General Electric: Managing Change at the Top

I know, I know I am dating myself but I can clearly see the headlines “Neutron Jack Axes…” I have closely followed the evolution of GE since then through all their major initiatives and dramatic growth. They were and are a stellar example of corporate prosperity. But at what cost?

Since Jack Welch has left, Jeffrey Immelt, CEO has begun another transformation at GE. Not easy since General Electric, is larger than most governments. Yet as a result, it is equipped to wield significantly more influence over business practices, even governments, around the world. With this power, GE can accomplish social change on a grand scale. In pursuit of this mission, GE is exploring innovation in renewable energy, reducing its environmental impact in manufacturing and consumption, and contributing to the lives of both employees and community members. Wow! Would Jack still recognize the company?

At the forefront of GE’s approach to corporate citizenship is its “ecomagination” campaign. Ecomagination entails the use of forward-looking, almost imaginative, technology to change the future. With unique fuel-efficient products, renewable energy sources, and more efficient transportation, GE hopes to reduce the stress it puts on the environment through the development of ideas and manufacturing of products. Not limited only to consumer goods, the ecomagination vision extends across all GE business units, including aircraft engines (GEnx™ Engine ) and railroad equipment (Hybrid Locomotive). For example, the new locomotive hybrig engine is being designed “to reduce carbon dioxide emissions over its lifetime as much as taking 2,600 cars off the road for a year”.

Through ecomagination, GE integrates its commitment to a cleaner future into its current research and development activities. This practice results in a pipeline of environmentally friendly practices that will continue to yield benefits in the future, as opposed to limited measures in the present that generate only small changes. GE does not disregard the present, with business lines in renewable energy involving wind and water power and including energy efficiency into consumer and business products. In order to release ecomaginative products on an ongoing basis, though, GE has to plan ahead. Over time, new environmentally friendly solutions reach the market, but GE continues to look to the future, adding projects that will pay off sometimes twenty years from now. Brian Grow, Steve Hamm and Louise Lee of Businessweek magazine wrote and excellent article called The Debate over Doing Good where they examine this new GE strategy.

GE has a unique place in the market. Compared to nearly every other company on the market, GE has an amazing amount of financial resources, engineering talent, and marketing savvy. This enables the conglomerate to succeed in almost everything it does, and it gives the company substantial latitude in the decisions it makes. Smaller though still successful companies simply do not have the resources to invest in projects that may take decades to come to fruition. GE, can invest for the near-term and the distant future – releasing innovation to help the environment today while developing profound technological changes to shift consumer and business behavior decades from now.

To learn more about GE and its “ecomagination”, go to http://ge.ecomagination.com/@v=08042006_1457@/index.html.

Friday, September 22, 2006