General Electric CEO Case Study
GE was founded in 1892 from the merger of Thomas Edition’s Electric Light Company with the Thomas Houston Company. Its business was based upon exploiting Edition’s patents relating to electricity generation and distribution, light bulbs, and electric motors. During the twentieth century it became not only the biggest and most diversified industrial corporation in America, but “a model of management and strong leadership. With two decades under Jack Wheel’s leadership, the company had only enhanced Gee’s reputation for effective management and leadership.
In 2001 , Fortune magazine named GE as America’s “most admired company” for the fifth ear In succession, and the Financial Times Identified GE as the “worlds most respected company for the fourth consecutive year.
Further, when Jeff Melt took over as Chairman and CEO of General Electric on September 1, 2001, he had no doubts that his predecessor, Jack Welch, a “living legend,” “best leader of the past half-century,” would be a tough act to follow (Rowe & Gouger, 2010).
Research shows that investors had little hope that Melt could ever match the Incredible 50- fold Increase In Gee’s market value that Welch had achieved; the management immunity was more concern with the changes to the corporate strategy, organization structure and leadership camp; management systems that Melt would incorporate into the company. Welch had been a revolutionary and an innovator. In demonstrating profound leadership abilities, Welch, had swept away most of Gee’s carefully constructed structure and its greatly admired corporate planning system.
He had relentlessly challenged GE managers for improved operational and financial performance; he had created a GE management style based upon his own personality, values, and beliefs. HIS management Innovations at GE had exerted a huge impact upon management thinking and management practices throughout the whole corporate sector.
Welch, demonstrated profound qualities utilizing the Path-goal theory which have special focus on assisting subordinates to get around, over, under, or through obstacles that are keeping them from achieving their tasks.
Obstacles may be responsible for subordinates having feelings of Translators, uncertainty, Ana Delving attenuate. Path-goal tenure Implies Tanat leaders should assist subordinates in getting around these obstacles or in removing the obstacles from the path to task completion (Morehouse, 2010, p. 131). In analyzing this case in comparison of the two Coo’s , it can be stated best that this is a decision making directive case, In which Welch, the managers did not always agree on how Welch conducted business, but his directive leadership style emphasized giving direction to subordinates regarding their tasks.
These directions as demonstrated in the above analyses showed that results were expected, and generated how tasks will be accomplished, and the schedule for task completion. In addition, the leader larcenies performance expectations and explicitly outlines the required standard operating procedures, rules, and regulations. In similar terms, following Wheel’s success, Melt knew his number one priority was to restore the confidence of the investment community in GE and pay particular importance to the financial structure and financial reporting matters.
In looking further ahead, Melt realized that his primary leadership direction challenge will be coming to terms with Wheel’s legacy at GE. More importantly, both Jack Wheel’s form of leadership and Jeffrey Melt forms f leadership demonstrated excellent success in GE, with the company having abilities to grow from different forms of leadership across the board, from its history to the present. Corporate Strategy Planning “General Electric operates businesses in more than 20 primary areas from aircraft engines to vendor financial services” (Swing, Meanly, Cooper, & Hartley, 2011, p.
7). Corporate strategic planning addresses the portfolio of businesses owned by a firm. Of the three levels in strategic planning, corporate strategic planning is the broadest in scope. Decisions are made at these level limit choices that can be made t the lower levels. GE does this best overall by communicating the overall mission of the organization, and identifies the type of businesses that the firm wants to be in. For large multidimensional firms, key decisions in corporate strategy address what businesses to acquire and what to divest.
The strategy typically covers long time horizons, setting the overall value, direction and goals of the firm as a whole. It establishes how business performance will be measured and how risks will be managed as displayed by Gee’s CEO Jeffrey Melt producing innovation and sustainability (Swing et al, 2011). Supply Operations GE sets clear expectations for our suppliers, which are implemented through a very structured program with regular metrics. Every year, GE tryst to find ways to improve.
In 2011-12, the focus has been identifying the best way to work with our suppliers on resource efficiency and improving their overall execution capability (Melt, Chief Executive, 2012). With Gee’s assessment system, they led to improvements that enhanced the environment, health and safety (SHE) performance of Gee’s supply chain.
In 2011 alone, GE asked themselves if there were additional opportunities to ark with suppliers to achieve sustainable, long-term improvements in resource efficiency.
The key recommendations of the benchmarking were to continue to expand their collaborative approach with their suppliers, focusing on a few specific opportunities identified through lifestyle analysis or supplier suggestions, and to ask their suppliers for data only if they had specific use for the information producing the supplier relation management techniques (Swing et al, 2011, p. 299). Earlier efforts Ana snow at TN snouts use a Parent approach to Touch on ten Test opportunities. The Contamination Advisory Board was strongly supportive of the approach and its focus on collaborative efforts.
Implementation of Gee’s new approach is underway with “resource efficiency’ being now a part of Gee’s supplier expectations, which are incorporated by reference in Gee’s purchasing contracts. Gee’s measures of resource efficiency are core components in a new tool we are base-lining in 2012 with suppliers that are covered by the Supplier Responsibility Guidelines (Melt, Chief Executive, 2012). The new assessment tool includes a tiered scoring system for valuating a supplier’s management system and includes energy efficiency, greenhouse gas emissions and water usage.
The scoring tiers and elements required to reach each tier provide a pathway to future improvement. The new tool should encourage suppliers to achieve measurable improvements in resource efficiency, in a way that adds business value for both GE and its suppliers, avoids additional costs, and, where possible, addresses related critical compliance requirements. To encourage the sourcing teams to help suppliers with their resource efficiency, they added sourcing to their internal awards program.
The sourcing team has previously found great success using an internal award program designed to accelerate the use of diverse suppliers.
GE believes similar programs will allow them to further unlock the creativity of their sourcing teams to achieve increases in resource efficiency. By highlighting the efforts of forward-thinking employees and business partners, GE aims to accelerate the diffusion of collaborative projects that deliver real environmental and economic benefits to GE and our supplier’s altogether. Gee’s above approach will enable them to identify projects that are consistent with the hilltop’s underlying contamination, which will deliver both operational and environmental benefits without increasing our cost of supply (a key management expectation).
Furthermore, because many of Gee’s products are highly engineered, safety-critical and have long development cycles, any resource-efficiency ideas that could involve modifying Gee’s products or their components must be linked to their design and technology processes (Swing et al, 2011).
GE already identified opportunities in logistics management, metals recycling and packaging. For example, GE energy experienced massive growth in their wind businesses and an in the global hinted of parts and components needed for final assemblies in Florida and South Carolina.
During the same period, GE was piloting the use of lifestyle management tools to quantify their baseline transportation environmental footprint across their businesses. The team began by analyzing the weight of shipments, modes of transportation and distances, greenhouse gas (GAG) emissions associated with each mode and the total number of shipments. With calculations in hand, they worked with external consultants at the Massachusetts Institute of Technology (MIT) to verify agreements and validate our assumptions regarding the potential for reducing their footprints (Melt, Chief Executive, 2012).
Conclusion The insights gained through their supply analyses and the increase in demand for transportation within the wind business focused their attention on addressing the most energy-intensive transportation phases, including trucking critical components received at the Port of Long Beach to assembly facilities in the Southeast.
Given that the emissions associated with shipping by truck are seven times greater than those emulsions escalated Walt snapping Dye ocean Trendier Tort a given welling Ana assistance, GE identified alternative routes to increase the distance traveled by water and minimize the distance traveled over land.
Since taking action in 2009, GE Energy has achieved reductions in GAG emissions equivalent to taking more than 200 cars off the road and cost savings totaling nearly $9 million. Even during the economic collapse, GE made good decisions during the crisis that are benefiting major investors. GE invested in capital to weather the crisis and retain a strong business model. This required tough calls to be made, such as with raising equity in 2008 and outing the GE dividend in 2009.
Today, they have a competitively advantaged financial services business that is rewarding investors with strong earnings and growth (Melt, Chief Executive, 2012).
GE invested more in R;D each year, despite the tough economy. Their R;D spending has grown 54% from 2008 to 2011. GE invested for the long term, while cutting cost in less-essential areas. They manage to face the future with a stronger product pipeline than at any time in their previous history. GE sold their security business, completed the Joint venture of NBC with Compact and sold some non-core assets in GE Capital.