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GE Jack Welch
GE has been able to pursue unrelated diversification for a few reasons. Most important is that the corporate level contribution has been limited to management practice. GE contributed systems to its subsidiaries, but allowed managers to run their own businesses, and not be tied to trying to work with other subsidiaries. GE contributes best practices that help managers of all businesses to operate more effectively, but corporate head office does not interfere in the management of the business. Another contributing factor is Welch's "fix, sell or close" strategy. This resulted in many businesses being divested -- too often firms engaged in unrelated diversification persist with bad businesses either because those businesses are related to other subsidiaries (like FedEx with Kinko's) or because management does not understand the unrelated businesses.
One of the areas where GE succeeded was in leadership development. Running disparate...
It may be the case that many other firms attempting unrelated diversification build leadership talent well, but then funnel leaders into the core business. At GE, there was no such concept of core business beyond whatever businesses were the most profitable and had the best potential. Managers could excel in any subsidiary, and this helped GE to maintain a successful diversified portfolio of companies.
Another contributor to the company's performance is the internal competition. While the constituent companies of GE may not have all been in the same business, they all sought to compete with one another for performance and recognition. They became adept at adopting best practices from other GE companies, so even when the firms were in different businesses they were able to learn from each other. The…
This would be something that was difficult for most competitors to match, and would therefore provide GE with a source of sustainable competitive advantage. Welch also saw decision-making speed as essential to his change process. He reduced the amount of paperwork and study relating to decisions to both free up the flow of valuable information and to speed up the decision-making process. Again, this was a means of differentiating the
Jack Welch Leadership Strategies Jack Welch is rated as the greatest CEO of the current generation and one of the greatest business leaders of all times. The legendary leader, donned the top post in General Electric (GE) from April 1981 to September 2001, taking the company from mediocre levels to the very top levels, in the process turning the very basic concepts on which businesses were run till then. When he
In order to make the company successful and create a good image, Immelt had to do some rebuilding. He first had to rebalance the company's portfolio which included investing in media companies in order to be positioned for the digital future. Next, he wanted to place a high priority on servicing the customers through hiring a strong marketing team familiar with customer needs. He knew he had create new processes
Welch Leadership Development Center. The reason why these areas are important is because they are working to create a basic foundation of leadership skills. As, having young managers are learning the proper leadership techniques that will help them to be able to understand how to effectively work with staff members. Once this occurs, is when they will learn the different ways to reach out to them and motivate each
CEO General Electric (GE) is one of the world's most renowned companies involved in the production, distribution and the use of electrical products globally. The business was started in 1978. It has developed to be the best performing and highly competitive organizations by providing quality products to its consumers. Much of the performance of the GE Company is highly attributed to the nature of leadership adopted to ensure the maintenance
This shift in organizational structure also required the entire corporation to shift from centralized to decentralized decision making. The approaches GE took to ensure the shift in structure and decision making would work included putting output and behavioral controls into place for each business unit. The output and behavioral controls were specifically designed to ensure each independently operating business unit shared accountability for corporate results yet also had the