Week 2- Statement of Core Problem

 Reg Jones Welch had raised the bars of General Electrical so high such that GE shareholders wondered whether his forerunners, will be in a position to sustain the company leadership, change, and growth. More specific the worry was the generation of shareholder returns which amounted to 23% during the Welch era (Bartlett & Wozny, 2005). The core problem presented in the case study of General Electrical involved getting a leader who would sustain the pace of change and growth experienced under Welch leadership. Poor business management results in business failure. While good business management practices result in business success. In the case of General Electric, Welch addressed the issue of business management until it reached a point where the firm became a world example of perfect leadership and management. Welch addressed management problem by coming up with initiatives such as company restructuring by changing the business standard to #1 or #2 that is fix, sell, or close, best practices and work-out initiative dabbed as software initiative and boundary-less behavior among others (Bartlett & Wozny, 2005).

The old structure and culture of the firm were was so ingrained that it took Welch two decade to rectify the problem and given another decade he could have done extra work on the management. The problem can be termed severe since there was still room for greater improvements. Poor business structure and culture have their implications that need rectifying in order to achieve proper employee management, realization of desired profits, reducing internal conflict in a firm, improved competitive advantage and enhanced expansion ability.

The problem of poor structuring and organizational culture is mostly felt by the leadership and key stakeholders of the company. In our case leadership may encounter conflicts as different manager try to pursue different courses to achieve success. In a well-managed company, leaders speak a common language and conflicts are rarely witnessed. Key stakeholders are affected in the sense that the business does not realize its goals, therefore, realize low profits or no profits and in other cases incur losses.

 

 

References

Bartlett, C. A., & Wozny, M. (2005). GE's two-decade transformation: Jack Welch's leadership. European Case Clearing House.