Jack Welch and Jeffrey Immelt - Continuity and Change in Strategy, Style and Culture at GE

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Case Details:

Case Code : LDEN040
Case Length : 22 Pages
Period : 1981-2006
Pub Date : 2006
Teaching Note :Not Available
Organization : General Electric Company Industry : Diversified
Countries : USA

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"I'm a different generation from Jack…..I have a different view of the world."

- Jeffrey Immelt, CEO of General Electric, in 2002.1

"The thing that makes me most proud of Jeff is his visibility in tough times."

- Jack Welch, Former CEO of General Electric, in 2002.2

An Inauspicious Beginning

Jeffrey Immelt (Immelt) became the Chief Executive Officer (CEO) of the General Electric Company (GE) on September 7, 2001, drawing to a close one of the longest3 succession planning programs in corporate America.

Immelt succeeded Jack Welch (Welch), who was generally acknowledged as one of the most successful CEOs in business history for his management of GE in the twenty years he headed the company. On September 11, 2001, just four days after Immelt finally stepped into the job that he had been in training for almost a year, the infamous terrorist attack took place, when hijackers crashed planes into the Pentagon and the twin towers of the World Trade Center.

This event shocked the world and left the US economy - already in bad shape from a recession and the bursting of the dotcom bubble in 2000 - battered.

It was an inauspicious beginning for Immelt. As a huge, diversified company, GE had interests in several sensitive industries like aircraft engines, plastics and insurance, which were sure to suffer the after-effects of September 11. 

The terrorist attacks were a harbinger of bad times to come for GE. As of early 2006, in the four and a half years that he had headed GE, Immelt had had to deal with a series of problems.

By 2002, GE's share price had fallen to levels much below its peak in early 2001, and even by mid 2006, showed no significant improvement (Refer Exhibit I for GE's share price).

Jack Welch and Jeffrey Immelt - Continuity and Change in Strategy - Next Page>>

1]  "The Days of Welch and Roses," BusinessWeek Online, April 29, 2002.

2]  "The Days of Welch and Roses," BusinessWeek Online, April 29, 2002.

3]  Succession planning to identify Welch's successor had started in 1994 and the final decision was announced in November 2000.


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