“We are not a McKinsey,” she says, “where an MBA is pervasive through the echelons of management. Many of our senior execs don’t have MBAs. GE is a culture of delivering for our customers and that doesn’t necessarily have to be attributed to an MBA.” The American multinational conglomerates’ soaring businesses tell its own story. Industrial segment profits rose 12% to $3.3 billion in the first quarter of this year. From Capital to Aviation to Oil & Gas, GE’s markets are thriving. It has been a momentous week for the corporation. Share price has edged upwards as news of their bid for French engineering group Alstom emerged.
Expansion is not a new theme for GE. The firm works in more than 160 countries, with some 300,000 employees. It has cemented its global reputation with a big push into emerging economies. The company has four different businesses within sub-Saharan Africa, and employs 107,000 people across the entire continent.
It is not surprising that GE is one of the biggest MBA employers. But obtaining an MBA will not make you a leader. “Getting an MBA is a pre-screen,” says Heather, who runs their Sales and Marketing Leadership Programs. She continues: “I think the MBA has become the college degree of 10 or 15 years ago. But it’s a total package [that we look for].” In other words, GE is selective. And getting onto a leadership program is just the first step in MBA’s potential corporate development. GE’s Experienced Commercial Leadership Program (ECLP) snaps up about 100 candidates each year and most of them are MBA graduates. Clearly, the corporation sees the degree as an ideal mould for potential leaders. “That’s the dialogue that I’ve had with very senior executive sponsors of the program, as well as faculty at our target MBA schools,” says Heather.
At the same time, business schools have been ramping-up their leadership development efforts. It is mostly in response to applicant and corporate demand. Research released this month from GMAC put leadership as the number-one learning objective of MBA applicants. Finance and marketing were banished to the side-lines. Meanwhile, corporate recruiter surveys have pointed to leadership as the most desirable trait in new hires. Henley Business School polled 350 executives, the majority at director or CEO level. More than 70% cited leadership as their company's next major challenge. About 80% of those executives plan to maintain or expand their leadership and development budgets. “The message is: ‘investment, investment, investment’ – in leadership development [and] in team development,” says Professor Bernd Vogel, Director of the Henley Centre for Engaging Leadership.
Nick Holley, co-director of the Henley Centre for HR Excellence, agrees: “Organisations are recognising that the development of leadership capabilities… is essential to produce the best return in organisational performance for shareholder investment.” It is a view seemingly shared by GE. The corporation invests about $1 billion each year on training and education programs for its employees globally. “It [an MBA] teaches you how to learn. And it also shows an innate work ethic that is essential to getting an MBA,” says Heather. “It demonstrates somebody’s capacity to grow as an individual and it’s a differentiator in a very competitive landscape.”
GE’s success, making it one of the world’s largest conglomerates, has allowed it to continue growing its base while churning out the next generation of business leaders. They shoot for 100% placement on their ECLP program. Many MBAs then stay on at GE for their entire professional careers. Yet there is not a place on the boardroom table for every impressive MBA graduate. Heather argues that it is the soft skills that now set leaders apart. The landscape now has changed as business schools and Executive MBA programs have become more popular. Yet the need for talented hires has never been more crucial for business success. In response, business schools have opened up more leadership tracks. MBA students too are recognising the need to develop their soft skills – outside of lecture theatres.
“To grow in our organization you have to be known for delivering on your goals,” says Heather. “You have to be someone people want to be around and work for, without necessarily having authority.” She continues: “A successful GE leader is grounded, well rounded and very humble. I call it the natural rockstar.” When it comes to sales and marketing roles, which many GE MBAs go into, you must put the customer before the company. It’s a given that you’re hitting your targets, she says. “From a leadership perspective you view it from customers’ eyes, not internal eyes. Being a champion of the customer is something that folk often bring to the table.”
Heather’s background provides some scope. She has been through GE’s leadership rotation herself. She graduated from Virginia Commonwealth University’s MBA program in 2002 and has since climbed the corporate ladder. After completing the ECLP she worked as a marketing manager for six years, before moving onto GE Capital as a marketing leader. She became Director of Commercial Leadership Development Programs in July last year. Heather believes the program gives MBAs opportunities – but it’s up to individuals to take them. “The culture is: you’ve got to earn it,” she says. “If you don’t have the muscles to take advantage of it [the ECLP program], it isn’t going to provide leadership opportunities outside of what you’re eligible for.”
A diversity of perspectives is another big driver behind GE’s leadership development. Their programs strive to bring fresh and new ideas to the commercial talent pipeline, Heather says. So different leadership styles are valued. “There isn’t a quintessential GE leader,” she says. “Diversity is what makes us so successful across multiple industries.” Heather points to GE’s last two CEOs as a case in point. “They couldn’t be more different; Jack Welch was an operational leader who was very much about efficiency, whereas Jeff Immelt [current CEO] is a sales guy who is about customers and innovation and globalization,” she says. “That is a first-hand example of how different leadership styles can be effective and successful in GE.” There is no singular mould for leadership. MBA programs give potential leaders a base – but you must find other ways to shine.
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