To survive, the American giant General Electric is divided into three: the energy and healthcare sections will become new and autonomous companies, while the aviation sector will continue to focus on the original company. The operation aims at increase efficiency, also for recover lost ground on Wall Street, where operators usually positively evaluate this kind of initiative.
Founded in 1892 in Schenectady, New York, General Electric has long been the standard bearer of the large American manufacturing multinationals and to date is the last representative of the original Dow Jones (although its tenure on the index ended in 2018).
The group's decline began in 2008, when the crisis brought the finance division to its knees. At the time, the company had stakes in a variety of industries, including television, where it controlled NBC. It was a way of doing business founded on the belief that the highest possible level of diversification was needed to be successful. But the world had changed since the 900s – as demonstrated by the rise of the Silicon Valley giants – and General Electric was no longer able to recover from the crisis.
One after the other, the assets were sold or spun off (from oil to gas, from household appliances to locomotives, passing through financial services), but by then it was too late: none of these operations was enough to trigger the relaunch. And so, in 2018, an external manager came to lead the group, Larry Culp, who was entrusted with the task of revolutionizing the group. The first move was cut costs by cutting employees in half, down from over 300 in 2014 to 161 today. The deal now completes with the division of General Electric into three parts.
The healthcare sector, which mainly deals with the production of machinery for hospitals, will be entrusted to Peter Arduini, while Scott Strazik will take control of the energy division, which is merged with that of renewables. Finally, John Slattery will lead aviation and Culp will keep the seats of president and CEO to manage the completion of the spinoffs, with the prospect of remaining to lead what will remain of GE, that is the part dedicated to aircraft.
