Management Leadership Development – Welch institutionalized it – it is now an ongoing process in GE.
It is how we managed to go on without him at the helm. There was a leadership team that managed the affairs of the company and clear common goals.
Why did he do it? He saw that the company needs to be different in the new century; the challenges it would face were globalization. We needed to forge new partnerships with corporations and countries.
Jeffery R. Immelt, Chairman and CEO of General Electric, was picked by Jack Welch and the leadership team to reconstruct the company.
Welch was a non-celebrity CEO – this was one of his strong points and also that he helped make a leadership team at GE in his 20 year tenure as CEO.
GE has 300,000 employees and 20,000 leaders
Titles are not what carry the day at GE but ideas and an ability to influence people.
John Rice’s visit to Africa:
- To learn: not to impose creed and decree
- To support the Africa Team
- To experience Africa : it matters more to be in touch with what people go through on the ground to best represent their interests and issues at the top.
What contributes great leadership?
(a) Core Ethical Behaviour – they must have trust embedded in their DNA.
(b) Smart – a great leader must be smart enough to know his subject but must not be the smartest – this give him license to ask stupid questions.
(c) Passionate – people love hanging around passionate people – it’s infectious.
Great learners – great leaders are continually learning – it’s a life-long commitment. GE is a learning laboratory.
(d) Energize others – Infect others with energy. The further you go the further you will rise in responsibilities to lead a team effort. It’s about technical efforts but about enrolment in a problem to be solved, a customer to be contacted… A leader has to be clever and focused enough to energize people to get 110% effort output from them.
A leader is a steward over resources; people, cash, assets, intellectual capital [ideas] created synergies and influencing skills.
Q&A Session:
How did GE handle the recession?
We at GE learnt that business have cycles, Economies have cycles. As such we took out cost. We re-strategized and cut on dividends as well as focused on how we would want to look after the recession.
GE has a keen focus on management training, what advice would you offer businesses and governments in Africa?
It takes time, money and resources. At GE we have 3 leadership courses that I and Jeffery R. Immelt attend at any given time. We encourage entire teams to attend since when they get back to their stations they are most likely to work as a team to achieve goals as opposed to one person who would attend, this spurs competition instead of team work.
What is the leadership challenge that GE faces today?
We are present in 160 countries each of which has a set of challenges. Most countries are against shipping in of products and exportation of profits. Local investment is what will carry the day and as such at GE our ongoing question is the right kind of global footprint to have where. This calls for judicious capital allocation which is a tough question as it is.
What do you do to institutionalize innovation at GE?
We have 2,730 patents registered in the US and what we have ongoing discovered what carries the day is local innovations to handle local problems. We have recently rolled out a hand held Ultra Sound Scan device that can reach the farthest rural home to offer ante-natal care to a pregnant woman who would have not gotten it prior to the innovation. In the recession we did not cut our R&D budget, if anything we increased it and we will grow it consistently. As a company we allow for failure – we learn from it.
In a city that has 300,000 thousand inhabitants, not every resident gets to see the Mayor. How do you manage to maintain the personal touch at GE?
We have broad based communication that we make as personal as possible. We also have web-chat on our website. We also have iPod downloads whereby I am casually interviewed randomly on a random question then this is sent out to all employees as a podcast. This has elicited a personal feel for every employee in the company.
When I am on the ground I have Town Hall meetings as well as round Table meetings all this amounts to a lot of personal touch. I landed at 4:00am and at 7:00am I was having a meeting with the Kenyan Team to give them a listening ear on what they would like to be addressed.
What is your view of your Africa especially so since it contributes 3.5BN $ in sales; a 2% of global sales for GE?
We have seen that there is a lot of potential in Africa going by the numbers we have seen in the last 5years where there was 500M $ in sales in 2004 compared to 3.5BN $ in 2009. This clearly shows that Africa is full of potential. We may not be able to open service shops everywhere but through the GE Foundation we have helped in the opening hospitals with state of the art technology.
The relation between CSR and Capital is that sustainability occurs where there is a reasonable expectation of profit; capital will definitely grow. Tough problems are calling for tough solutions and people need to invest in the solving of these. This is what makes innovation to grow.
The challenge in Africa is that there are 54 countries all with different governments some of which are unstable. The challenge is not the change of guard in these governments as the stability of rules. In the US we have a new president who is not doing things the way his predecessor was doing. We have major health reforms. In Japan, there was a change in the law on financing that cost us 700M $. It is this challenges that often form the risk of our business. It is very interesting to note that investing in Venezuela right now is risky. No investment has no risk to it. The change in risk needs to be looked at vis-à-vis the Return on Investment. There is also the question of corruption which is not only in Africa but in Europe too.
Integrity is a key value at GE.
