Infrastructure
Commercial Industrial
Finance
Began in Schenectady,
New York in 1900
Founded with the focus to
improve businesses through
technology
1900
One of the world’s most diverse
industries
Cornerstone of GE’s commitment
to technology
2006
A History of Innovation
1909 Ductile Tungsten
1913 Medical X-Ray
1932 Langmuir Nobel Prize in
Chemistry
1942 First US Jet Engine
1952 LEXANTM Polycarbonate
1955 Man-Made Diamonds
1973 Giaever Nobel Prize in Physics
1983 Magnetic Resonance Imaging
1995 GE90®, The World’s Most
Powerful
Jet Engine
1999 Digital X-Ray
Innovation-Key of GE culture
“At GE, we consider our culture
to be among our innovations.
Over decades our leaders have
built GE’s culture into what it is
today — a place for creating and
bringing big ideas to life. Today,
that culture is the unifying force
for our many business units
around the world”-GE
1950s, decentralization
What is Welch’s reaction to these
Challenges?
Welch’s Vision
“We bring together the best ideas – turning the meetings of our top
managers into intellectual orgies.” ~ Jack Welch
Did it work?
Revenue
Culture?
Jack Welch
1999: Named “Manager of
the Century” by Fortune
named one of the three most
admired business leaders in
the world by Financial Times
September 7, 2001: Retired
as CEO
Published autobiography,
“Jack, Straight from the Gut”
Leadership Styles
Autocratic
Makes decisions alone
• Yields higher performance
Democratic
Solicits input from group for decisions
• Yields positive attitude
Laissez Fair
Absence of managerial decision making
• Yields negative attitudes
Type of Power
Authority
Legitimate Power
• Was CEO: Position to tell others what to do
Reward Power
Control over Rewards:
• Performance reviews, pay increases, bonus
-foxnews.com
Coercive Power
Control over punishment
• Implementation of policies and administration of disciplinary
action
Expert Power
Has expertise or knowledge over the business
• Had been with the company for 20 years when he became CEO
“Followership”
Success depends on how
well followers follow
Not just Jack’s Company
“GE hit a home run with Welch and wanted to try again.
More profoundly, [Immelt] demonstrated a superior
capacity to grow, which was the most important criterion
in the choice…They just knew he would have to rethink
and reinvent GE”
-Geoffrey Colvin (Fortune)
The End of an Era
Reg Jones era (1981)
Built up immense financial strength
Saw profits and growth
New Businesses
-rollingstone.com
Energy
Customized Medicine
GE Now
Operates in 100+ countries worldwide
300,000+ employees worldwide
2006 revenue - $163.4 billion
2006 earnings - $20.8 billion
One of original six companies still
listed on Dow Jones index
Success Continues
Continually finding ways to improve
Accountability of managers
Developing leaders
Rewarding leaders
Leadership Continues
http://money.cnn.com/magazines/fortune/fortune_archive/1989/03/27/7183/index.htm
http://www.ge.com
http://money.cnn.com/magazines/fortune/fortune_archive/2001/01/08/294478/index.htm
http://www.cnnmoney.com
http://www.nni.nikkei.co.jp/FR/TNKS/TNKSHM/welch/index.html
Abetti,P,(2006), Creativity and innovation Managerment, “Case study: Jack Welvh’s Creative revolutionary
Tranformation of General Electric and Thermidorea Reaction (1981-2004), V15 no.1, p74.