How Do You Choose A Prince?

The case of GM's choice of successor has long been a classic.

In 1960, when Jack Welch joined the GE when he was 25 years old, he was just an ordinary engineer. 21 years later, Jack Welch, 46, became the youngest chairman and CEO of Ge.

In 1993, the GE board formally decided that he would retire at the age of 65 in 2001. In the spring of 1994, GE officially launched the selection of successors. And, from beginning to end, I personally lead the work. At this point, the official retirement is still seven years away.

Preliminary planning and preparation

First of all, he has planned four basic guiding principles for this important work:

First, the successor must be the undisputed leader of GE. This is the necessary condition to ensure the stability and inheritance of the company spirit and core values. Second, we must thoroughly eliminate bureaucratic interference in the selection process. As a giant organization, the transfer of the highest authority of GE company will be a great shock process, so we must ensure the fairness and fairness of the procedure. Third, we must ensure that all members of the board of directors are highly concerned about and effective participation in the selection process. Fourth, choose as many young successors as possible to ensure that GE can be led at least in the next 10 years.

Secondly, together with two other vice presidents, he summed up the conditions and elements of an ideal CEO, including honesty, values, experience, vision, leadership qualities, sharpness, fame, fairness, energy, balance and courage.

Then, the above three party group has repeatedly evaluated and evaluated the performance evaluation results of the senior management staff members of the A-level, which is the most outstanding 20% of the performance and quality evaluation. A list of 23 people's Congress has been listed as a candidate for the primary election. This list includes not only 7 top leaders of the group's senior vice presidents, but also the first time in the history of GE company to expand the scope of the selection of top position successors to the head of the Department. The 3 of the final candidates are on the list of 16 people. Among those candidates, the youngest at the age of 36, the oldest 58 years old, obviously the latter must be an emergency candidate.

It is particularly hard to find that the three person group led by the Chinese government has carefully designed a customized personal development plan for each candidate, especially for 16 candidates with potential for development, and detailed plans for their training and job promotion from 1994 to 2000.

Long term training and assessment

In June 1994, the board of directors of GE also decided to hold a board meeting in June and December each year to assess the candidates and follow up their latest progress. To help directors and these candidates have more direct contacts outside the conference room, the company organise them and candidates to play golf or tennis in different places in April and July each year. The company also holds an annual Christmas party for them, and invites their spouses to participate. In each type of activity, he personally assists his assistants in arranging the position of four match matches and the seats at lunch, so as to ensure that directors have at least one opportunity to interact and communicate with different candidates.

In February of each year, I will personally conduct a real-time performance evaluation of all candidates and give incentive cash incentives. In September each year, a comprehensive evaluation is conducted to discuss and decide the award scheme of stock options.

In 1996, he felt that he should create The opportunity for members of the board to conduct more in-depth investigations and assessments of each candidate. So he invited the chairman of the selection committee of the board of directors to take a field trip to every business department. They spend the whole day with leaders and teams of each department, including having dinner together or playing at night. The directors will examine each candidate's leadership style and behavior in depth, and then form a written evaluation report and submit it to him for reference.

In the meantime, the company will constantly transform their jobs according to the training and development plan established for each candidate in advance, so that they can accept various new tests in different industries, regions and environments. By 1998, because of the retirement, leaving office or being eliminated, there were only 8 candidates for the 23 people's Congress. As a strong competitor, they have tried 17 different jobs by June 1998.

Last quenching and choice

By the end of 1998, the board of directors of GE and Jeff Immelt together identified the last three candidates: Jeff Immelt, Bob Nadeli and Jim Mcnani. Because of the tremendous influence of GE and herself, the media's attention to GE's CEO successor is nothing less than the concern of the US presidential campaign. The overwhelming coverage of the media has brought tremendous pressure to the three finalists, but each of them has shown a high level of professionalism from beginning to end, without any unfair competition.

Drawing lessons from what he had learned when he ran for CEO 20 years ago, he deliberately protected three candidates from the influence and interference of the political and bureaucratic behavior of the company headquarters. He insisted that they continue to focus on their jobs in their respective posts and be separated in different areas far away from each other, so as to avoid the embarrassment caused by each other's competitors.

In the spring of 1999 and 2000, the two 11 main departments, including three final candidates, were convened. CEO Holding a private banquet outside the company and discussing the company's future business strategy and the formation of the top leadership team, ask them to propose three candidates respectively to form the best leaders in their minds, and ask them to exchange views with each other frankly. In addition, the fairness and reasonableness of the selection procedures were sought, and their concerns were relieved.

He also asked the three candidates a very important and challenging question: "if you were not elected to CEO, would you leave the company?" two of them answered that they would leave GE without doubt. This reminded him that it was unrealistic to realize that he initially wanted to keep all three of them in GE. This also prompted the decision to make decisions. Once the final result is announced, the two of the defeated will have to leave the GE.

Based on this latest decision, we implemented two targeted measures. First of all, among the 8 candidates who entered the second round, two highly acclaimed candidates were selected and appointed as vice chairmen in advance to form the next term. Board of directors The basic team. And the two vice chairmen who will work with the new CEO are highly recognized by three final candidates. This will ensure that the new CEO will have a good team once it succeeds. Secondly, in April 2000, 7 months before the final announcement of the new CEO in November, the three candidates were asked to discuss and deliberate fully, to present their respective favorite and trusted successors of the Department, and to gradually transfer their business to their successors in the next six months.

In November 24, 2000, the board of directors of GE passed a formal resolution to unanimously elect Jeff Immelt as the new chairman and CEO. On the same night, night flew continuously, and went to three places to personally tell each candidate the final result. After that, he personally came forward and recommended new jobs for the two candidates who had been defeated.

In September 2001, Jeff Immelt took over as chairman and CEO of GE. Jack Welch, the world's first CEO, is officially retired.