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ment the shift in strategic focus from the interior to marketing, Immelt realigned the human resource by recruiting marketing leaders from outside to compensate the lack of internal talent and forming the Experienced Commercial Leadership Program to integrate newcomers into GE’s culture and system. In terms of global expansion, which is also one of the Immelt’s strategies, Comte increased the Transportation marketing staff by 18 people. These implementations led to extra investment in terms of increasing personnel and training newcomers.

On the other hand, instead of operating efficiency and cost-cutting, Immelt focused on technology leadership by upgrading R&D facility, upping R&D budget 14% and authorizing two Global Research Centers in Shanghai and Munich. The change caused higher costs and more resources required in terms of R&D.

Rather than focusing on short-term R&D as it had before, GE concentrated mainly on the long term. Furthermore, as one of Immelt’s management styles, spending longer on developing products is prior to acquiring companies for technology, compared to previously consistent growth primarily through acquisitions. Therefore, the result required longer time to reflect on profit.

Immelt slowed the job rotation in order to develop “growth leaders” with deeper understanding in expertise such as market and technological knowledge. Moreover, the evaluation and reward processes which had focused on flawless and short-term execution were adjusted in order to encourage employees to take risks. As a result, although improving professional skills and innovation, these changes led to lower operating efficiency.

危险因素---Risks

In terms of earning per share, the average growth per annum from 1981 to 2000 as Welch was the CEO remained 23%, while only 7% from 2001 to 2009 when Immelt changed the strategic focus. Furthermore, focusing on long-term, more modernized and more limited R&D projects led to larger uncertainty of the business, which might be risky due to its innovation and unknown market acceptability. Therefore, although these changes represent a new era of GE, shareholders might lose their faith of the company.

On the other hand, one of the GE’s major divisions is GE capital services. From late 1980s, GE Capital Services increased largely and by 2000 it accounted for almost half of the total sales of GE Consolidated. However, Immelt put more emphasis back on GE Industrial, and the operating profit fell overwhelmingly from US$6,593 in 2004 to US$2344 in 2009. (GE Annual Report, 2009) There was a symbiotic relation between GE Industrial and GE Capital Service. As Jack Welch was CEO, the main strategy of growing industrial division was acquisition because remaining profit of GE industrial enabled GE to be ranked as industrial company so that GE Capital Services could borrow at cheap rates and lend at higher rates, the fact how GECS increased its revenue. Immelt, nevertheless, abandoned the strategy of acquisition and upgraded the R&D budget in order to enhance GE industrial because he wanted to make GE as a research-based and innovative enterprise. This move led to a collapse of the balance between GE Industrial and GECS and might cause potential risk in GE because GECS accounted for more than 40% sales revenue of total. (Froud, 2005)

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