GE’S TALENT MACHINE: THE

MAKING OF A CEO
Group K
Samarth Singhal (PGP08248)
Sankalp Jain (PGP08249)
1 Sathish Babu D (PGP08250)
SB Subhaprakash(PGP08251)
Shanay D Singh (PGP08252)
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SITUATION ANALYSIS

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 Founded in 1878 by Thomas Edison
 CEO Ralph Cordiner: Decentralization plan
 First corporate university: Crotonville
 Session C: Manager’s career interests and development needs
 Performance evaluation for position levels

 Fred Borsch
 Executive Management Staff: Focused on PLs 13 to 27
 Participation of EMS in Session C

 Reg Jones
 Formal and structured strategic planning
 Addition of new layer: sector 2
SITUATION ANALYSIS(CONT..)

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 Jack Welch
 7 employee bands
 Options as part of compensation
 Rewards only to top performer
 Work Out initiative
 Type 4 manager
 Ranking employees through vitality curve
 Jeff Immelt
 Recall in Applications business, later globalization of GEMS
 Mentored Greg Lucier and Dow Wilson
 Multiple businesses as proving grounds
 Appliances and Lighting – Develop operation’s skills
 Transportation Systems, energy systems and aircraft engines – Manage capital
spending cycle
 Plastics and Medical Systems – Exploit technological growth, acquisitions and
globalization
3
JEFF IMMELT AS CEO

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 Changing situation:
 September 11 attacks: Insurance and aircraft engines companies affected
 Enron scandal
 Crash of NASDAQ

 Strategic priorities:
 Emphasis on technology skills and appointment of two technologists as
Company Officers
 New channels of communication to facilitate emphasis on services
acceleration
 Passion for customers
 Develop internal culture to unify acquisitions and 5 x 5 China vision
 Identification of growth platforms with dependence on human capital 4
PROBLEMS:

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 will GE be able to sustain the success (after Welsch)
 Shareholder want to realise the same returns that they have
been receiving under Welsch regime.
 GE has to be very careful to manage transition from Welsch to
the CEO in order to maintain a balance or he has to minimize
the disturbance during the transition.
 Will the GE strategy continue? will it change and reflect the
leadership trait of the new CEO and if so, to what degree will
the new strategy diverge from the old strategy.

5
OPTIONS

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 Recognition and rewards should be less focused on top 20%
 Regional advantage could help non-American managers in
generating offshore revenues
 Executive bands should not be modified and must be the same
across the organization
 Rewards and recognition in terms half yearly performance of
employee

6
RECOMMENDATIONS:
• Making the rankings more flexible would allow 'B' Players to feel

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valued thus reducing de-motivation and increasing output.
• Immelt should consider expanding the top level or introducing an
additional band of classification so that 'A' Players are
differentiated from 'B' Players.
• GE should also consider a system of reward to all individuals'
achievement of the business; this will make majority of employees
feel more rewarded for their efforts and also increase retention.
• Immelt should focus on more international recruitment targeting
the likes of Europe and Asia. Since 40% of GE's revenues are
generated offshore
• GE's should think consider adapting to provide employees with
psychological reward and also acknowledgment in these areas of
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cultural variation.
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