Developing and changing organizations

The General Electric Company is a global conglomerate that manufactures industrial products such as oil and gas production machinery, medical imaging equipment, aviation engines, and other equipment for the production of energy. The business is divided into a number of categories, such as renewable energy, aviation, power, healthcare, transportation, capital, and energy connections and lights. To enter the next industrial era, the G.E Company’s objective is to “construct, move, power, and cure the planet.”“ ”The company’s goal is to dominate the markets it serves through its core activities. The G.E. Company has established a plan to carry out its goal and vision which is directed at improving its portfolio from the current broad conglomerate to an efficient and more focused entity. It also aims at becoming a leader in the business it operates globally. The company has also set to do away with underperforming and non-strategic businesses, whose market share has been dormant (Isaac, 2014). The success of G.E Company is attributed to its culture of engaging its leaders which increased the connectivity of the entity to the daily needs of the customers and employees. The company organization structure encompasses various divisions based on the segmentation, which is highly decentralized. Each division is headed by its senior management team composed of a president, vice-president, and C.E.O. G.E culture of command and control was draining away the entity legacy of attracting and retaining performance.

The Problem that Facilitated Organization Change

G.E Company has in previous decades been conducting annual reviews for their employees with an aim to improve performance. It concentrated on the process as opposed to outcome. The rigid annual review process was known as “Vitality curve” which was also called “rank and yark.” It involved reviewing of employees’ performance based on several factors in which they were judged and compared against those of peers; those who scored 10 percent and below were regarded as underperformers and were fired. The formal, forced ranking performance management system had built it a legacy worldwide. The system boiled up and demotivated employees which in turn resulted in bad performance. G.E has joined other companies such as Microsoft, Adobe, and Accenture which has shifted from the annual review of performance. G.E performance management system has been emulated by enterprises which are known to abandon the system after the company got rid it, as it indicatedend of practice. G.E head of human resources described the annual performance as a ritual as it failed to move the company upwards and forward as expected (Isaac, 2014). The top employees were paid huge salaries whereas registered the worst performance whereas people at the workers at the bottom had much better productivity but paid considerable low salaries as compared to their counterparts in high positions.

The annual performance review resulted in great swatches of G.E workforce which saw the company fail to achieve its mission and objective of attracting and retaining talents. It also saw the company stagnant in performance instead of improving performance through increased staff productivity. In its restructuring G.E company has also sold off billion-dollar pieces of the financing business to concentrate on thriving high-tech and industrial businesses. The company experienced high staff turnover which led to wastage of the entity resources in recruiting and training new employees. The various challenges imposed by the annual performance review saw the management shift to a millennium style that involved working and immediate feedback, which is faster, frequent and mobile enabled. The annual performance review process was regarded as an inadequate means of managing people and boosting performance as it laid great focus on the process rather than the outcome. The management realized that the annual performance system was an element of bureaucracy as opposed to an agent of change.

The head of HR department defended some notion of performance review as he argued that, performance appraisal of the employee is crucial and should be carried on a regular basis to help them know where they are on a regular communication and feedback. It is effective as it will help employees develop or work on current strategies to achieve high performance. The management realized that the current management by Welch was outdated, unfriendly, alienated employees and was not open and welcoming. The management saw the need to implement a performance management system that was friendlier and close to the needs of the employees to motivate them to work towards achieving better performance. G.E management saw the need to have a transition from management by the process, and rigid bell curve whereby employees were motivated by competition, to a more flexible mobile enabled regime of workers. The company incurred losses and failed to sustain its core values by using the control and command form of management, but the management considered a change to a connection, developing and inspirational system of managing workers and boosting performance.

G.E has now adopted a management app known as “PD@GE, whose purpose is to improve performance. The new app has facilitated setting of new term-goals/priorities for the employees and frequent discussions on ”touch points“ between managers and workers. The discussion entails on the individual progress on the goals and commitment of the employees towards what is discussed (Isaac, 2014). ”Insights“ features in the app enable employees to give or request feedback anytime. The new management app has boosted company performance as it encourages employees to commit to changing something instead of continuing doing the same thing the same way.

General Electric Company Culture and Core Values

A strategic shift is always accompanied by a cultural shift for the change to be achieved. G.E Company has in the last decades utilized its culture of the six Sigma by concentrating on controlling costs, delivering quality, and infrastructure and behavioral execution (ranking of employees. The company culture saw leaders concentrate and demonstrate the 4Es which are energy, edge, energize, and execution. The company has now moved from ”command and control“ culture to a more horizontal agile culture of ”connect and inspire.“ G.E has fostered its employees in believing the in the following beliefs; the success of the organization is highly dependent on the customers, and employees should stay lean to learn fast. Also, they must focus on learning and achieve, empower and inspire each other, and always delivering results regardless of the situation (Kabanoff, Waldersee, & Cohen, 2014).

In making an organization change, the entity needs to focus on three core values, the culture, core values, stakeholder focus and entrepreneurial focus. G.E leadership is defined by its culture of connecting and inspiring. Core values are agreed upon ways of doing things in the organization. An entity with well-established core values is united, is efficient in solving problems and has laid down a framework of carrying out its operations (Erskine, 2013). G.E company has well-defined employees core values which are the basis of employees objectives; they include; creative thinker, courage, external focus, expertise, imagination, and expertise. A management change based on linking employees’ goals and company goals achieves profitable growth and helps build motivated and healthier employees. Aligning workplace culture with the entity employees creates a sense of belonging which motivates workers to deliver better results (Donald, 2016). G.E management decision was facilitated by the need to align the new culture with organization mission by redefining work, work process and outcome.

The Role Played by G.E Culture and Organizational Values

Organization culture is a barrier to change if not given enough attention. The new culture of ”connect and inspire“ demanded a change in performance management system from the annual performance review. The new culture is more decentralized and advocates for delegation of power to where the action is. Therefore, this has lead G.E Company to adopt a friendlier and effective performance management system that engaged and motivated employees while boosting performance. The shift in culture has come along with a change in a new strategy which involves simplification of the G.E operating rhythm. The new strategy consists of increased customer intensity, a complete reimagination of IT and adoption of digital applications such as the new app for employee management.

To foster the new culture of simplicity, quality, speed and customer focus, G.E implemented a change process of undertaking performance appraisal using a more-real approach. The strategic change in performance management system was stimulated by the need to align G.E core values of motivating and satisfying employees to entity business goals. Organization members embrace change with minimal resistance when corporate culture is aligned with the organization goals and missions (Kabanoff, Waldersee, & Cohen, 2014). The core values advocates for togetherness and unity in delivering results. It therefore, drove the management into adopting a ”WE“ slogan from the ”I“ by inspiring people. G.E management also worked towards implementing the performance management change to strengthen and sustain its corporate culture, by advancing the quality of life of stakeholders namely its employees. The annual performance review always resulted in the firing of staffs which was against the company core values of promoting the well-being of employees.

G.E culture of connecting and inspiring contributed to the change by fostering upgrade of talent management, succession planning and continuous performance appraisal, discussions and feedback. In achieving organization mission of making money, the entity must also focus on the gift of human resources who links entity mission and culture. There is need to redefine leadership by influencing people to own the right and the responsibility to lead others without being pushed, as it increases creativity, profit, energy, and clarity (Erskine, 2013). G.E has redefined its leadership through the implementation of performance management app to get close to the people and grant them the right to work with passion. G.E is committed to leading with humanity to respond to the current demand for workers in this millennium era. The numerous changes in technology, products, and markets have facilitated the need for an organization to undertake change. Management must undertake cultural analysis when planning and implementing the change to attract attention and commitment of members in reducing resistance to change (Donald, 2016). Cultural analysis is also significant in establishing the cause of the problem facing the organization which hinders achievement of high performance.

References

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Erskine, P. (2013). Organizational Change Models. In ITIL and Organizational Change (pp. 30-

71). Ely, Cambridgeshire, United Kingdom: IT Governance Publishing.

Isaac P. (2014). A Secret Ingredient for Success at General Electric: General Electric’s most valuable

asset is too often ignored by the average investor. UNICEF

Kabanoff, B., Waldersee, R., & Cohen, M. (2014). Espoused Values and Organizational Change

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