LEADERSHIP AND STRATEGY: GE AS AN EXAMPLE

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Date (optional). Leadership in business is primarily defined as the action of governing a group of individuals in an organization. It mainly involves establishing and sharing a clear vision that others willingly abide with, balancing and coordinating the members’ conflicting interest, and also providing the knowledge, methods and information to achieve the specific vision (Rugman, 2003). A strategy, on the other hand, is an actionable plan or policy geared towards the achievement of an overall aim (Aaker, 1984). Strong leadership is a strong factor in any organization regardless of the market conditions. Proper leaders give the workforce of an organization the required motivation, pride, direction, and a sense of purpose while at the same time communicating confidence and strength to the market and competitors. Different companies may require deferent kinds of leadership structure or methods and structure to achieve their pre-defined aims. This paper’s purpose is to highlight the leadership and strategies employed by General Electric Company.
In General Electric’s annual report in the year 2000, it was claimed that the core competency of the organization rested in its ability to recruit and nurture the best people all over the globe. These recruits were then to be cultivated to have a desire to learn, stretch, and do things in a better manner. The performance evaluation of General Electric was and is still famous for its ruthlessness and rigor.

Annually, the top 20% performing employees are both recognized and awarded for their efforts while the bottom 10% face the risk of being fired from the organization. The average employees, on the other hand, are usually motivated to either join the top 20% or risk joining the bottom 10%. General Electric thus continues to stretch the targets of performance through financial control, strategic planning, and management of its human capital.
There are several initiatives that the leadership of General Electric has introduced to improve the performance of the company. Among these initiatives are work-out, digitization globalization, boundaryless organization, and six sigma initiatives. Work-out is a platform where a cross-section of workers from different departments is asked to speak openly about the practices of management in their respective departments without the dreaded fear of retribution. Whenever each session ends, the manager of the group returns to listen to the results, proposed recommendations and make decisions based on the proposed recommendations on what actions need to be taken moving forward. This initiative proves useful time and time again because the workers can give their honest opinions and thus help in making the organization more efficient than it was and thus create a working environment that is conducive.
The boundaryless organization, on the other hand, focuses on blurring both external and internal boundaries of General Electric via the sharing of information, cross-business learning, and integrating key suppliers into the end-to-end processes of General Electric. This practice results in the translating of diversity into an edge in the competition for the company and thus creates less friction. Globalization is the process via which companies, people, and governments integrate and interact through investment and international trade. General Electric used this initiative of globalization to exploit the economies of scale at an international level and taking vast advantage of opportunities that arose globally. General Electric has acquired various distressed assets during the financial crisis to leverage off during the recovery period of the economy. This company has profited several times from this approach like during the economic crisis in Asia, the Mexican crisis, and the European and US recessions, resulting, in General, Electric amassing undervalued but quality assets.
Six Sigma is a method formulated by Motorola but was massively implemented by General Electric in the entire organization. Six Sigma is a quantitative analysis process for measuring, defining, controlling, and improving various aspects of the corporate structure. This system of six sigma results in the achievement of financial goals that tend to be measurable in any project that the system is applied. Digitization, on the other hand, was introduced in the year 1999 where the managers of General Electric were required to visualize how their respective lines would be crushed. Digitization created a platform for improvements to be made in the internal process of the company and in discovering potential market opportunities that seemed profitable.
GE has also utilized decentralization of the company and the diversification of its services and products. It could find ways to minimize the costs of production resulting in the production of cheaper goods than the competitors. This process was achieved through the intensification of Research and Development activities. General Electric thus formulated a policy to sell its finished products at the cheapest price worldwide as long as a reasonable profit was realized.
In GE, there are various leadership roles with a set of behaviors that define the expectations for different leadership levels. This organization believes that its workforce should not only be judged on what activities they undertake, but also on the manner through which they do the said activities. It also believes in the evolution of leadership skills to counteract the changing objectives and the shifting market conditions.
In conclusion, the competitive advantage that General Electric holds is as a result of intensive research supported by large expenditures for R&D, building countless improvements that are incremental, having leaders who are proactive and advent risk takers, and coming up with efficient initiatives to help in the improvement of the company processes.
References
Aaker, D. (1984). Developing business strategies. New York: Wiley.
Rugman, A. (2003). Leadership in international business education and research. Amsterdam: JAI.