GE Talent Machine:

The making of a CEO

Prateek Sarin – PGP09219
Shankul Mishra – PGP09232
Sameet Khan – PGP09228
Ritu Singh – PGP09225
Sagar Rastogi – PGP09226
Raj Ratan Soren – PGP09222
Samiksha Jain – PGP09229
Shivam Gupta – PGP09235
  General Electric (GE) had been recognized as one of the world’s leading diversified
businesses
 GE always promoted its top leaders from its own ranks
 Followed a meritocracy based on measured performance

General  Coffin laid the foundation of the Talent Machine which produced a pool of skilled
managers that not only met the company’s own needs, but also became a major
Electric : An source of CEO talent for corporate America.
 Four successive CEOs each made the development of management talent a high
overview priority, and in doing so, made GE’s human resource management processes
among the most sophisticated in the world
 40% of the time was devoted to people issues
 History of GE’s HR Practices
Cordiner’s contribution : Strenghtneing the foundations(1958)

 Implemented a bold decentralization plan of responsibility and authority for making business decisions
 New corporate system : Session C, was designed to support an ongoing dialog about managers’ career interests
and development needs
 Session C Process Flow :- Generated evaluations , career forecasts and succession plan
 Each subordinated would compare their self evaluation with the boss
 Managers then prepared an Individual Career Forecast, rating each subordinate on a six-point scale from “high
potential” to “unsatisfactory.”

Systematizing HR Processes: Borsch and Jones(1972)

• Created a corporate Executive Manpower Staff (EMS) reporting directly to him

• Challenged business leaders to identify potential managerial talent from the engineers and
professionals on their staff

• Asked EMS consultants to participate fully in all Session C reviews, compile a central corporate
inventory on management talent
 GE’s HR Practices(Continued..)

Supercharging the System: Welch’s Initiatives(1981)

 Radically restructured the organization :- eliminated over 100,000 jobs

 Invested heavily in management development
 “Work Out” initiative : managers could discuss what was wrong at GE and how to fix it
 Follow-on commitment to “boundaryless behavior” signaled a cultural shift towards
breaking down the barriers that divided businesses, functions, and geographic regions
 Initiated an annual employee survey that polled employees on issues ranging from GE’s
overall attractiveness as an employer to personal job satisfaction and career opportunities
 By the end of Welch’s tenure, the formal HR systems were tightly integrated with the other
elements of what he called GE’s “operating system.”
  25-year-old Harvard MBA
 Entered on a commercial leadership track that included work
assignments in several different GE businesses
 Started as the Chairman and CEO of GEO in September 2001
 Immelt’s Priority: Leveraging Human Capital for Growth
Jeff Immelt
 Goal was to improve earnings at least 10% annually, with a 20%
plus return on total capital
 Growth strategy was based on five key elements: technological
leadership, services acceleration, enduring customer
relationships, resource reallocation, and globalization
 The Talent Machine in 2003
• The rankings-based vitality curve had long been one of the most
controversial elements of its HR practices
Vitality curve • Major area of concern was if the vitality curve be modified to
differentiate within the group

• Immelt was concerned if GE was not over-reliant on its U.S.-based

recruitment programs
Recruitment • Concerned if the company should reenergize its MBA recruiting
activities

• Employees felt that their promotion opportunities were limited

• Immelt was concerned if there was a need to compromise the
Executive Bands clarity and simplicity of GE’s management bands and create more
levels in the organization
  Appropriate reward and recognition for the
“the highly valued 70%”
 Expand global recruitment
Recommendation  To implement measures so as to increase
the frequency of clearly defined job
promotions
Thank you!