers having the capability to grow in their careers and convey
all the greatness to coaching and networking. However, it's all done in the local region
so GE is able to localize the particular needs of the area.

Human Resources and Learning Opportunities

GE’s Human Resources Leadership Program (HRLP) is well-equipped to develop and
challenge an individual. It is a combination of GE’s notable leadership development, and
its belief that humans and HR are its competitive advantage. Since 1953, HRLP has
created innumerable generations of HR leaders at GE. Today, the program still focuses
on taking proficient individuals, providing them with globally diverse challenging
experiences, and developing them into top HR leaders.

Analysis on Stringent Performance and Training and Development

GE places grave importance on hiring, training and development so as to make sure

that their employees are the most effective lot within the market. It views high
performance as a significant aspect that offers it a competitive advantage within the
market. GE also encompasses a tight policy of "weeding out' non-performers.

Recruitment

Ability Edge internships

Ability Edge is a Career Edge program that doubles as a national youth internship
strategy. This program offers six-, nine- and twelve month paid internships to graduates
with disabilities in effort for interns to achieve work ex, learning, coaching and
networking. This is as GE believes that the worth of diversity is that it promotes
innovative thinking and a lot of creative ideas.

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Recruiting from Military
GE encompasses a long history of hiring non-commissioned military personnel and has
appeared on GI Jobs Magazine's ‘Top Military Friendly Employers’ for 5 consecutive
years. General Electric has also dedicated a career webpage to the American Military
specialists. Over 35 recruiters participated in career fairs on military bases in 2010.
Also, GE offers an entry-level leadership program, Junior Officer Leadership Program,
designed specifically for military officers along with supporting specialized programs.

Employee references source

GE has a structured system where the existing employees of the organization can refer
their friends and relatives for a position in their organization. The office bearers of trade
unions are typically aware of the suitability of candidates. Management will inquire these
leaders for appropriate jobs. In GE, there are formal agreements to allow priority in
recruitment to such recommended candidates. Unskilled staff is also recruited at the
factory gates whenever a permanent employee is absent. The more efficient ones may
also be recruited to fill permanent vacancies.

Employee empowerment and discipline

GE'S WORK OUT Process

This is centered on quick implementation of measurable enhancements with

accountability that is obtained by simplicity, speed and self-confidence. It helps GE in
optimizing its processes and become lean, efficient and attentive to dynamic market
conditions.

Objectives

• To cultivate grass root solutions.

• To eliminate barriers and bureaucracy
• To create a forum for dialogue and change

Ombudsperson process
GE has an intensive ombudsperson method that is a mechanism for people to raise
queries and report integrity considerations without worrying of any retaliation. With a
global network of roughly 700 ombudspersons, coverage is provided for each business
and country during which GE operates. Employees get to know their native business
ombudsperson through postings, articles and varied company computer network sites,
and by ombudsperson introductions at all-employee conferences at intervals the
companies, together with integrity events and training.
As GE employment and commercial activity has modified, there has been an increase in
the rigor around the ombudsperson appointment method. All ombudspersons speak the
native language and perceive the culture and business environment of their locations.

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 7.Analysis

Strategic Context

General Electric is a Large-sized Corporation which is growth oriented and has a very
diverse Business Portfolio which has been created through Mergers & Acquisitions. It is
considered as an organization which is one of the best examples of corporations which
have formed and implemented a successful Inorganic Growth strategy. Hence, their HR
philosophy, policies, practices, processes and programs need to be aligned with the
Corporate strategy and the individual strategies among the different Businesses that are
spread across countries and in a diverse range of industries as well. Thus, General
Electric is very focused on ensuring that the Leadership aspect among employees is
taken care of through mentoring and coaching. Since the organization works across the
globe, they also have to factor in the impact of a Diverse workforce and a diverse range
of customer segments in a variety of different Business environments.

The company believes that every single employee possesses a significant amount of
leadership qualities and they should be groomed to take up responsibilities in the long
run. Building relationships, collaborating effectively and knowledge-sharing are highly
valued aspects in the organization. The organization also practices efficient Goal-setting
in order to align organizational goals and individual goals and avoid conflict of interest.
The Performance management Systems at the company are directly linked to the goals
and there are elaborate processes for Performance Appraisal for all employees. The
growth-focused approach of the organization is supported through having an industry
wide focus across businesses and geographies, innovation and courage of employees,
clarity of thought across all job levels and Diversity and inclusion. Integrity is also a
highly appreciated value in this organization.

The 5Ps of HR at General Electric

1. HR Philosophy – Their HR Philosophy can be seen around the phrase “We All Rise”.
It effectively highlights the importance of Leadership and Teamwork at General Electric.
All employees are expected to act as leaders as and when required. Helping each other
learn and rise will help the organization and all its members rise together.

2. HR Processes – The company focuses on Goal setting across all businesses. The
Performance Management Processes at General Electric are also very critical and
include the famous “Performance Vitality Curve” introduced by Jack Welch has been a
significant Performance Management practice at GE to categorize employees as “Top

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20”, “Vital 70” and “Bottom 10”. ‘Session C’ is another example of a process that aids in
the career planning of employees at GE

3. HR Policies – Having a High-Performance Culture, building a Learning Organization,

having a good supply of Leaders are three of the most important HR Policies at General
Electric.

4. HR Practices - A detailed overview of the HR Practices related to Performance

Management, Training & Development and Recruitment have already been covered the
Previous Chapter – “Current HR Practices”.

5. HR Programs – Since the HR Programs are a manifestation of the HR Practices,

these programs like Leader in Residence, HRLP, Ability Edge etc. are also covered in
the Previous Chapter – “Current HR Practices”.

HR SWOT Analysis
An HR SWOT Analysis is being done in order to objectively understand the
Organizational Capabilities of General Electric in an ever-evolving Business
Environment. SWOT Analysis is being used because it is a very simple, easy to use and
objective tool to analyze.

Strengths –

• Training Resources – The expertise of the organization in diverse industries

ensures that there can be cross-business learning. Also, the company has the
financial capacity to implement expensive training programs as well.
• Management buy-in for HR initiatives – Since the company has a long-term
vision, learning culture and magnificent leaders in key positions. The top
management recognizes and supports the Strategic development of the
organization through HR initiatives.
• Highly skilled HR department – The organization has highly skilled and
committed HR professionals at the top levels and throughout till the frontline HR
executive. This ensures that everything ranging from Formulation to
Implementation will be done smoothly.
• Low Employee Turnover – The organization has had a healthy Employee
Turnover and this adds to the long-term leadership pipeline of GE.
• Strong Employer Brand – Due to its good reputation and Talent acquisition
strategies, the GE companies are seen as a great place to work. The
compensation and benefits at GE are also highly competitive.
• Sophisticated IT Infrastructure – GE has the cutting-edge technology in the IT
department. They work with the top Software companies to ensure that they are

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 ahead of the competition when it comes to enabling higher efficiency through hi-
tech.
• Employee Safety and Well-being – The organization truly cares about employees
and it reflects in the safety standards and other measures they incorporate for
employees.

Weaknesses –

• Lack of Innovation Culture within the HR department – While the HR department

has been highly effective, the number of innovative, new practices haven’t been
up to the mark. The legacy practices and programs has worked well so far. But
the organization needs to do more for the younger Generations.
• Aging workforce – As per Glassdoor reviews and other data, the average age of
the company is above 30 years. This results in the organization being less
preferred by Gen Z.
• Slow Career Growth – An obvious weakness created by the mammoth size of the
organization is that rising in the organization takes more time than many New
Age Organizations, especially when we compare it to the FAANG companies.

Opportunities –

• Updated Employment Laws – The world is moving towards creating a better work
environment for people of all races, caste, creed, gender etc. Many countries
have been updating the existing employment laws with new dimensions like
Longer Maternity leave, Paternity Leave, laws related to hiring of Transgender
people etc. The organization can build on these aspects to provide better work
environment and enhance its Employer Brand.
• Diversity enablement is getting easier – Because of Globalization and
Technology, more and more people from unprivileged sections, villages and
diverse strata of society are now able to access the resources which were once
available to an elite few. This is an opportunity for GE to capitalize in this social
evolution and attract a diverse range of employees.
• Technology Advancement – Needless to say, the pace of growth of ML, AI and
Analytics can be a great boon for General Electric as it will make things easier for
employees and the organization.

Threats –

• New Age Organizations’ Employer Brand – New Age Organizations like FAANG
companies, Startups and even MSMEs are making a compelling case for
themselves as an employer. The flexibility, autonomy and vibrant culture of these
companies are a threat.
• Increasing Healthcare premiums – Health benefits are an important component
of the Total Rewards Framework of GE. The healthcare companies are
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 constantly increasing the premiums. This adds to the SG&A costs of General
Electric and needs to be handled.
• Talent Deficit – The availability of Talented professionals cannot be relied upon.
Thus, the War for Talent needs to be taken into consideration more seriously.

8.RECOMMENDATIONS

Certain recommendations for Generic Electric for better growth through strategic HR :

• · The company can improve their employer branding in their culture’s aspect
in order to improve their culture and have a more innovative culture and focus on
recruiting people who are enthusiastic about their work and have an innovative
mindset.
• · Implementing the HR practices for the younger generations who have a
more specific and different requirement such as flexible benefits and flexi pay
and work hours. Having a culture which encourages work life balance and give a
sense of a company which takes care of their employees is something that
attracts them. Cafeteria system of benefits can be a useful tool for increasing this
generation’s satisfaction.
• · Re- evaluate the strength, skills and potential of the employees who are
showing signs of low performance and future possibility of attrition. Since there
has been a large no. of cases of mismatch of job and capability of the
employees, they can be given options for job redefining through rotation of job or
job enlargement.
• · Recruitment of talented individuals needs to be done while focusing on
competencies like innovation and proactiveness. There should be focus on
activities which check the capacities of the individual in terms of lateral thinking
and innovative and creative thinking.
• · Majority of the employees are above 30 years of age, hence there is a
severe lack of talent from the freshly graduates. In order to encourage
recruitment applications from the gen Z, the company needs to modify certain HR
practices to attract the age group. This is important as they play a role in
representing the generation Z and provide ideas stemming from their
generational experiences and add value as innovative employees.
• · Health benefits affect the cost of the company in recent years due to the
increasing cost of the healthcare industry, thus there can be certain adjustments
in the healthcare benefit through either caps in the maximum cost for the
investments or shared system of the treatment cost.

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• · Generic Electric being a mature organization with such a large size makes
it inherently difficult for periodic promotions of its employees and more so in
senior level. Hence, the organization can adopt competency based job
description and increase clarity among its employees regarding what is required
for advancing to the next level in their career and what are the points that they
can improve. Special attention should be given to the unsatisfied employees who
don’t feel like the company cares about their career and should be given the
option of job rotation or enlargement and if the pay bands cannot be many, then
wider pay bands should be implemented with sub levels to give them a sense of
progress and hence in retrospect satisfaction on their work.

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 9. FINANCIAL ASPECT
For General Electric today, things don’t seem to be too bright unlike previously.
A lot of GE's troubles in the present era are a result of its foray into financial services.
As noted in 2015, after the Great Recession, GE decided to divest itself of the
company's most financial services divisions. It has slowly sold off that unit’s bulk, but
took huge losses while doing so.
The public image of the company has also declined gradually. In the past decade many
have targeted the in-house legal team of General Electric as the most effective tax firm
in the US, and this holds good reason. With aggressive offshore accounting and smart
structuring, GE pays nothing to little as corporate income tax. In fact, during various
years the government owes GE money.

This has happened during a period when for American businesses, manufacturing has
become an increasingly difficult field. For example, during Q2 of 2018, General Electric
reported a decline of over 30% in its overall profits, with a major chunk of the loss being
attributed to its power division. In addition, the appliances division of General Electric
was sold off in 2016 to a Chinese firm.

Today GE has sold NBC to Comcast, will sell its healthcare division too and has
liquidated most of its financial assets.

All this has made investors even more apprehensive. Considering the soaring debt
levels of GE, investors are talking increasingly about the future of the company.
Questions about the liquidity to debt ratios and bankruptcy are also being raised.
Until the 21st Century, GE’s stocks had been a proven fruitful investment. But this came
to an end with the early 2000s’ bear market. While GE's stock somewhat bounced back
from these losses, it wasn't at the same extent as a lot of its competitors. The company
faced more heavy losses during the Great Recession. Dividends have almost halted
today.

Challenges in the Future

The key reason for General Electric's numerous sell offs can be attributed to the
restructuring of the company and focus on a base of core industrial manufacturing.
Now whether this succeeds remains to be seen, however major investors remain
skittery with firms such as J.P. Morgan rating it a very expensive stock continually. What
remains worrisome is the relationship between the firm's debt and stock buybacks.

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The company's additional decision to reduce the scale of research and development
raises further concerns about its future-forward viability, as does the company's change
of leadership within less than a year of appointing Flannery as the CEO.
General Electric has embarked on a new era. After more than a century of constant
growth propelled by mergers and acquisitions into almost every area of American
business it has begun to shrink rapidly. The organization’s new vision is to intently focus
on a few of its core business areas. Whether that is enough to help it recover from the
decline in recent years, or if this will just push Thomas Edison's company towards
irrelevancy, remains to be seen.

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 10. BIBLIOGRAPHY

• https://www.slideshare.net/mathananto/ge-hrm-project
• https://prezi.com/e-hl2nctsc5p/general-electrichuman-resources/

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