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Can GE’s management style work for you?

As a result of this column you will:

  • Promote A’s, offer training to B’s and fire C’s because they don’t support your values.
  • Redirect time and effort only to those willing to meet you half way.
  • Increase moral, productivity and profits by only keeping people who buy your values.

In 1998, Fortune magazine called GE’s upstate NY Crotonville training center the “Harvard of corporate America.” What can we in other business organizations learn from what’s taught there?

One primary lesson is that we all need to change the way we approach the three types of managers and employees who work for us.

  • Type A employees are high-performing team players who share GE’s values.
  • Type B employees share the values but fail to meet the numbers.
  • Type C employees simply do not buy into the company’s values.
Rather than focusing on getting and keeping the best people, many of us spend too much time trying to turn C’s into B’s. Conversely, GE insists that type C employees do not even belong at the company and should be fired. Type B’s should be nurtured in the hope that they might improve, and the A’s are to be rewarded, promoted, and well paid. Most business mistakes arise from not being able to face reality and only acting on it when it becomes undeniable. Those realities include the following: the world is becoming increasingly competitive, no job is guaranteed for life, and managing a business by bureaucracy no longer works. Additionally, leaders must act decisively. There is little use for managers who call meetings, set goals, and never follow up to see that the goals are achieved. At GE’s executive meetings, the same messages are hammered home each month.

  • Be number one or two in every market.
  • Fix, close, or sell.
  • Speed, simplicity, and self-confidence.

GE predicted that corporations that hung on to losing businesses out of a sense of tradition or sentiment would be gone. To be more competitive, they developed a strategy that required all GE businesses to be either first or second in their fields and exploit the competitive advantage of being the market leader.

You can’t be afraid to plagiarize and create a learning culture, and you should never claim to have all the right answers. Instead, GE reminds their people that the right answers are either somewhere else within GE, or they’re in another company. Wisdom doesn’t mean inventing the best ideas. Wisdom means having the ability to find them and then implementing them swiftly.

In the 1890’s, Thomas Edison was considered a hero because of his skills as a creator and inventor. A century later, you get to be a hero not just by inventing, but also by recognizing a good idea, wherever it is, and having your team implement it, as quickly as possible. Speed allows decisions to be made in minutes, face-to-face, rather than over weeks, memo-to-memo. However, speed for speed’s sake alone, can be deadly, as we’ll point out in a later chapter

Simplicity means that business is not complex. Everyone performs the same two basic functions. Either they function as inputs and/or outputs. The inputs are the same: people, energy, and physical space.

In engineering, simplicity means clean, functional designs with fewer parts that reach the market faster. Marketing delivers clear messages to consumers and plain-spoken proposals that make a quicker impact. Management communicates a simple, easy-to-understand vision, leading to faster decision making for all.

For self-confidence, leaders must overcome the fear of looking too simple. As GE’s Jack Welch says, “The way to sabotage your chances of producing great bottom-line results is to bog the organization down in complicated, distracting clutter.” It takes self-confidence to use and live with simplicity…but it’s well worth the effort.

This article is provided by Joe Murtagh, “The DreamSpeaker™” www.TheDreamSpeaker.com. For keynotes, facilitation, workshops, consulting and questions or or a free report on The 3 Most Common Mistakes Organizations Make, email us at Joe@TheDreamSpeaker.com or call 800-239-0058.

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