Question 1: GE claims that it has been able to develop management talent as a sustainable source of competitive advantage. How has it managed to do so? Answer:
GE has been able to develop management talent as a sustainable source of competitive advantage. This is because it has always tried to recruit the higher level employees from within the organization rather than hiring them from outside sources. GE used a very through succession management process. This enabled GE to develop the talent of its management. The way they rigorously and constantly trained the next successor always provided them with an upper hand in the market. GE’s management always kept their eyes open for employees who showed a lot of potential an had the ability to be independent and decisive. Its management was a source of competitive advantage because no other organization gave its employees as much authority and variety of jobs to perform as GE. It always tried to keep its employees on their toes. This was done to keep them motivated and to keep them learning. To keep its management as a source of competitive advantage GE always groomed and tested the leading contenders. It has managed to do so by using several GE businesses as proving grounds. The appliances and lighting sector had long been used as a place to develop manager’s operations skills. Transportation System, Energy Systems, Aircraft Engines sector was used to improve the candidates’ skills to manage through capital spending cycles. And their performance at Plastics and Medical Systems could be evaluated for the candidates’ ability to exploit technological growth, acquisition and globalization. So this is how GE managed to develop its management talent as a source of competitive advantage.
Question 2: Is GE’s talent machine perfectly in balance or does the CEO needs to fine tune it? What recommendation would you give him in the 3 questions? Answer: