How does GE do it? As the recognized leader in corporate finance training, how does Jack Welch’s $112 billion conglomerate manage to funnel all its young talent up through the ranks?
Certainly, Crotonville, the famed General Electric Co. training center in Ossining, New York, is the epicenter of short-term management development seminars for 10,000 of GE’s 340,000 worldwide employees each year.
But there’s a separate channel, starting with the company’s two-year Financial Management Program, for delivering on-the-job and classroom training to 350 college recruits each year. They are the company’s prized “FMPs,” spending much of their time on six-month “sink or swim” assignments at every GE business in 36 countries. They don’t graduate or move on to the next level until they’ve succeeded in a variety of carefully monitored real-world finance assignments, designed to teach them how to be full business partners.
“FMPs are taught early on to be linked with operations, and to think of themselves as chief operating officers,” says GE Medical Systems finance manager Brian Lutes, who teaches a weekly class on strategy as part of the program, and mentors two to three trainees at a time individually. And unlike training programs at many companies, the FMP links to other programs that extend into upper-level finance management: the Corporate Audit Staff and the Experienced Financial Leadership Program. Along the way, FMPs serve as an army of eager young staffers for special duty, say, in helping to evaluate Honeywell’s place in the latest megamerger in the GE universe.
Such on-the-job training is a time-tested approach, used in some form at GE for more than 80 years. But it isn’t easily exported to other companies. “GE has so much scale, it’s really difficult to replicate a program like that,” says Goodyear Tire & Rubber Co. CFO Robert Tieken, a 35-year GE veteran. It’s hard to standardize across Goodyear’s worldwide operations, because there is a universe of “only” about 400 finance staffers there–hardly enough to monitor on-the-job training efforts to the degree necessary. Still, Tieken has used GE principles to enhance cross- training efforts within finance at the tire maker.
Real Risks, Real Opportunities
“The idea that work projects can be a basis for learning is just now really taking hold in executive development programs,” says Joe Raelin, a professor at Boston College who specializes in work-based learning. Such programs often suffer, he says, because companies fear handing critical projects over to trainees. Yet, he says, “one of the tenets of work-based learning is that it be real work: the real risks, the real opportunities.”
GE’s training capabilities helped convince Jamie Vassallo, an international business major at Fairfield University, in Fairfield, Connecticut, which is also home to GE’s headquarters, to join the program 2 years ago, when she was 22. She soon found herself in the broadcast operations division of NBC, working with business managers to deliver financial metrics she’d never heard of in an online “dashboard” format.
“The first couple of days I was pretty overwhelmed,” says Vassallo. “You’re given a lot of responsibility–and a lot of freedom–right off the bat.” Crucial to her learning, she says, “was support from the vice president of finance for the project. We also got coaching on issues like how to deal with people who push back.”