Training and Development - The GE Way
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Case Details:
Case Code : HROB072
Case Length : 18 Pages
Period : 1981-05
Pub Date : 2005
Teaching Note : Available
Organization : General Electric Company
Industry : Diversified
Countries : USA
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Introduction Contd...
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Analysts acknowledged the fact that GE went far beyond imparting traditional
training. It 'nurtured talent' to bring out the latent potential in its
employees through proper grooming.
The Work-Out Program that GE developed to train its employees created such an
impact that later other companies began to approach GE to try and develop
similar programs for their employees. GE businesses like GE Consumer and
Industrial were certified by professional associations as authorized providers
of education and training for their respective areas of expertise. GE spent
around $1 billion on in-house Training and Development (T&D) every year. In
addition, GE invested over $38 million annually for reimbursement of tuition
fees for employees who enrolled for outside degree programs.
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GE was chosen as the best company for executive development in a survey
conducted by Executive Development Associates8 for the year 2005 (Refer
Exhibit II).
T&D Initiatives at GE
World's First Corporate University
Although on-the-job-training had been used at GE since the 1920s, formal
corporate training took shape during Ralph Cordiner9 (Cordiner)'s tenure as
CEO. On taking up this position in 1950, Cordiner started restructuring the
company, decentralizing it by breaking it up into various departments.
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He felt decentralization would make the company more manageable in
times of rapid growth. As a result of decentralization, GE had more
than 100 divisions where earlier there were just eight major units.
A general manager was appointed for each division, to oversee the
division's overall working.
As a result of the decentralized structure, the company faced
another challenge. The new breed of managers needed to be trained to
enable them to handle their divisions successfully. Therefore,
establishment of a corporate training center for GE executives
became the logical next step. |
Cordiner had envisioned a radically new approach to train
executives for complex management responsibilities. To make this a reality, he
sent a team of executives to look at business schools and universities around
the world. However, the team found that none of these schools would be able to
meet their requirements.
So, finally, Cordiner decided that GE would establish its own facility. The
management development center was set up in the year 1956, at Crotonville10,
in the village of Ossining, New York. It was the world's first corporate
university and a major milestone in the area of T&D for the company...
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