Will GE Hand CEO Reins to a ‘Tech-Age' Leader?

BOSTON (06/05/2000) - Is it possible that a techie could be the heir apparent to the legendary Jack Welch as CEO of General Electric Co.? The cover of a recent issue of Fortune magazine has Scott McNealy, CEO of Sun Microsystems Inc., hugging Welch. It's accompanied inside by an article detailing their "best bud" relationship. When asked by Fortune if McNealy would be his successor, Welch declined to comment. At GE's recent annual shareholders' meeting, Welch assured the media that his successor (Welch plans to retire by the end of the year) would be an insider. McNealy sits on GE's board of directors.

At first blush, a Technology Age pioneer would be a least-likely candidate to run one of the world's largest Industrial Age icons. But given Welch's total commitment to the Internet and his creation of a technology-mentoring program for GE executives conducted by tech-savvy twenty- and thirtysomethings, it makes perfect sense.

Welch's final legacy could be his most enduring: positioning GE to be a global leader in business-to-business e-commerce. GE isn't one of the world's most admired and talented companies without reason, and if McNealy becomes the next CEO, it will be a real coup.

By the end of this decade, most top-level senior executives must be more than just acquainted with computer technology, and GE's mentoring program is giving unusually early exposure to senior management for the company's next generation of executives.

These e-commerce and tech-savvy 20- and 30-year-olds will embrace the brave new world wholeheartedly, and GE must do so, too, or the company's famed talent pool will dry up. The next CEO must be a believer and disciple of the Technology Age. McNealy is such a CEO and would bring world-class smarts and Technical Age credibility for this venerable Industrial Age giant.

The effect of this appointment would be to shake up the orderly universe of the traditional brick-and-mortar outfits. Such a departure from mainline thinking would signal a significant psychological shift in succession planning and bring outcries of derision from those of the old school. Should they follow suit? Or sit on the sidelines and watch? They will have to address the future of their mainstream businesses in a new and unsettling light. The decision by one of the world's most respected and admired companies and its CEO can't be ignored or dismissed. I believe a large number of financial services, transportation and retailing companies will embrace the senior IT manager as a serious candidate for the CEO job.

Regardless, if McNealy succeeds Welch, it will be the management story of the past 10 years.

Dick Hudson is CIO at Global Marine Inc., a Houston-based offshore drilling company. Contact him at Dick.Hudson@glm.com.

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