General Electric Case

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Before Jack Welch stepped up into corporate office position, the world-famous corporation was on its route for imminent crisis which was barely noticed by anyone. As a result, he decided the company needed a change to combat economic and competitive challenges of the market place. With his various strategies regarding business leadership, he has led the company into salient and radical revolution of corporate restructuring, with the goal of transforming GE into a global leader for benchmarking and achieving maximized productivity and labor efficiency. His tactics for restructuring included purchases and sales of business units, moving away from bureaucratic culture and structure to one of openness and flexibility, removing unnecessary layers of middle-management and laying off thousands of employees and creating new rewards and recognition system. The result was that in 1991Welch anticipated to receive 5 dollars in sales for every dollar of working capital invested in 1991 thus making it one of the most profitable firms in America. However such dramatic undertakings created for Jack Welch challenges due to internal resistances stemming from cultural and personal values and beliefs.

There were a number of issues that I have come across when reading this article. Many of the concerns facing GE originated from bureaucratic structure of the company that was present in the organization since its establishment. Jack Welch, when elected CEO, saw that routine loads of paperwork, prolonged procedures of decision making and a centralized, rigid hierarchy no longer were effective for the company. Resources and human capital were not utilized efficiently and he immediately set on the path of organizational restruct...

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...n people. He might make decisions that will be contrary to what employees expect from their job positions, such as the decision to reward only the brightest workers. This might create dissatisfaction among personnel with the conditions of work, causing some people to abandon GE. Jack should analyze and evaluate each decision very scrupulously making sure that it is compliant with employees' expectations as well as his goal in metamorphosing GE.

For change to be effective, CEO should act immediately to instill his values and visions among employees of the company to help them understand and support this radical ‘revolution'. Employees need to "understand the why, then they are more likely to accept the what". Creating an open collaborative workplace where everyone's opinion is welcome is the key to successfully achieving a truly boundary-less company.

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