GE Shifts Away from Six Sigma and Toward Innovation

(p. B1) One of the biggest engineering projects under way at General Electric Co. these days isn’t a turbine or locomotive. It is reinventing the way the company’s employees are assessed, reviewed and even paid.
For decades, an ideal GE worker was one adept at squeezing out product defects and almost allergic to admitting uncertainty.
Now, as the 124-year-old company refocuses itself on industrial businesses, executives say top performers are those willing to take risks, test new ideas with customers and even make mistakes.
Leaders say GE’s multiyear effort to remake itself into a leaner, innovation-driven company requires a nimble workforce that can develop products faster and more cheaply. The shift is significant for GE, whose corporate ethos had long been embodied by Six Sigma, a manufacturing system designed to eliminate error, enshrining certainty and consistency.
. . .
(p. B6) The new style of measuring employees has roots in FastWorks, a companywide initiative intended to hasten product development and ensure that customers want new products before GE spends millions building them. It is based on Lean Startup, a management system popularized by Eric Ries, a 37-year-old author and consultant GE brought in with the blessing of Chief Executive Jeff Immelt to help employees get comfortable with trial, error and experimentation.

For the full story, see:
RACHEL EMMA SILVERMAN. “GE Tries to Reinvent the Employee Review, Encouraging Risks.” The Wall Street Journal (Weds., June 8, 2016): B1 & B6.
(Note: ellipsis added.)
(Note: the online version of the story has the title “GE Re-Engineers Performance Reviews, Pay Practices.”)

Ries’s Lean Startup management system is advocated in his book:
Ries, Eric. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. New York: Crown Business, 2011.

Leave a Reply

Your email address will not be published.