Strategic Management - II Section F Group 10

1) List the strategic initiatives that Jack Welch had in his 2 decades as CEO of GE. Of these, which, in your
view, is the most impactful? Why?
Since Jack Welch became CEO of General Electric during the US recession, he implemented several strategic
initiatives enumerated below:
1. He categorized the businesses into Core, focusing on productivity and quality; High-Technology, focusing on
investing in R&D; and Services, adding outstanding people and making contiguous acquisitions).
2. He came up with the "Fix, Sell, or Close" model to improve competitiveness and quality in various arms of
GE while effectively dealing with non-competitive businesses.
3. He gradually reduced the bureaucratic nature of the organization in the process; he replaced the Strategic
Planning system with Real-time Planning System.
4. Welch achieved a "Lean and Agile" GE through downsizing, destaffing, and delayering, per his vision.
5. In line with the cultural changes he wanted to bring, he came up with "Work-out" and "Best Practices."
6. Welch appointed Paolo Fresco as head of the international operation in going global and became the locator
and champion of new opportunities while allowing each business to implement plans according to its needs.
7. Welch asked the top executives to identify the future leaders and outline planned training and development to
safeguard the future leadership at GE.
8. Implemented a model in which stock options became the primary component of management compensation.
9. Implemented multi-dimensional performance evaluation (360-degree feedback and GE Values) to identify and
develop leaders within GE.
10. “Boundaryless company”: focused on creating an open, knowledge-sharing, distinctiveness organization.
11. Introduced “stretch” targets to motivate employees to push limits and improve performance.
12. Pushed for product services and acquired service companies to reduce dependence on industrial products.
13. Announced the “Six Sigma Quality Initiative” to improve products, profitability, employee satisfaction and
productivity, while reducing losses and inefficiencies.
14. Oversaw the final performance appraisal system to meet the company’s need for exceptional leadership talent
and “weed out poor performers”.

In our opinion, “Boundaryless Company” was Welch’s most impactful initiative. It promoted knowledge-sharing at a
time that the company was focusing on internationalization, facilitating faster and improved decision-making,
removing barriers across departments, and developing cross-functional teams of highly productive, efficient leaders.
These measures set the tone for GE as it entered the era globalized business while enhancing the acquisition process
(370 entities in Welch’s tenure), promoting competitiveness.

2) What do you think is the issue with Harry? Is it a problem of attitude or skills? Substantiate.
There is no denial of the fact that Harry is a top performer and has been efficiently running the operations of the
business. Harry is a skilled executive, but he let the channel stuffing issue snowball into a lawsuit against the
company. So, there is a severe problem with his attitude. The following instances from the case substantiate our stand:
1. When Harry received the complaint, he passed the buck to Terry, his subordinate, rather than referring the
matter to the ethics officer.
2. Despite passing the buck to Terry, he failed to follow up with him and let Greg Wilson (Divisional Sales
Manager), the alleged offender, abruptly leave his job.
3. Harry did not abide by the corporate governance standards by not appraising the board (ethics committee and
audit committee) of the channel stuffing by Greg Wilson.
4. Having received a complaint and being in the firm's top management, Harry automatically becomes a party to
the investigation. However, he was absent on two occasions, citing that he was busy closing an acquisition
deal and rebuilding the damages caused to the factories by hurricanes.
5. Harry turned a blind eye to Mike's termination. It signaled that it was retaliation for Mike's whistle-blowing
and prompted him to sue the company.