Is it possible to be a century-old global corporation while also being on the forefront of innovation? According to GE’s recent successes, it definitely is.
Earlier this year, the Harvard Business review published an article by GE’s Chairman & CEO, Jeffrey R. Immelt. In the article, he describes how he transformed GE from a “classic conglomerate” into a “125-year-old start-up.”
“Even before becoming CEO, I believed that the company couldn’t simultaneously be good at media, pet insurance, and making jet engines,” Immelt wrote. “Our portfolio was simply too broad and too opaque. One business had no idea what another business did. No one in leadership really understood the GE Capital balance sheet. And many of our industrial businesses had commoditized.”
So what did Immelt do? He set out to remake GE. He began this journey in 2001, when the future of the world seemed particularly uncertain, and the initiatives he spearheaded still drive GE’s successes today.
“Although we’re still on the journey, we’ve made great strides in revamping our strategy, portfolio, global footprint, workforce, and culture,” he wrote. “We’re on a 40-step journey. Today we’re on step 22. I don’t know exactly what step 32 looks like yet. But we’re going to explore that together. And we will do whatever it takes to be successful.”
Though you’re probably not running a company the size of GE (but kudos to you if you are!), there are a lot of leadership lessons to be learned from Immelt’s tenure as chairman and CEO. One mantra in particular stands out as crucial to GE’s transformative success, and it’s something that Immelt himself views as crucial to the survival of a company:
Go “all in.”
By “all in,” Immelt doesn’t just mean“show an interest in.” Going all in means more than “wanting to learn more about” or “purchasing a small stake in.” Those are great starting points, but the impact of one’s actions must be much more significant in order to fully transform a company.
“When you get to the point where you believe to your core that things have fundamentally changed — when you feel that if we don’t do it, it’s going to get done to us — it’s time to act and to engage the organization,” Immelt said about leading changes in times of industry upheaval. “I hate to say it, but transformation takes time. If change is easy, it is not sustainable.”
Immelt explains that you can’t regard any sort of transformation as an experiment. “Half measures are death for big companies,” he wrote. “People can smell lack of commitment. When you undertake a transformation, you should be prepared to go all the way to the end.”
Also read: Leading Your Organization — What Fuels You?
In the latter half of Immelt’s tenure, GE became very interested in additive manufacturing, a.k.a. 3-D printing. The company saw it as a strong asset for many of its businesses and began to look into the possibility of turning additive manufacturing into a standalone business. “We could see a way to automate it. We could see it being very disruptive — making what we want, where we want, with workers who are more productive and more valuable,” Immelt wrote.
And so, GE was ready to commit. In 2016, the company purchased controlling shares of Concept Laser and Arcam. The price was steep — about a billion and a half dollars for both companies — but in Immelt’s eyes, it was worth it.
“They gave GE a market share of about 20 percent in the additive-equipment market,” he explained. “Even for a company our size, once you make a move like that, you’re committed. You’re investing serious money. You’re driving it across the company… [you have] to be disciplined about nesting initiatives within one another — showing how each one fits with the rest — and staying away from new ideas that don’t fit.”
It takes strong leadership and training to successfully usher those changes through an organization and eventually, an industry. Grit and perseverance are definitely mandatory, but there are additional ways you can support yourself in making transformative change, including:
- Have a clear goal. What is the force that is driving your need for change? Hone in on that and use it to drive your initiatives forward. Make sure that whatever actions you take help in reaching that goal.
- Turn mistakes into opportunities. Like many other companies, GE was adversely affected by the Great Recession of 2008. Instead of finding a scapegoat, Immelt worked to turn the fallout into an opportunity to grow its aviation business. “We fixed the problems,” Immelt wrote in the Harvard Business Review piece. “And a better company emerged.”
- Listen. According to Immelt, the best leaders are also the most curious. Take advantage of every opportunity to learn from your network and really process everything you’re learning. Immelt recommends a “soak period” where you spend a long amount of time actively digesting new information before acting on it.
- Embrace new talent. In order to become a global company, GE had to learn how to access talent from across the world. When Immelt started as CEO in 2001, 20 percent of GE’s officers were women, were from outside the United States, or were minorities. As of 2017, that number has skyrocketed to 59 percent and shows no signs of slowing down.
Immelt is aware that different leaders are responsible for different things. Some need to build a company from the ground up. Some need to manage momentum through a period of exceptional growth. In Immelt’s case, his need was to remake the company into a digital powerhouse. By committing to the need for change and opening GE up to new opportunities, he has no doubt succeeded.
—Alex Wilson via Fairygodboss