What is lifelike in the C Suite when your first day on the job was 9/10/01? For Jeff Immelt, CEO of General Electric from 2001 to 2017, the following day was a baptism by fire. The terrorist attacks on the Twin Towers and the Pentagon forced him to learn to make decisions quickly and decisively, to revisit those decisions when new information appeared, and to rely on his employees.
9/11 was only the first crisis Immelt experienced on the job; it was followed by the 2008-09 financial crisis, which had an enormous impact on GE Capital. Next came the tsunami-caused Fukushima Daiichi nuclear disaster – four of the 1960s era reactors were made by General Electric. His leadership lessons: Absorb fear, have contingency plans, iterate variations and stay flexible in order to succeed in a crisis. Robust risk management is essential to survive as a large firm. He discusses these strategies in his new book is: Hot Seat: What I Learned Leading a Great American Company.
But in addition to managing through disasters, he advocates being optimists: Leaders must think about the future, make high risk bets and new initiatives to press the company’s existence strengths while thinking about what its clients are going to be buying decades hence.
Despite my giving Immelt every opportunity to throw his predecessor under the bus, he refused to take the bait. When Immelt took over as CEO, General Electric had strong balance sheet but was an industrial giant with a 50 P/E and 40% of revenues coming from finance – it was an accident waiting to happen.
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Be sure to check out our Masters in Business next week with Bill Gurley, the legendary venture capital investor at Benchmark. His investments include GrubHub, Nextdoor, OpenTable, Zillow and of course, Uber. He is a member of the Board of Trustees of the Santa Fe Institute, and is widely considered one of most influential dealmakers in technology. He was named TechCrunch’s VC of the Year in 2016.