GE Talent Machine- The Making

of a CEO
Submitted By:
Group 2
Aleeva Goyari PGP09184
Ankush Verma PGP09185
Akhil Verma PGP09245
Jeevan Rathod PGP09186
Jagtap Sai PGP09190
Rahul Arora PGP09221
Puja Ashwini PGP09220
Sagar Rathee PGP09227
FABRIKAM
 CASE BACKGROUND

GE- World’s 1878: 1930: Pioneer 1950: 1990: Model

1970: Leader
largest leading Founded by of centralised Decentralised of lean and
in strategic
diversified Thomas corporate multidivisional agile global
planning
business Edison control organisation competitor

• Widely known for following model of modern management practice

• GE promoted top leader from it’s own organization
• Introduced by Charles Coffin, the executive development practices which
became the foundation of the GE’s well known culture
• Observers called it GE, “a CEO factory”

FABRIKAM 2
 MAJOR ACTORS
Ralph Cordiner, CEO 1958
• Implemented
decentralisation plan and
built Crotonville as a part of
it
• Designed a new corporate
system, known as Session C
• Created Position levels(PL) ,
a succession plan for
managers
Fred Borch, CEO 1972 Jack Welch, CEO 1981 Jeff Immelt, CEO 2001
Introduced Executive • Concentrated on • Focused on 5 key
Manpower Staff, which restructuring of the elements as growth
helped him manage GE’s company
executive as a corporate strategy:
• Eliminated over 100,000
resource a) Technological leadership
jobs
b) Services acceleration
• Work out initiative
c) Enduring customer
• Annual employee surveys relationships
• New view on recruiting d) Resource reallocation
e) Globalisation
FABRIKAM 3
Jeff Immelt, CEO 2001

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SESSION C: New Corporate System
Session C discussions focused on plans for promoting “high-
potential” employees, remedying “unsatisfactory” ratings, and
implementing succession plans

Employees filled the a self evaluation form

Managers prepared an Individual Career Forecast

Each sub ordinate was rated on a scale of 6 (high potential to

unsatisfactory)

Main 3 outputs:

• Individual evaluations
• Career forecasts
• Succession plans

FABRIKAM 5
 Executive Manpower Staff
Implemented by Fred Borsch

The system was implemented to help manage GE’s executive as a corporate resource

EMS focused only on jobs classified as PLs(Position Levels) 13 to 27 (top 2% of GE’s employees)

EMS consultants were called to participate fully in Session C reviews

These consultants were to compile a central corporate inventory on management talent, then track all “high-
potentials”

Through this process HR professionals eventually became the third member of each business manager’s inner
circle, along with the finance manager

FABRIKAM 6
Welch’s Initiatives
Position Levels were collapsed into 7 broader employee bands

MDC, BMC, EDC courses were recognized as preparation for next band
promotion

Introduced the “Work Out” initiative, around 200,000 employees met 2 or 3

days to discuss how a particular area of work could be made more efficient

Managers were evaluated not only on their performance against objectives,

but also on how they lived up to GE’s values

Welch added a disciplined performance management analysis to Session C

Vitality Curve

Highly Least
Top 20%
valued 70% effective 10%

FABRIKAM 7
 PROBLEMS
Turnover of GE’s most valuable employees was low

In 2003, HR data analysis showed that attrition from the highly valued 70% employees had increased

Should the vitality curve system be modified to differentiate within this group?

Was it time to question the entire concept of performance ranking at GE?

GE did not yet have the reputation to make it the employer of choice internationally

Should GE compromise the clarity and simplicity of GE’s management bands and create more levels in the organization,
particularly abroad?

FABRIKAM 8
RECOMMENDATIONS
Focus more on the
highly valued 70%,
introduce new awards
system for them

increase the frequency

Increase global
of clearly defined job
recruitment
promotions

Expand the Position

Level bands for other
countries

FABRIKAM 9
THANK YOU
Group 2
SECTION D

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