7/24/2019 Group1 GE Case

1/12

How difcult a challenge didWelch ace in 1981? How

e ectively did he take charge?

7/24/2019 Group1 GE Case

2/12

CHALLE !E"

Big shoes to fll

E#tre$ely high %ar &et u' %y (eg )one&

The Wall Street Journal 'roclai$ed

)one& a * management legend +

,eclared CE- o the year threeti$e&. CE- o the decade /u&t%e ore retire$ent

Econo$y hit %y rece&&ionin country0& highe&t e$rate& and !E had e$'loyee&

3ncrea&ed 'ro%le$ due intere&t rate& and &trong

4he co$'any needed re&tructured and that $oderni5ation and &trea$lo'eration&. down&i5iorgani5ation. reduction oand &tringent efciency $ea

Economic environmen

7/24/2019 Group1 GE Case

3/12

"et &tandard or each %u&ine&& needed to %e 1 or 6 co$'etitor in it& indu&try 7 or to di&engage

u&ine&& categori5ed a& Core :riority o reinve&ting in 'roductivity and ;ualityHigh

7/24/2019 Group1 GE Case

4/12

4he "econd "tage

Work -ut e&t:ractice&

!oing!lo%al

,evelo'ing

Leader&"econd Wave

"o tware3nitiative&

7/24/2019 Group1 GE Case

5/12

4he 4hird "tageoundaryl

e&&ehavior

"erviceu&ine&&e&

"i# "ig$a E< u&ine&&

4hird Wave

7/24/2019 Group1 GE Case

6/12

How i$'ortant i& Welch to !E0&&ucce&&? What are the

i$'lication& or hi& re'lace$ent

7/24/2019 Group1 GE Case

7/12

)ACB WELCH CE- ED4(A-(,3 A3(E

If you don't have a competitive advantage, don't compete Vision 4o re&tructure !E and to $ake each o it& %u&ine&& the 1 or 6 in their re&'ective indu&trie&F

METHOD TO THEMADNESS

(educed the nu$%er o layer&head;uarter& grou'

"'earheaded a $a/or de

7/24/2019 Group1 GE Case

8/12

)ACB WELCH CE- ED4(A-(,3 A3(E

Created the Work-ut 'rogra$. where$anage$ent and e$'loyee& were givena oru$ where they could e#'lore newway& o working together

The %E &or'(ut )rogram Best )ractices )rogram3t wa& created in an e ort to learn ro$other co$'anie& and identi y therea&on or their &ucce&&e&

Ada'ted the Hu$an (e&ource ,e'art$ent to all in line with the overall cor'orate goal&

Challenged $anager& to identi y uture leader&. and then develo'ed training 'rogra$& and develo'$ental'lan& or all key /o%&

Created the "tretch 'rogra$$e to get 'eo'le to think o unda$entally %etter way& o doing their work

3n&i&ted on %uilding a ca'a%le tea$ to guide !E0& &ucce&& or the 're&ent and the uture

* enti+"ing Future ea ers

Clearly co$$unicate vi&ionContinue to o&ter o'en co$$unication. tea$work. innovation needed

Create 'rogra$& to o&ter e$'loyer e$'loyee relation&hi'&

Challenges +or his Successor

7/24/2019 Group1 GE Case

9/12

,i&cu&& your view& on how &uch a large.co$'le# diver&i ed conglo$erate cancontinue to grow &o 'ro ta%lyF How have

Welch0& variou& initiative& added value?

7/24/2019 Group1 GE Case

10/12

Co$'le# diver&i ed conglo$erate having divi&ion& and 192de'art$ent& &u''orting > %u&ine&& unit&Were aced with a rece&&ion. high une$'loy$ent. high intere&t rate&.and an overvalued JF" ,ollar

"trategy wa& not /u&t a%out %uilding a 'o&ition o &u&tained co$'etitiveadvantage3t a& a%out creating &ucce&&ive te$'orary advantage&3t can %e done %y or$ation and i$'le$entation o a &trategy %a&ed onthe develo'$ent o ti$ely re&'on&e& and Ke#i%ilityAchieving &uch o%/ective& re;uired recon guration o organi5ation0&re&ource& and co$'etence&3n ti$e& o uncertaintie& and rece&&ion. the nor$al cour&e o action or$any %u&ine&&e& i& to engage in co&tcutting &trategie&. %ut &tudie&de$on&trate that &uch &trategie& are not alway& &ufcientF

Co&t Cutting 3nve&t$ent

&hen &elch $oine

&elch-s .a" out

7/24/2019 Group1 GE Case

11/12

4hrough thi& &trategy co$'any analy&ed > %u&ine&&e& under itonly tho&e %u&ine&&e& that were nu$%er one and two in their re&'ectiveindu&trie& were $aintained-ther& were &old or clo&ed down

u&ine&&e& that were $aintained %eca$e the centre o &trategic inve&t$ent&

3n order to o'erate e ective and efcient world cla&& %u&ine&&.and &u&tain nu$%er one or two 'o&ition& in indu&try. inve&t in the right

%u&ine&&e& and develo' &ta & that are the %e&t at what they do

!E had ac;uired r$& that ena%led it to e#'and glo%ally and develo'ed glo%alo'eration&that re&ulted in the co$'any al$o&t dou%ling it& international revenue to 6F8%illion co$'any %eca$e lean and agile. with increa&ed efciency and organi5ationalculturetran& or$ation&ervice %u&ine&& wa& added whichcontri%uted to two

7/24/2019 Group1 GE Case

12/12

4HA B -JO