@Paloma: And while Immelt hasn't exactly repudiated Welch's insistence that managers remove the bottom 10% of their staff, there's more flexibility, more subjectivity to the process. Risking failure is a badge of honor at GE these days.
This has to be done byCesar.
Immelt wants his managers to lead industries rather than merely follow demand.A key strategy -- and one that amounts to a gut punch to the culture -- involves bringing in more outsiders.
Globalizing research has allowed GE to get closer to overseas customers. The simple fact is that most of GE's growth will come from outside the U.S. Immelt predicts that developing countries will account for 60% of the company's growth in the next 10 years, vs. about 20% for the past decade. But he is also spreading new practices to lethargic economies such as Germany. After a 2002 meeting with German Chancellor Gerhard Schröder reinforced his notion that GE could be doing more in that country, Immelt decided to open the Munich center. As Immelt explains, "there's no place in GE where you feel more like a loser than in Germany. You have Siemens (SI ) and Philips (PHG ), and we haven't been that good." By July, 2004, a new center was up, and the results were immediate. According to NaniBeccalli-Falco, CEO of GE International, the company saw a 21.5% growth in German-speaking markets last year from 2003.VIEWS ABOUT GLOBALIZATIONGrowth: Made the brand stronger in the United statesHe invested into new markets and acquisitions in EU taking advantage of the European crisisGrowth: Revenues from emerging markets like China, India, Turkey, Eastern Europe, Russia and south America Create or expand research centers in New York, China, Germany, India, Brazil
Welch vs. immelt
Jeffrey ImmeltThe growth story of the GE empire under the two emperors ---Presented by GROUP 1 : Seunghyuk Choi Cesar Bravo De Rueda Sandoval Tanay Agarwal Narisa Luanporn Anudeep Paduru Paloma Aguirre munoz
Junior engineer in Pittsfiel, Mass Reason Bureaucracy, 1961: About to quit Felt underappreciated Dinner with Reuben Gutoff Decides to continue at GELater he became Vice President ofGE in 1972 Senior Vice 1981: Became CEOPresident in 1977 ViceChairman in 1979
M.B.A. from Harvard Business School 1982: Joined GE His father managed General Electric Aircraft Engines Vice president of GE home Division applianceVP of GE international marketing and manufacturing President of GE medicals 2001: Became CEO
JACK WELCH JEFFREY IMMELT Imposing leadership More people-oriented Efficiency: paternal-like personality - Strong business and PARADIGM Effectiveness-oriented: down-sizing - Growth engines for the - Top 2 positions or “fix, future sell or close” Risk-taking , sophisticated marketing and innovation Cost cutting, efficiency and Growth: dealmaking -external growth Six Sigma: - marketing -quality and cost -Commercial council- 12METHODOLOGY - Session C- management member board(from appraisal, development, different departments) in planning reviews marketing- ideas discussed -Wanted generalists -Removing the rotation and made specialists -More openness and trust European UnionTARGET MARKET Developing countries USA
JACK WELCH JEFFREY IMMELT “real time planning” Long-term strategy Cash generator: Growth engine: PORTFOLIO - Finance -Infrastructure(focus on - Services green energy) RESPONSIBILITY Within the law Social responsability - Domestic competition - Economic global - Recession and High slowdown interest rates, strong - Recent terrorist attacksEXTERNAL CONDITIONS dollar (September 11, 2001) - High unemployment - Increased to global competition ORGANIZATIONAL He removed the “sectors” He made the 11 business STRUCTURE layer units into 6 in 2005.
Under his tenure, GE’s market cap grew $18 billion to $500 billion Shareholders received 23% per annum return during his tenure. Promote-from-within strategy Work-Out Boundarylessness Best Practices Stretch Last strategic initiative: E-business
"Imagination Breakthrough" proposals per year receive billions in funding. each one has to give GE incremental growth of at least $100 million. Welcoming outsiders into the highest ranks More investment in R & D. Tying executives compensation to their ability to come up with ideas show improved customer service generate cash growth boost sales instead of simply meeting bottom-line targets.
Welch made the brand stronger in the United states. Entry into Europe, Asia in difficult conditions Immelt- : Revenues from emerging markets like China, India, Turkey, East ern Europe, Russia and south America Create or expand research centers in New York, China, Germany, In dia, Brazil
The success of both the CEOs are different- Expansion wise Stock price wise