GE: Organizational Change Mangement

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This best-selling Change Management Toolkit delivers to you and your organization a breakthrough, easy-to-follow guide on how to manage and implement change 

 

General Electric is one of the biggest companies in the world today.  But this did not
happen overnight.  During the 1980s, GEs market capitalization was about $12 billion.
But by the end of the 20th century, they have increased their capitalization by over $500
billion.  This is due to some radical organizational and management changes initiated by
GE through its CEO Mr. Jack Welch.  The management of organizational change for GE
was also handled by Welch which earned him the title “Manager of the Centrury” by
Fortune Magazine.

The 1980s brought about many organizational changes in GE to make it more globally
competitive.  In order to do this, several unprofitable companies were closed, many
unperforming managers were asked to leave, inventories were trimmed and old line units
were eliminated.  The philosophy of this organizational change was to either be number
one in the industry or else just drop everything and start over.  This management for
organizational change was greatly criticized but soon became a standard and adopted by
other CEOs in many American companies.

GE also adopted Motorola’s Six Sigma in 1995 to help in the management of its
organizational change and this greatly boosted its revenues.  The basic concept of the Six
Sigma was to produce a specified output in order to eradicate the defects of production.
This can be done through a standard form of non-varying processes which can be
measured, analyzed, improved upon and controlled.

In applying Six Sigma and developing their own unique learning styles in management,
the goal of GE to become the world’s most competitive enterprise has become a reality.
Because the management of organizational change for GE was so revolutionary in the
1980s, may companies have now made management through leadership a rallying point it
its organizational change.