The Road Ahead
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Slide 7 talking points – “The Road Ahead”
On September 7th, 2001, Jeff Immelt, now a 24-year veteran of GE, was appointed Chairman. Four days later, the world changed forever.
Over the past twenty minutes we have given you a window into the world of GE under Jack Welch, and now I would like to take you through the past 5 years, and into the new GE under Jeff Immelt, GEs 9th Chairman in its 128 year history.
I am sure that everyone has read the recent Fortune article entitled “Tearing up the Jack Welch Playbook,” and I would like to offer our own interpretation of Welch and Immelts executive leadership styles through a comparison of the two leaders and how they traveled two roads, both with a single destination, both requiring different vehicles to get there.
Growth – * Immelt, after seeing his companys earnings follow the unfavorable trends post 09-11, truly entered the CEO position during a time of global economic transition. The entire world (not just the business world) was experiencing a shift in thinking towards personal responsibility. More importantly, the people had finally caught up with the practices, and companies could no longer get ahead by having a lean process, or by understanding how to manufacture more effectively than their competition. Immelt has recognized that in order to succeed in todays environment, you need to understand what your customers need and where those products will be most successful in both new and existing markets.
Strategy – * As such, Immelt has turned to GEs core customers for actual product / R&D ideas during what he has coined “dreaming sessions.” Given the rate at which new products are being developed, Immelt is out to truly find uncontested markets, via the feedback and input from those who use them. These are Blue Oceans (mention book reference) where companies are not competing, spilling one anothers blood to make an existing product better. Rather, the strategy employed here is to really listen to your customers and then take their needs, desires, and input back to your team so that the “dreams” can then turn into a reality that is both refined and revolutionary.
People – * I think this is perhaps the one area in which both Welch and Immelt had the most overlap. We all want the best, brightest, and most leveraged people working at our companies. The core difference is in the risk that Immelt is willing to take in his people, and the information sharing that is necessary to maximize the return on those risks. (mention the four barriers of commitment, passion, trust, and team that cannot be crossed but leave a lot of room in between for development).
Innovation – * As we mentioned earlier, much of the growth experienced at GE under Welch was attributable to his ability to both remove the weaker players, and to innovate the processes. Immelt has a different challenge, with a very different solution. Under Immelt, GE funds “Imagination Breakthroughs” to turn their customer needs (generated from top leaders in the company) into products that must generate $100M or more.
So, what does all of this mean? You are probably asking yourself, “Should I emulate Jack, or Jeff, (or Joe)?”
The core takeaway from all of this is not that Welchs models for leadership, success, and development would not work today (because we feel that Welch would be implementing a very different strategy if he were GEs Chairman in todays economy), but that both Immelt and Welch were able to create and match GEs Horizon 1+2 execution plan with its Horizon 3 strategy. And, more importantly, that their strategies were always dynamic, and responsive to the economic, and competitive environments in which GE was operating.
Slide 7 talking points – “The Road Ahead”
On September 7th, 2001, Jeff Immelt, now a 24-year veteran of GE, was appointed Chairman. Four days later, the world changed forever.
Over the past twenty minutes we have given you a window into the world of GE under Jack Welch, and now I would like to take you through the past 5 years, and into the new GE under Jeff Immelt, GEs 9th Chairman in its 128 year history.
I am sure that everyone has read the recent Fortune article entitled “Tearing up the Jack Welch Playbook,” and I would like to offer our own interpretation of Welch and Immelts executive leadership styles through a comparison of the two leaders and how they traveled two roads, both with a single destination, both requiring different vehicles to get there.
Growth – * Immelt, after seeing his companys earnings follow the unfavorable trends post 09-11, truly entered the CEO position during a time of global economic transition. The entire world (not just the business world) was experiencing a shift in thinking towards personal responsibility. More importantly, the people had finally caught up with the practices, and companies could no longer get ahead by having a lean process, or by understanding how to manufacture more effectively than their competition. Immelt has recognized that in order to succeed in todays environment, you need to understand what your customers need and where those products will be most successful in both new and existing markets.
Strategy – * As such, Immelt has turned to GEs core customers for actual product / R&D ideas during what he has coined “dreaming sessions.” Given the rate at which new products are being developed, Immelt is out to truly find uncontested markets, via the feedback and input from those who use them. These are Blue Oceans (mention book reference) where companies are not competing, spilling one anothers blood to make an existing product better. Rather, the strategy employed here is to really listen to your customers and then take their needs, desires, and input back to your team so that the “dreams” can then turn into a reality that is both refined and revolutionary.
People – * I think this is perhaps the one area in which both Welch and Immelt had the most overlap. We all want the best, brightest, and most leveraged people working at our companies. The core difference is in the risk that Immelt is willing to take in his people, and the information sharing that is necessary to maximize the return on those risks. (mention the four barriers of commitment, passion, trust, and team that cannot