During his 16 years as CEO, Jeffrey Immelt led a team of 300,000 people through recessions, bubbles, and geopolitical risk and engineered a radical makeover of GE, repositioning the firm as a digital industrial company looking to define the future of the internet of things.
Writing on the eve of his announcement to step down from the company’s helm, Immelt shares what he learned about leading a giant organization through massive changes. He outlines several lessons:
• Be disciplined. This means nesting initiatives within one another and staying away from new ideas that don’t fit.
• Soak. Effective leaders don’t react instantly to emerging trends; they read, contemplate, and listen until they believe to their cores that the world is profoundly changing.
• Make it existential. Every time Immelt drove a big change, he treated it as if it were life or death.
• Be all in. You can’t regard a transformation as an experiment—“You won’t get there if you’re a wuss,” Immelt says.
• Be resilient. Transformation requires staying power, and leaders need a thick skin to see it through.
• Be willing to pivot. Even as you’re making a major commitment of resources, you need to accept that you’re unlikely to get the strategy perfect out of the gate.
• Embrace new kinds of talent. GE now has more senior people from outside the company than at any time in its history and has increased its employment of women, minorities, and workers from outside the U.S. It has transformed its culture and operating rhythm, choosing speed over bureaucracy.
Immelt’s legacy at GE will be a complicated one. During his tenure earnings tripled and market share reached record highs, yet the P/E ratio plummeted and the stock price underperformed—no doubt in part because the payoff from some of his bets won’t be clear for a long time to come.
Like many other companies, GE under Immelt had to figure out how to balance serving local needs with the economies of worldwide scale. Harvard Business School’s Ranjay Gulati looks at how it tackled the challenge. He identifies several important takeaways for other multinationals: Give the local organizations clout, embrace creative abrasion, build strong functions, and eliminate strategic blind spots.
As GE has changed its mix of businesses and strategies, the profile of its workforce has changed, too: The company has hired thousands of digerati. These workers have little tolerance for the bureaucracy of a conventional multinational, posing new challenges to the company’s talent management. This article, by HBR senior editor Steven Prokesch, looks at how GE is using analytics to augment its core HR processes, with applications launched or in the works to address career and succession planning, training, identifying high potentials, helping employees form networks, talent retention, and cultural change.
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A CEO has different tasks in different cycles. Some CEOs are founders and builders. Others have the luxury of managing momentum through a stable economy or a period when business models aren’t being disrupted. My task was different: remaking a historic and iconic company during an extremely volatile time.
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