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It’s rare for an ex-ceo to publicly criticize his successor but Jack Welch leveled a harsh blast against GE’s Jeff Immelt days after the company announced a surprise drop in earnings right after Immelt promised it would meet its rich financial targets.
This is what Welch said: “Here’s the screw-up: you made a promise that you’d deliver this and you miss three weeks later,’’ Mr Welch said on GE-owned CNBC. “Jeff has a credibility issue. He’s getting his ass kicked. He apologised. Things happen fast.’’
What happened was the collapse of Bear Stearns and the meltdown in the credit markets. What happened was the sharp decline in the US economy and the beginnings of a slowdown in India and other overseas
markets that GE plays in.
But I wonder at the image of Welch criticizing Immelt. Under Jack, GE ran the tightest of Six Sigma ships, focussing on cost and efficiency and delivering slightly higher returns every quarter. It was all about control.
Immelt dramatically reshuffled GE's portfolio of operations, going green, going global. He began to build a social system of innovation at GE, using P&G's Lafley and others to help him. GE has a long way to go--it is probably further behind P&G in building an innovation culture and is still mired in a by-the-numbers culture.
But GE is much more innovative today under Jeff than Jack. GE was on our Most Innovative Companies list for 2007. What do you think for 2008?
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