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Monday, May 10, 2010

Great Leadership

‘Great leadership, that is, to me where it is. It’s in overcoming disappointments because nothing ever goes smoothly, nothing ever goes one hundred percent the way you think it’s going to go. How do you respond when it doesn’t quite workout that’s the true test of a leader.’
Tony Dungy, Super Bowl winning NFL coach


To invent future leaders, General Electric redefines 'tough love'

Ed Ng is president and CEO of GE Capital South East Asia, the company’s financing unit. Recently he shared insights on GE’s human capital development culture.

Even though there have been changes in the company’s culture, certain aspects, like the emphasis on values of integrity, remains. While things like 'values' cannot be quantified and do not show up on the balance sheet, GE regards them just as highly. 

According to Ng, "if you have a person who delivers strong financial results but lacks the values, the integrity, it’s a very easy decision – we remove that person as easily as one who has low performance and is low on values".

GE is known for the way it turns leadership development and talent management into a science more than an art. For example, in each and every position, there has to be an identified successor, from within or external sources. To adhere to this practice, the hunt on-going to uncover “talent behaviours” is a continuous, ongoing process.

Integral to this talent management system is GE’s company-wide reward and recognition programme, which allows any manager to go online and recognise employees by way of cash or non-cash rewards. Every employee uses the Employee Management System annually to assess themselves as his colleagues and managers do the same. 

What makes this system somewhat different from any other staff appraisal systems is that it requires a detailed list of accomplishments and scores the employee against specific GE growth values (read: the leadership potential scale), including the employee’s external focus. In other words, employees are rated on their ability to look at the business and his function from the customer standpoint; the ability to see clear solutions amid complex problems; imagination for out-of-the-box solutions; inclusiveness and teamwork; and finally, technical competence in the position. These are traits expected of every leader in GE.

Word of caution: some boxes in this score sheet carry much more weight than others. For one, if the box next to 'integrity' is left unchecked, this will have the effect of cancelling out all other parameters, however positive. “The difference between GE and other companies is that we believe if you don’t have a core set of values that anchor your belief of what is ethical behaviour, you’re going to run into problems. Without unyielding integrity, you’re basically an empty shell,” said Ng.

To tighten the requirements even further, integrity is only deemed honest when seen through the eyes of others. “Very rarely will you find a particular employee who is mentioned as weak, or as a developmental leader in that he falls behind in an area of performance or measured value, and other employees don’t agree; or a manager thinks that an employee is a strong role model but others don’t agree. It’s an embracing process to prove you will make things happen and always, with unyielding integrity. There are second chances given for some weaknesses except for integrity or compliance failures,” said Ng.

Clearly, while GE’s leaders will change, along with their style, for the company, the on-going task of grooming future leaders never stops. Paraphrasing Edison, Ng said: ““We are constantly seeking new ways to develop leaders. If the world now needs a new kind of leader, GE will invent it.”