SHARING THE DEPRESSION BURDEN---GE STYLE

One of the reasons that GE was so successful was the LEADERSHIP of Gerard Swope and Owen Young during the depression... this is an excerpt from my latest book: THE SECRET TO GE's SUCCESS...
"In 1929, the stock market collapsed and the world suffered the greatest economic depression in modern times. As noted, GE's revenues dropped more than 75% during the period. In comparison to many of its peers, who instituted sweeping layoffs---and in many cases put skilled and loyal employees out on the street--Swope and Yound were both more compassionate and more pragmatic. They recognized that if they wanted to keep talented people, they would have to take steps to minimize the Depression's impact on them.
Three programs were introduced:

1. Unemployment benefits. GE provided loans and relief to those workers the company could not continue to employ.


2. Guaranteed work program. GE's electric lamp business allowed workers to share the pain. Instead of just laying off 20% of the workforce, it instituted a program to allow employees to reduce their work hours from five to four days. Because each worker took a 20% reduction in pay, the program permitted GE to keep everyone employed.


3. Profit sharing in the 1930's. Another important innovation of the Swope/Young era was the introduction, in 1930, of a profit-sharing plan. This was unique in several ways. First it was offered at a time when many companies were having trouble simply surviving. Second, it was offered to all employees, regardless of their position in the company. Again, this plan was consistent with the socialistic philosophies held by Swope and supported by Young."

Read the entire story of the genius of Swope and Young---models of REAL LEADERS from which today's CEOs could learn...especially GE management..

Bill Rothschild, author of COMPLETE STRATEGIC LEADERSHIP LIBRARY...