A review by shrey_sinh
Lights Out: Pride, Delusion, and the Fall of General Electric by Ted Mann, Thomas Gryta
3.0
Lights Out: Pride, Delusion, and the Fall of General Electric
General Electric, the “Edison company” which once used to be the USA’s industrial poster boy, got reduced to almost irrelevance within a period of 2 CEOs. Though rags-to-riches stories make us optimistic, we must pay heed to riches-to-rags stories once in a while to be rationally optimistic.
Ted Mann and Thomas Gryta make serious attempts to unearth the pride and delusion of the company, especially that of its senior management, that led to this unexpected fall. The authors tangibly point out how complacency, delusion, and big ego may lead to the collapse of an entire empire. Usually, compliments are endowed upon Jack Welch and Jeff Immelt is portrayed as the major factor for this demise. But, the authors make a point that a single CEO can’t lead to a disaster of such magnificence. The authors take a step back, identify the loopholes in organisational practices since the times of Jack Welch, and point out the aggravations during the times of Jeff Immelt.
The authors discuss the near-fraudulent financial practices of GE Capital that grabbed the attention of regulatory authorities. Environmental ignorance further deteriorated the public image of the firm. Hefty mergers and acquisitions, particularly of businesses of which GE had no prior experience or foresight, became another reason for the problem. High dividend payments and consistent rise in share prices led to inflation of egos in senior executives and investors who became another hurdle in any serious attempt of rectifying the scenario.
Though the authors present a gloomy scenario of many things that flopped and how each was clearly going to flop considering contemporary circumstances, there were decisions that had been riskier but could have turned fruitful. It’s a well-known fact that the outcomes of risky decisions can be judged easily from hindsight, but not so from foresight. And, authors fail to take into account how a proper risk portfolio should be managed by the CXOs of the GE, and they should not implicitly suggest CXO aspirants to take a conventional path.
In its entirety, amid the stories of successful CEOs, this book gives a practical understanding of how tough the business is and the role of a CXO is. It acquaintances the readers with the set of challenges faced by a CXO and the serious scrutiny a CXO has to go through if a set of decisions fails to take shape as expected. A good read for the holiday season.
General Electric, the “Edison company” which once used to be the USA’s industrial poster boy, got reduced to almost irrelevance within a period of 2 CEOs. Though rags-to-riches stories make us optimistic, we must pay heed to riches-to-rags stories once in a while to be rationally optimistic.
Ted Mann and Thomas Gryta make serious attempts to unearth the pride and delusion of the company, especially that of its senior management, that led to this unexpected fall. The authors tangibly point out how complacency, delusion, and big ego may lead to the collapse of an entire empire. Usually, compliments are endowed upon Jack Welch and Jeff Immelt is portrayed as the major factor for this demise. But, the authors make a point that a single CEO can’t lead to a disaster of such magnificence. The authors take a step back, identify the loopholes in organisational practices since the times of Jack Welch, and point out the aggravations during the times of Jeff Immelt.
The authors discuss the near-fraudulent financial practices of GE Capital that grabbed the attention of regulatory authorities. Environmental ignorance further deteriorated the public image of the firm. Hefty mergers and acquisitions, particularly of businesses of which GE had no prior experience or foresight, became another reason for the problem. High dividend payments and consistent rise in share prices led to inflation of egos in senior executives and investors who became another hurdle in any serious attempt of rectifying the scenario.
Though the authors present a gloomy scenario of many things that flopped and how each was clearly going to flop considering contemporary circumstances, there were decisions that had been riskier but could have turned fruitful. It’s a well-known fact that the outcomes of risky decisions can be judged easily from hindsight, but not so from foresight. And, authors fail to take into account how a proper risk portfolio should be managed by the CXOs of the GE, and they should not implicitly suggest CXO aspirants to take a conventional path.
In its entirety, amid the stories of successful CEOs, this book gives a practical understanding of how tough the business is and the role of a CXO is. It acquaintances the readers with the set of challenges faced by a CXO and the serious scrutiny a CXO has to go through if a set of decisions fails to take shape as expected. A good read for the holiday season.