Cultural Assessment of General Electric
Learning Team A

Human Relations and Organizational Behavior
March 14, 2005

Cultural Assessment of General Electric The corporate culture of General Electric (GE) is a composite of its people, leadership, organization, structure, and processes from past to present. This paper will provide an assessment of the corporate culture of GE, and provide an insight into the dynamics, which have made it one of the world’s premier companies. The aspects of General Electric’s culture begin with its leadership, and progress through its management, workforce, policies, and objectives. GE leadership provides corporate direction with a formalized set of values and …show more content…

These two needs appear to be the primary catalyst for GE employees. The privilege to think outside the box, and to allow individuals to grow, brings major rewards within the GE culture. Jack Welch used a very serious carrot and stick concept to motivate his employees during his reign at General Electric. Every employee earns a rating number and the least effective 10% of the employees are relieved of their employment with the organization. The top 30%, of the rated employees, are given stock options, which is a tremendous incentive for employee excellence. Another key perk is the monetary reward of being ranked in the top 30%. Employees who achieve this rank are given substantial raises. According to Welch “…there’s nothing I like more than giving big raises” (Hymowitz, 1999). One of the legends that General Electric is known for is called “number one or number two.” “Where we are not number one or number two,” Welch said in an early speech as CEO, “we have got to ask that very tough Peter Drucker question: ‘if you weren’t already in this business, would you enter it today?’ and if the answer is no, face that difficult second question: ‘What are you going do about it?’” (excerpted from a book review of At Any Cost in Multinational Monitor (1999)) This policy caused the demise of several divisions. The most widely known was the consumer appliances