Jeff Immelt and the New GE Way: Innovation, Transformation and Winning in the 21st Century

Few things are more challenging for a new chief executive than following in the footsteps of a corporate legend, but that is what Jeffrey R. Immelt had to do when he succeeded Jack Welch as chairman and CEO of General Electric (GE). In this comprehensive portrait of a talented young CEO who has overcome tough challenges, David Magee, the author of respected books on Toyota, Nissan, Ford and John Deere, traces Immelt's rise to the top of GE's competitive management ladder. Magee provides Immelt's complete background and limns his GE career with an emphasis on the problems he addressed and the values that support his strategic decisions. getAbstract recommends this saga as a well-reported inside look at global strategy in the making.

I love reading books about great leaders. They inspire me. Like what Immelt said "We are never as good as we can be". So I study. Immelt had a tough and very public act to follow in Jack Welch. From reading the book, I prefer Immelt's style more than Welch's. The book is polite and makes few comparisons but it is easy to glean from reading. The book is meant to give insights into lessons a leader can learn from Immelt. And there is much that can be learned. Much is simple (one of the goals of GE is to make things simple). EG ask questions and listen to the answers. Every book I have read about GE stresses the need for details and processes. Part of any companies success is digging in. Doing the work and knowing the details. Details and processes win. Immelt's personal strategy for overcoming tough times: "Commit to learn everyday (you need an incredible thirst for knowledge) work hard with passion (competence and energy solve most problems) Give people a reason to trust (the world is more selective today - trust is a differentiator) Have confidence (Understand that you can make a difference) Be an optimist (cynicism is corrosive)" I was impressed that GE never backed off training, even in tough times. I believe tough times is a good time to invest in training. Partly because change is required and training helps foster positive change and partly because usually there is some surplus capacity so staff have the time. I resonate with Immelt "I'm a learner, and most good leaders that I like are the same way". GE's core values according to Immelt are: Integrity Performance Change These look simple. I would have added more definition. EG change for the sake of change is not good. It is "appropriate change" that needs to be sought. Immelt says "constant reinvention is a central necessity". I liked what Immelt teaches young leaders: 1 - take personal responsibility 2 - Simplify constantly 3 - Understand depth, breadth and context 4 - Focus on alignment and Time Management. (and no I did not make that one up) 5 - Learn constantly and learn how to teach. (and I would add learn how to learn faster and better) 6 - Stay true to your own personal style. 7 - Mange by setting boundaries, but allow freedom in the middle. 8 - be disciplined and detailed. 9 - Leave a few things unsaid 10 - Put people first (interesting since this has not been a GE trait - I agree - see my review of Primal Management) As a small shareholder in GE, it is tough to be objective since my investment returns have been less than the index. But when I look at the true facts, GE has actually performed well (not the stock - the company). In the 6 years from 2001 to 2007, sales and earnings both increased by 60% while the stock price dropped 7%. And since then, the stock has dropped by 66%! So poor investment. Maturity is being able to learn from people regardless of circumstance so I hope I have learned despite losses in the stock market. The book is well written. Macgee is

David Magee's "Jeff Immelt and the New GE Way" is a fine companion to Robert Slater's "Jack Welch" series of books in the '90's. As a GE employee in the late '90's - early '00's, Mr. Slater's books were encouraged reading. As difficult as it is to succeed a legendary CEO like Mr. Welch, Mr. Magee restrains himnself from drawing too many comparisons to Mr. Immelt's tenure, but not completely. Mr. Immelt is a different leader for a different time, but certainly benefits from the innovative leadership and results-oriented culture that defined Mr. Welch's tenure. As a leader, Mr. Immelt stands on his own two feet, and has defined his tenure with two (but not only two) very important initiatives that not only differentiates him from Mr. Welch, but well positions GE for the times we live in, and for the future. First, and most critical, is Mr. Immelt's investments in research & development as part of his strategy for organic growth, rather than short term results fueled by acquisitions. This builds upon a traditional strength of GE - their ability to innovate and bring unique products and services to market that also leverages GE's boundaryless culture to benefit all of their business units, from Energy to NBC. Mr. Immelt's vision is for R & D not only to benefit GE in the present, but demands and rewards his executives for proposing "ideas" that will benefit the company 10, 15, or 20 years into the future. His "ecomagination" initiative is part of this vision. The second important initiaitve is Mr. Immelt's focus on two important growth areas: medical technologies and infrastructure. While many know GE from their washers, dryers, water coolers, and light bulbs, and these businesses are profitable, they are slow growth and low margin businesses. The future is in harnessing medical technologies and energy and technical infrastructure on a global scale. This is where the growth will come from for the next 25 years. Mr. Magee also correctly points out that GE's stock is trading below its value, a point that Mr. Immelt is making, quite correctly, to anyone that will listen. GE seems to be oversimplified by analysts or by the popular business media - they lump it in with other companies that are only marginally related. If the banking sector is getting pummeled, GE is pummeled because of it's GE Capital unit; if advertising is in the tank, GE stock goes down because of their NBC unit; if AIG, GM, Lehman Brothers, and Enron can fail..... and so it goes. What everyone is ignoring is that GE is a diversified, global, profitable, growing, and healthy company! Their ability to not only turn profits, but grow, in this economic environment, in addition to Mr. Immelt's investments for the future of the company, make GE a no-brainer investment. Recent stories in the media calling for Mr. Immelt to shed underperforming businesses, or even more laughable, quit (!), demonstrates a limited knowedge of the company, it's business model, and it's undeni

At General Electric, the chairman and CEO selects his successor, subject to confirmation by the board of directors. Almost 30 years ago, Reginald Jones selected Jack Welch and urged him to "blow up GE." Both he and Welch realized that the "Welch way" had to replace the "Jones way." During the next 12-18 months, Welch became known as "Neutron Jack" as he made numerous and significant changes throughout GE, systematically and summarily eliminating both unprofitable businesses and underproductive people. What we have in David Magee's book is, to the best of my knowledge, the first comprehensive examination of Jeff Immelt's leadership as GE's current chairman and CEO. Prior to being selected by Welch and then confirmed by GE's board of directors as the company's chairman and CEO in 2001, he held a succession of increasingly more important executive positions in various GE divisions (e.g. Plastics, Appliances, Plastics Americas, and Medical Systems) after earning an M.B.A. degree from Harvard University's Graduate School of Business in 1982. He soon caught Welch's eye and was generally viewed as a fast tracker among the company's younger executives. He was promoted to be vice president and general manager of GE Plastics, overseeing 5,000 employees and $3 billion in business. But after a promising first year, Immelt was slow to inflationary forces in the global plastics market. His division took a heavy toll in both sales and profits. Immelt was required to attend the annual meeting of GE's top executives in 1995 and successfully avoided Welch and his wrath for three days. Finally, Welch caught up to him. "Jeff, I'm your biggest fan, but you just had the worst year in the company. Just the worst year. I love you, and I know you can do better. But I'm going to take you out if you can't get it fixed." Everyone knew that Immelt was in an especially difficult situation. However, Immelt accepted the harsh criticism ("I took a couple pf real ass chewings from Jack") and, under severe pressure, showed exceptional toughness and problem-solving abilities as well as composure and self-confidence. He and the division emerged from this "trial by fire." Although Magee includes a great deal of information about GE, most of it has already been discussed in dozens of other books, notably those written by Welch himself as well as by Stephen Baum and Dave Conti, Jeffrey Krames, Bill Lane, William Rothschild, Robert Slater, Noel Tichy, and Dave Ulrich. The focus of this book is not on GE, however, but on Immelt. Here are some of Magee's observations and insights that caught my eye: "Age might have been a tilting factor in Immelt's favor as well [as being `comfortable in his own skin]. Seven years younger than [one contender, Jim] McNerney and eight years younger than [another, Bob] Nardelli, Immelt could make a 20-year run as GE's leader just as Welch did while McNerney and Nardelli reasonably could not have lasted more than a decade and a half." (Page 33) "After