This year, the undisputed No. 1 in these three prestigious publications is General Electric or GE, despite its not being the biggest, not being the most profitable, not even the fastest-growing, not being the most valuable and despite its stocks languishing in inertia for years. Anvil Business Club’s first Singaporean member Stefan Tong of Keppel Group recently helped work out the sale of Keppel Bank Philippines (formerly Monte de Piedad Savings Bank) to GE, and he believes GE will invest more in the Philippines and he truly admires this American firm.
GE has been No. 1 in the annual Fortune list six times in the past decade, while GE is also ranked No. 1 seven times in the past eight years by Financial Times of London. The scenario is explained as similar to the world’s top golf professionals voting Tiger Woods as "Player of the Year" in 2003 even if it was a lousy year for Tiger Woods and he didn’t win any major championship and wasn’t No. 1 in earnings. Whether good times or bad times for business, like Tiger Woods, GE is admired and loved by the world’s top business people for consistently doing excellent things the rest only wish they could do and for pioneering the best management ideas and practices.
What are the examples of GE’s nearly a century of consistent leadership and excellence in management? Fortune magazine chronicled that from 1892 to 1912, GE boss Charles Coffin pioneered organizational design principles such as the idea that a firm’s most important product was not light bulbs, lights or transformers but managerial talent. In 1900, GE pioneered the first corporate research and development laboratory. In the 1930s, GE used cooperative labor relations, pension plans and profit-based bonuses to prevent chaotic labor unions to destroy the company. In the 1960s, GE led the move towards strategic planning. Of course, who could forget the era from 1981 to 2001 when Jack Welch sizzled as the superstar CEO of GE and icon of progressive capitalism?
GE is amazing at reinventing itself for decades. The whole of the Philippines can learn from one of GE’s gutsy policy of getting rid of the bottom 10 percent of its employees every year. This policy tries to stamp out mediocrity and mental laziness which are contagious within an entire company. Unfortunately, our sanctimonious and idiotic politicians in the Philippines have made it difficult to fire employees (even with just compensation for every year of work history) due to some bleeding-heart socialistic ideas in our laws that are worse than democratic America’s labor regulations! There were many other innovations in management ideas from the leaders of GE which have continuously inspired business people and entrepreneurs worldwide for generations.
For 2006, the Fortune list of the world’s 50 most admired companies are the following and which tragically includes only a few Asian firms such Toyota Motor, Singapore Airlines, Samsung Electronics, Honda Motor, Sony, Toyota Industries, Canon and HSBC Holdings.
1. General Electric; 2. Toyota Motor; 3. Procter & Gamble; 4. FedEx; 5. Johnson & Johnson; 6. Microsoft; 7. Dell; 8. Berkshire Hathaway; 9. Apple Computer; 10. Wal-Mart Stores; 11. IBM; 12. Target; 13. BMW; 14. United Parcel Service; 15. Home Depot; 16. PepsiCo; 17. Costco Wholesale; 18. Intel; 19. Singapore Airlines; 20. Nokia; 21. Citigroup; 22. Coca-Cola; 23. BP; 24. Bank of America; 25. Exxon Mobil; 26. Cisco Systems; 27.* Nestle; 27.* Samsung Electronics; 29. Caterpillar; 30. L’Oreal; 31.* DuPont; 31.* Honda Motor; 33. Walt Disney; 34.* Pfizer; 34.* Sony; 36.* Lowe’s; 36.* Toyota Industries; 38.* Anheuser-Busch; 38.* Canon; 40. Siemens; 41. Walgreen; 42. HSBC Holdings; 43. Tesco; 44. Best Buy; 45. Deere; 46. Verizon Communications; 47. Novartis; 48. BASF; 49. Royal Bank of Scotland; 50. Dow Chemical
Which are the truly great companies of the Philippines and why? How would these compare with Asia’s few truly world-class companies in the "most admired" category? Are Jollibee, SM, JG Summit Holdings, PLDT, Smart, San Miguel, Metrobank, Banco de Oro, Philippine Airlines, Cebu Pacific Air or Globe Telecom part of these companies?
Another reason business people the world over admire GE is because of its durability, it has lasted longer and in great shape than most of its peers or rivals. That should be the dream of every real entrepreneur or leader, to establish and build up a company or organization that can last over a hundred years or many generations. No other American company has been as dominant and as successful for such a long time as GE. Of the 12 firms that Charles Dow put into his original Dow Jones stock exchange industrial average in 1896, GE is the only one still listed in the index, and most of the other companies are dead like ancient dinosaurs. Durability is a sure sign of excellence in a company or organization.
One of the most admirable and smart attitudes of China’s top leaders is their insistence that their world’s fast-growing major economy is "still backward, poor and Third World" whether in tough trade negotiations with the West, or welcome receptions for overseas Chinese entrepreneurs or foreign investors. It is not empty humility, but partly their strategy to prevent their own leaders from relaxing, partly to forestall western economic sanctions on their roaring export sales and partly an admission of honest reality that much still has to be achieved for China to become a truly modern economic superpower. Even wealthy Singapore has leaders who are humble enough to always remind their citizens about their country’s vulnerability, for them to always be vigilant and never stop aspiring for ever greater thresholds of excellence.