"The New York Times business columnist James B. Stewart wrote in 2017, “Hardly anyone considers Mr. Welch a management role model anymore, and the conglomerate model he championed at G.E. — that with strict discipline, you could successfully manage any business as long as your market share was first or second — has been thoroughly discredited, at least in the United States.”
The financial crisis of 2008 delivered a blow to G.E.’s fortunes. In the years before the crisis, the company had built sprawling lending operations that helped drive its growth. But the finance businesses became a crippling liability when, during the crisis, credit markets froze and borrowers struggled to pay back their loans.
G.E., like many large banks, tapped emergency government loans to help it get through the upheaval. In the years following the crisis, G.E. sold off most of its lending businesses, but other problems emerged, some of which were in its large power unit.
G.E.’s stock price now trades roughly 80 percent below the high it hit in 2000. The company has significantly lower revenue than it did that year. Last year, G.E. reported a loss of $5.4 billion."
Short termisms that spreads through the traditional businesses are now causing them to die off.
Whether it's rank and yank, diversification into the hottest financial markets, throwing away manufacturing because those weren't making a lot of money, killing of R&D because they are a cost center. You'll see so many "capable" CEOs who could handle the day to day gracefully but manage like this, and lead the companies to their doom.
There are a number of CEOs--Mark Hurd at HP is another--who seemed for a time to really be delivering, especially prior to predecessors. But it turned out to be mostly about selling off the seed corn and otherwise doing financial engineering than streamlining and preparing the business for the long haul.
"The New York Times business columnist James B. Stewart wrote in 2017, “Hardly anyone considers Mr. Welch a management role model anymore, and the conglomerate model he championed at G.E. — that with strict discipline, you could successfully manage any business as long as your market share was first or second — has been thoroughly discredited, at least in the United States.”
The financial crisis of 2008 delivered a blow to G.E.’s fortunes. In the years before the crisis, the company had built sprawling lending operations that helped drive its growth. But the finance businesses became a crippling liability when, during the crisis, credit markets froze and borrowers struggled to pay back their loans.
G.E., like many large banks, tapped emergency government loans to help it get through the upheaval. In the years following the crisis, G.E. sold off most of its lending businesses, but other problems emerged, some of which were in its large power unit.
G.E.’s stock price now trades roughly 80 percent below the high it hit in 2000. The company has significantly lower revenue than it did that year. Last year, G.E. reported a loss of $5.4 billion."
See https://www.nytimes.com/2020/03/02/business/jack-welch-died....