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Case Study Worksheet GE

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    This form can be used to organize your thoughts about a case. As you perform your analysis remain open to the fact that your interpretation of the facts may change and therefore you should constantly revisit your answers. Define the Problem: Describe the type of case and what problem(s) or issue(s) should be the focus of your analysis. Cases tend to fall into one of three categories that sometimes overlap:

    •  Decision Cases describe a decision faced by the case protagonist (character). The student ultimately must choose among a finite set of distinct decision alternatives.
    • Problem Cases require a student to diagnose a problem in a business case and to formulate possible solutions.
    • Evaluation Cases illustrate a business’s success or failure. The student analyzes the underlying reasons for that success or failure to arrive at management lessons. Evaluation Case

    An analysis of GE s revitalization efforts during the tenure of their infamous CEO Jack Welch. This detailed examination of the impact of Mr. Welch s leadership style and the changes he implemented. The learning objective is to understand the evaluation of Welch s strategy and how it impacted the company. There is no question that Welch had a positive and important effect on GE s long-term success. It is, however, important to note that this did not come without controversies. Though Welch did make appropriate changes which allowed for GE s success, the question remains; how does GE ensure that the post-welch era will continue to flourish without his guidance GE is a successful firm because they have the right resources aligned with the right attributes and characteristics. Welch strengthened their valuable resources which improved effectiveness and efficiency. This helped address opportunities and minimized threats. By understanding Welch s strategic management style and applying modern-day strategic analysis, we will conclude that GE will require someone who values the changes that Welch created for the company to succeed him.

    List any concepts that can be applied in the case: Write down any principles, frameworks, or theories that can be applied to this case. (Relate to the chapter understudy). He further emphasized this by creating things such as :

    1. Large meetings without bosses present,
    2. Opening the line of communication to where businesses reported to Welch directly, and
    3. Doing studies of other companies in order to extract what made them profitable and utilize it for the improvement of GE.
    4. Employees were allowed to purchase company stocks/options,
    5. Each employee was given a performance and feedback report by the company to be able to be run as effectively and profitably as a smaller company.
    6. List relevant qualitative data: evidence related to or based on the quality or character of something. (eg. Customer complains of the service). Challenges faced by Welch when he took over the position of CEO:
    7. SBU-based structure of the organization under the leadership of Reg jones
    8. The multilayer structure of  the organization with departments, divisions, groups and SBUs topped with an organizational layer of sectors
    9. U.S Economy in recession – High-Interest Rates, highest unemployment rate since the depression
    10. Global competition faced by the company- more often in the form of Japanese. GE at present was unable to face it to their full potential
    11. Bureaucracy structure of the organization leading to inefficiency and often delay, costing the company its edge
      List relevant quantitative data: evidence related to or based on the amount or number of something. (eg turnover rate is 10%)

    The Changes made under Welch s leadership: GE s sales got dramatically increased, more than double, from $10 billion to $22 billion. Earnings grew even faster, from $572 million to $1.4 billion). Internally, he built a constructive business-government dialogue, which contributed to the company achieving the expansion of world trade and restoration of U.S. competitiveness. April 1st, 1979, Jack Welch became the 8th Chairman and CEO of GE. He had to take the responsibility of taking over GE. At that moment, he faced challenges from both outside and inside of GE. The U.S economy was in a recession. High-interest rates and a strong dollar exacerbated the problem, resulting in the country s highest unemployment rate since the Depression. And also, the massive information and inefficient macro-business, which was due to the complex business structure, were making the business difficult to grow fast.

    1. CEO challenged each to be better than the best
    2. The two-tier approach of fixing- the hardware company s processes and structure and the software management style, culture, and structure
    3.  Risk-taking behavior is expected out of business heads and let go of the old GE culture

    Describe the results of your analysis: What evidence have you accumulated that supports one interpretation over another. (Keep in mind the theories, principles, framework) Welch Early Priorities: GE’s Restructuring

    To leverage performance in GE’s diverse portfolio of business, Welch challenged each to be better than the best and set in motion a series of changes that radically restructured the company.

    He believes in 3 important elements as such :

    1. Businesses were categorized as core (with the priority of reinvesting in productivity and quality)
    2. High technology (challenge to stay on the leading edge by investing in R&D)
    3. Services (required to add outstanding people and make contiguous acquisitions) The software Initiatives: Work out and Best Practices

    Jack believes the workout process is designed to get unnecessary bureaucratic work out of the system while providing a forum in which employees and their losses could work out new ways of dealing with each other. He also introduced employees to come out with proposals. The RULES boss had to decide whether the proposal is workable or not in front of others.

    Meanwhile, the Best Practice is to focus on how things are done in other organizations and implemented in GE s especially in increasing the productivity of the employees.

    Going Global

    The economic crisis in other regions had opened the opportunity for GE s for expanding. Ge buys over the organization by acquisitions and mergers. This can be considered as one of the strategic initiatives that have taken place in GE s. Globalization is not a one-time effort, but an ongoing theme. It has been proven in Japan, the company had spent $15 billion on acquisitions in 6 months. By 1998, international revenues were $42.8 billion, almost double the level just 5 years earlier. Global revenues were growing at almost 3 times the rate of domestic sales.

    Developing Leader

    Welch focuses on the task of realigning the skill sets and the mindsets of 290,00 employees. Welch has to encourage his employee to be more participative (candor behavior) don’t be afraid to speak up, friendliness, offer an attractive compensation plan. Jack introduce stock options and equity, by doing that the staff is also felt a sense of belongings.

    Create a base of leaders identified 4 types of leaders.
    Type 1 Deliver commitment and share GE values
    Type 2 Leaders don t meet commitment don t share GE values
    Type 3 Leaders who do not committed and have not achieved targets but share the values in GE s people can turn around
    Type 4 They deliver on commitment and do not share values.

    Welch is not happy with the type 4 leaders, thinking off to get rid of this type. He believes in people’s values.

    Boundaryless Behavior

    All departments and sectors should work together. A boundaryless organization will ignore or erase group labels such as management, salaried or hourly which get in the way of people working together. Stretch: Achieving Impossible

    Not only workers but dreamers should cum high to achieve. Put themselves above and beyond. Think big. Moving from local to globalization is proof. Will drive the organization become number 1, No punitive or penalty given if the Stretch is not made. Welch wanted the managers to work harder is not only target if achievable but looking for sustainability.

    Service Business

    Earlier focusing on products only. He instructed us to look back at all GE’s business and explore the new service-based for growth opportunities.

    Raising the Bar / Increased quality
    Six Sigma Quality Initiative

    Six sigma quality was more than a slogan, it was a well-developed program with a detailed plan for its implementation. GE s had invested $500 mill to train the entire professional workforce of 85000. In addition, 5,000 managers had been appointed to work on the program full-time as Black Belts and Master Black Belts. A Players with 4E s

    Create the A-Players Energy (excited by ideas and attracted to turbulence because of the opportunity it brings), ability to energize others (infecting people with their enthusiasm for an idea and having everyone dream the same big dreams), edge (ability to make tough calls), execution (the consistent ability to run vision into results) One more Initiative E-business focused on the challenges of redefining its business model before someone else did. Change is an opportunity, this is our greatest opportunity. GE had done the really hard work of building the assets needed to support e-business. Like strong brands, top-ranked product reliability, great fulfillment capability, and excellent service quality.

    Describe alternative actions: List and prioritize possible recommendations or actions that come out of your analysis. (Maximum of three (3) alternatives)

    1. The Lay off, downsizing, restructuring is challenging decision to be made. It should be done globalize. Not focus in the New York only
    2. Decision on the acquisition is the strategic plan. It should be continuously done. It will bring more profit to the organizations.
    3. Make a frequent involvement to the staff for decision-making process Describe your preferred action plan: Write a clear statement of what you
      would recommend including short, medium, and long-term steps to be carried out.

    HR planning

    1. Adapted HR system to his goals, and began keeping tabs on upper management. GE management expected feedback, which they used as the basis for coaching and developing their staff.
    2. Increased communication between CEO, and top managers, increased communication between top managers and lower employees, became means for training of new employees
    3. Managers learn about GE,  and experience debating and problem-solving, used as a hub for communications
    4. 360° Feedback process
    5. Became means for training needs, coaching opportunities, and career planning. A Players
    6. Managers with vision, leadership, energy, and courage
    7. Performance Appraisal System: Managers rated employees on a scale of 1-5, 5 being the lowest on the effectiveness
    8. All 5 s were to be let go, and all 1 s were to be rewarded with stock options, and higher promotional probability
    9. In the new culture, the role of the leader is to express a vision, get buy-in and implement it. Increased feedback communication and expectations in the organization In summary Jack Welch attributed towards management can be summarized in some simple ideas: eliminate vertical barriers like hierarchies, eliminate horizontal barriers by promoting programs like Work Out, globalization, encouraging people to talk, listen and be open to new ideas.

    Welch succeeded in his GE transformation by creating and opening communication channels, empowering employees at all levels of the organization, and allowing a new kind of teamwork that was unknown until then. All these factors combined motivated all employees to generate two decades of outstanding performance led by a great leader like Jack Welch.

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    Case Study Worksheet GE. (2016, May 11). Retrieved from

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