An Analysis of the Organisational Behaviour of GEC Marconi
2The Hirst Era5
3The Weinstock Years8
4The Simpson Period10
This paper is concerned with the organisational behaviour of the General Electric Company Marconi corporation (GEC) and follows on from the analysis already performed by the Grasmoor syndicate team and presented on 5th December 2006.
Formed in London in 1886 by two German immigrants, Gustav Binswanger (GB) and Hugo Hirst (HH), GEC started life as a manufacturing operation taking advantage of the rapidly developing electrical industry by making small electrical items, such as light switches and bulbs.
After floating on the London Stock Exchange in 1900 the company continued to grow rapidly and in 1910 HH was appointed Managing Director. The company continued to expand at home and abroad with branches being established in Japan, South Africa, India as well as Europe.
During the First World War GEC began making military equipment, such as signalling lamps and radios, and in 1918 GEC took over Fraser and Chalmers (FC). The takeover of FC moved GEC into heavy electrical engineering and they were instrumental in the formation of the UK's national grid distribution system.
During the Second World War GEC continued to expand its military division and was a major supplier of electrical equipment to the armed services. They were heavily involved in the development of cutting edge technology, such as the cavity magnetron for radar and communications equipment.
HH continued to be Managing Director and Chairman of GEC until his death in 1943. Following his death, his son in law, Leslie Gamage (LG) became joint managing director along with Harry Railing (HR).
Under the leadership of LG and HR, and thanks to external competition GEC began to slow down and profits started to decrease for the first time. However, in 1963 GEC acquired Radio and Allied Industries (RAI) and along with Arnold Weinstock (AW).
AW became CEO in 1963 and immediately embarked on a program of internal rationalisation which rejuvenated GEC. In 1967 GEC acquired Associated Electrical Industries (AEI), one of two major competitors. In 1968 GEC merged with the remaining competitor, English Electric (EE) and became the only large electrical company in the UK.
GEC continued to expand under AW and in 1974 acquired Yarrow shipbuilders (YS) and Avery in 1979, amongst others. By 1979 GEC was the largest private employer in the UK.
In the 80s and 90s GEC expanded its defence arm into modern technology and through joint ventures and mergers became a major defence contractor to the UK government.
AW retired in 1996 and was succeeded by George Simpson (GS). GS focused the company on the high growth, high technology telecommunications sector by de-merging many divisions including the sale of Marconi Electronic Systems to British Aerospace.
Unfortunately for GS the dot com bubble was about to burst and GEC was hit very hard. GS resigned in 2003 and in 2006 75% of GEC was acquired by Ericsson. (Marconi website, 2006)
The Grasmoor presentation on this subject focused
on the culture and structure of GEC during three key periods, the Hirst era, The Weinstock years and the Simpson period. This paper shall follow the same structure and we shall begin each section with a recap of the Grasmoor analysis whilst expanding on some areas that were only briefly covered. We shall then consider how effective that analysis...