Leadership development for small organizations: How can a small to mid-size organization create a leadership development program? The author taps GE's chief learning officer to help answer that question - Lead On! - Steve Kerr, General Electric Co

T+D, March, 2002 by Marshall Tarley

Nine months into a pilot program on leadership development, I'm meeting with my CEO. He's a brilliant guy, who generates ideas as fast as one plays pinball. "GE," he intones. "I want you to find our what GE does to develop leaders."

Naturally, I want to please my CEO, so I dust off my copy of Jack Welch and the GE Way (and some other GE texts) and search through the pages on leadership. Two names keep coming up: Crotonville, GE's corporate university, and Steve Kerr, GE's chief learning officer. Then I go to GE's Website, which is quite impressive. You can order billions of dollars worth of airline engines, make investments through GE Capital, or do like I do: read about GE'S executives, their renowned values, and their leadership.

The site says, "Please email us with any questions." So, I do and ask for more information on GE'S leadership programs. I receive a page the next day, to which I respond, "Not enough. I want more." Surprise! I'm sent Kerr's phone number. Surprise again! I'm put through, and Kerr answers his own phone.

"Hi, Steve," I say. "I'm building a leadership development program for a medium-size company, and I'd like to meet with you to find out what GE does to produce so many great leaders." (You can't be more straightforward than that.)

"I'm sorry," he says, "I get these requests all the time, but we only do that kind of thing for our own people and our key customers. Are you a key customer of ours?"

"No, we're not," I say. "But we do play a significant role in protecting intellectual property rights. GE must own an enormous number of patents, trademarks, and other intellectual property, so we do serve GE'S interests."

Long pause on the other end. I've learned that when someone pauses, you should just wait silently. I wait. Finally, Kerr says, "OK."

Two weeks later on a snowy February morning, I'm heading to the famed GE Crotonville campus. It's a scenic view along the Taconic Parkway, just north of New York City. I turn off at the sign for Ossining, and enter Crotonville--a series of buildings and well-manicured rolling greens along the Hudson River. I follow the signs to the main building, and park. As I walk towards the entrance, I see a tall, dark-haired man with a thick mustache, briefcase in hand, also walking to the entrance. Instinctively, I know it's Steve Kerr, who went from dean of USC's business school to chief learning officer at GE.

We exchange introductions, shake hands, and enter a huge carpeted lobby with giant picture windows overlooking the Hudson. A reception area is at one end, and a station of coffee, espresso, pastries, and such is at the other. Kerr invites me to help myself and then points across the room. "That'S the Pit."

The Pit is where Jack Welch and other top brass are notorious for inviting GE's emerging leaders from middle and upper management to participate in in-your-face discussions. I'm shown the state-of-the-art, theater-style conference rooms and told about the catering, residence building, 24/7 recreation building, and fully stocked kitchenettes, where someone might fix him- or herself a midnight snack. Kerr explains that GE employees and key customers fly in from all over the world to attend training, which typically runs for two to three weeks. It's all terrific, but I came here to get an inkling of how GE turns out so many great business leaders. In particular, I want to learn whether GE's approach can be applied in smaller organizations.

Kerr and I go to his office, where we spend an hour. Here's what I learned.

The GE way Management counts. If you want to be a leader at GE or in any business, you'd better be a topnotch manager. Management should be injected into people's DNA by the way they are managed. Everyone at GE is imbued with the firm's famous values, honed through years of input from GE managers. Everything that's done at GE is measured against those values, including performance appraisals, feedback, and goals. Goals are clear and tangible--for example, "Reduce travel and lodging expenses by 20 percent in 2002."

Success is the best predictor of success. I ask Kerr what key competencies GE looks for when selecting leaders. "We don't do it that way," he answers. "The only indicator we look for is successful performance. Grades are the best predictor of grades."

Get a popcorn stand to run. "When people are successful," says Kerr, "we give them greater leadership roles and, at some point, a popcorn stand to run."

Seeing my confused look, Kerr adds: "On average, we absorb five new businesses every two weeks.

Some aren't in the public eye and have revenues that aren't much more than a rounding error on GE's balance sheet. We have little downside here. We take emerging talent and give them one of those companies to run--their own popcorn stand."

Rotate. GE supports its managers with leadership and management training. If the managers are successful, they're given increasingly larger businesses to run and rotated into different businesses. Says Kerr, "If you can lead and manage a plastics business, you should be able to run an aerospace or a financial services business. So by the time you're ready for a top job, you've proven yourself in many different businesses, many different situations. You're tested and ready, and we're certain you're going to succeed."