The CEO of GE's Global Growth Organisation looks back on nearly four decades working in the company, how its focus has changed, and his views on what the world can learn from today's young people
“I was lost” is how John Rice describes the moment in 1978 when he first walked into GE’s New York offices, a young man starting a new job.
Never could he have imagined it would be the beginning of a career spanning almost four decades, during which time he’d witness a dramatic shift in GE that would see the company expand around the globe to almost 180 countries.
Now, 38 years and many positions and postings later, Rice is just over two months away from retiring as vice chairman of GE and president and CEO of the GE Global Growth Organisation (GGO), The division is tasked with driving the company’s localisation strategies and accelerating its growth globally, as well as providing commercial and functional support to GE’s various businesses around the world.
Speaking to Arabian Business during a recent visit to Dubai, Rice recalls that the GE he first entered as a recent graduate was very different than the company he is preparing to depart, both in terms of size and geographic scope.
“When I started, three quarters of our business was in the United States. We were probably active, in any kind of significant way, in 30 countries,” he says. “Today, two thirds of our business is outside the United States – we’ve gone from 75 percent in the US to 33 percent, and we’re in 180 countries,” he adds. “We’re far more global, and we’ve had to create a much more global team. The number of non-US senior leaders has grown significantly, and, for example, the number of non-US employees we have in this region has grown exponentially.”
According to Rice, this change happened gradually, as GE increasingly saw that local talent – and the on-the-ground knowledge that they brought with them – were key to successfully operating in vastly different markets thousands of miles away from GE’s decision-makers in the United States.
“We were going where the business was. It wasn’t like we woke up one day and said, ‘We have to do this’. But we also realised that the world was changing very fast, and we worried that we might not be changing fast enough,” he recalls. “Back in the 70s and 80s, you felt like you could make all the big decisions from the US headquarters and tended to think you might not need partners to solve issues. But we realised that the nature of business had changed, and the company had to change, and now we have partnerships all over the world. We take our strengths, combine them with our partner strengths, and create something that neither of us could do by ourselves.”
In November 2010, GE established the GGO – a move that Rice calls an attempt to make GE’s global mission “a step function change.” The GGO’s mission, in a nutshell, is to drive local investments in talent, manufacturing, innovation and partnerships that are crucial to GE’s substantial business abroad, which in 2016 amounted to $111bn in global orders, with a global backlog of $321bn.
A key part of this mission, Rice notes, is implementing a “One GE” strategy which brings together the company’s diverse verticals, ranging from aviation and renewable energy to oil and gas services and healthcare.
“We’ve come to realise that in many developed countries, our businesses have lots of resources and they get what they need. But you get into many of the developing markets, and our businesses by themselves are relatively small and don’t have enough scale,” Rice says. “We have to add them together and we go to a government and we say, for example, that this is GE in the Emirates, Pakistan or Egypt.
“If you look at our interests in healthcare, in power generation, in basic materials processing, oil and gas, transportation, rail and aviation, they are the basic building blocks of economic growth,” he adds. “Every government is interested in that and every government cares… the idea is that playing together, bringing GE businesses together to meet with a prime minister, president, emir, or ruler of any country, is much more effective than having six individual contact points.”
The ultimate metric for success, Rice notes, is growth, and he points to the GGO’s history in Pakistan as an example of how a transformed GE is making use of local expertise and partners to grow the company’s business. At the time he took over, GE’s business in Pakistan – a country of over 190 million people – was about $100m, a paltry sum compared to many other markets.
“We went out and hired externally, a senior Pakistani leader, who was willing to repatriate to Pakistan to lead GE efforts. He was a much more senior person than you’d normally require for $100m in revenue,” he notes. “We wanted someone who had the ability to make decisions locally and get connected with the right decision-makers in Pakistan, and get the attention of the [various] GE businesses.”
The end result, Rice says proudly, is a GE business in Pakistan which averages about $1bn in orders in any given year, a rate of growth he estimates has been replicated in 20 other markets. “There’s no magic to that. It starts with people. If you don’t have people you trust in these markets and who can influence the people back at headquarters that can manage the resources, then you’re not going to go anywhere.”
Employees: then and now
A fact of professional life in the 21st century is that few – if any – young applicants join companies expecting decades-long careers like that of Rice at GE.
A 2016 study from LinkedIn, for example, revealed that it is now common for millennials to switch jobs four times in the decade after they graduate from university, more than twice the rate of the so-called ‘Gen Xers” who graduated college between 1986 and 1990. In many cases, young people aren’t just “job hopping” from one company to the next: they are switching from one sector to another entirely.
In Rice’s case, he recalls interviews with young GE staff members and prospective employees who have asked him – almost incredulously – why he has remained at GE for so long. One of the keys to remaining committed to a career, he says, is that one feels pushed and challenged. “[At GE] we’re a learning organisation… every step of the way you’ve got to learn and grow, and that never ends. As a vice chairman, I’ve still got to learn and grow. I’ve got to be better tomorrow than I was yesterday. If I’m the same leader next year than I was three years ago, that’s not good enough,” he says. “We give people the opportunity to succeed.”
A second factor, Rice believes, is simply providing an environment in which young employees are surrounded by “great people” who work together as a team with a clear focus. “I would never want to be around a group of people that didn’t want to do things the right way, or that got up in the morning trying to figure out how to take shortcuts,” he says of the principles that have guided him.
Perhaps most importantly, Rice believes that today’s young people are much more likely than his generation to remain in jobs based on whether they think the job “matters”. “They are much more likely to say that they’ll do this job for as long as it’s working for them and they’re passionate about it. If that stops, they’ll go somewhere else.”
These young employees, Rice says, will ultimately help older and higher-level employees become better leaders, provided that they listen and learn.
“In the 70s and 80s, you were a bit of a soldier. You did what the more senior people asked you to do,” he says. “But in today’s world, with this generation, they’re going to expect more. It will ultimately make us all better leaders. It’s what we should have been doing all along.
“As a leader, you should wake up every day thinking about how to motivate and improve and make people better, and ensure that they know that what they do matters,” he adds.
At the end of the day, Rice says, the way a company such as GE works with local partners abroad and with their own young employees is part of the essential necessity of keeping abreast with change.
“It’s an old saying, but the only constant is change. You not only have to believe it, you have to live. The minute you take your eye off the ball, that’s a bad minute.”