View from the corporate netherworld

Book review of Hot Seat: Hard-won Lessons in Challenging Time

In September 2001, Jeff Immelt stepped into the role of CEO of General Electric, replacing Jack Welch who is generally considered the best CEO in the corporation’s history.  If that task wasn’t daunting enough then soon after, GE would be plunged into an unprecedented crisis with the terrorist attacks of 9/11 on American soil. Two of GE’s employees would lose their lives and GE’s insurance and aircraft engines business would be directly impacted.  By the end of his first week as CEO, GE’s shares had dropped 20 per cent, wiping out $80 billion in market cap.  Around this time, Mr Immelt sought advice from a GE board member and ended up admitting that he felt like he wanted to vomit all the time.

This revealing anecdote is one of many candidly captured in Jeff’s Immelt memoir Hot Seat, co-authored with Amy Wallace, following interviews with more than 70 people, both inside and outside GE.  Mr Immelt’s father worked for GE, and after completing his education at Dartmouth and Harvard Business School, he, too, joined the conglomerate and worked his way through Plastics, Appliances, and Healthcare before being tapped for the top job.  He was at the helm of GE for 16 years and along the way, he got himself a tattoo of the company logo on his left hip to prove that he was the “ultimate grinder…a true believer”.

But his legacy is controversial.  Under his watch, GE underperformed the stock market and when the news of his departure was announced on June 12, 2017, the investors bid up the company share price 4 per cent. His successor, John Flannery, was removed a little more than a year and the iconic company that prided itself on nurturing top leadership talent had to reach out to an outsider Larry Culp to steady the ship.  Mr Immelt himself concedes that “my tenure had ended badly…Maybe it would be better not to write a book at all”.  But teaching a class at Stanford Business School made him realise that there were lessons from his experiences and he decided to approach the book as an interrogation of himself and his tenure.

Hot Seat: Hard-won Lessons in Challenging Time

Author: Jeff Immelt

Publisher:  Hodder & Stoughton

Pages: 352; Price: Rs 699

Indeed, the book is an illuminating chronicle of how Mr Immelt weathers multiple crises and encounters an interesting cast of characters, including heads of states, in a game of debatable outcomes and high stakes consequences. In some ways, it sent me back to another excellent memoir — The Ride of a Lifetime by Robert Iger, the former CEO of The Walt Disney Company.  But while Mr Iger’s book is a story of triumph and success (his big moves largely played out favourably for the Disney company), Jeff’s account is more reflective; he owns up to some of his mistakes, provides context to his decisions and occasionally assigns blame to others.  The result is tension, drama and interpersonal conflicts.  The account of the Alstom deal and his subsequent dissatisfaction with the leadership of GE Power is particularly riveting.

The book also offers glimpses of Mr Immelt’s relationship with his famous predecessor Jack Welch.  He admits that “to walk into a room with Jack was to feel like a flea on the back of an elephant.”  But he was really bruised when  Welch went on CNBC and threatened to kill him if he missed the earnings target again.  In a well-told scene in the book, Mr Immelt confronts Welch for his lack of support and states: “Following you has been no fun.  I’ve kept my mouth shut about the problems you left me.”  His relationship with Welch ended when he felt the latter was out to promote his own personal brand.

Written in an engaging manner, the book goes way beyond the baseline expectation of corporate literature as it opts for candour over diplomacy and offers solid insights and wisdom over anodyne dictums and Power Point banalities. While narrating his version of events at GE,  Mr Immelt distills lessons in crisis management from a variety of challenges he has faced as a leader and the reader can look forward to turning the pages to discover some real gems.  Sample this: “If all you want to do is cover your ass, you shouldn’t sign up to be CEO”. 

Or: “Making imperfect decisions in the pursuit of progress always beats the alternative: letting the fear of blame stop you cold.”  The book, thus, presents itself as a valuable read to students and executives wanting to navigate the netherworld of today’s business.