- GE has been able to produce enough quality top candidates for top management positions by motivating its employees by the results and the goal setting and growth opportunities presented to employees, thereby creating an optimal work environment for GE employees (GE, 2013). GE has one of the most sophisticated human resource processes in the world (Bartlett & McLean, 2005). The firm instituted a well-defined succession management process characterized their meritocracy-based culture. This process allowed sound performing managers to start at lower ranks, which served as training ground by working in various sectors while following specific performance goals. Additionally, in the process, junior managers received support from senior managers who conducted the evaluation process based on their strength, weaknesses, and characteristics. No any other organization could implement and maintain this performance oriented culture and showed GE’s dedication towards their human capital (Bartlett & McLean, 2005).
- The firm only rewards only top performers through promotion and additional training to enhance their skills and motivate them. Additionally, GE applies two by two matrix by not only evaluating performance of managers based objectives, but also on the firms value. GE also has training programs that enable to recruit mangers internally. By being a result-oriented firm, the firm allowed its employees to learn how to perform their duties and achieve both personal and organizational goals. Decentralization enabled the firm to delegate duties and involve managers deep into the function of the organization. Many long-serving employees at GE viewed the firm’s vitality curve ratings as part of the firm’s meritocracy-based culture (Bartlett & McLean, 2005). It allowed GE seamlessly integrate feedback, training, coaching, and clear performance goals into a single process.
GE’s compensation policy prescribed tight ranges on salary and nominal differentiation on cash bonuses as incentive payments. These were leveraged by Welch to reward only top performers. Continuous education, team meeting, and performance rankings and reviews encouraged employee involvement with their jobs. GE also continued developing mangers, which helped drive the superior performance of the company. The company also integrated its human resource system with other aspects of the operating system thereby improving productivity and harmony.
Bartlett, C. A. & McLean, A. N. (2005). GE's Talent Machine: The making of a CEO. Boston: Harvard Business School Publishing.
GE. (2012). General Electric. Retrieved from http://www.ge.com/