How GE Got Disrupted

A Culture Of Excellence

The best way to understand how GE got disrupted is by looking at its power business, which got its start as far back as 1882, when Thomas Edison built Pearl Street Station, the first commercial power plant in the US. Since then, GE has dominated the competition, accounting for nearly 30% of the market for electricity generation equipment as of 2015.

Better, Faster, Cheaper

While Jack Welch’s Six Sigma initiative sought to reinvent how GE operated, Immelt’s transformation focused on how the company developed new products. For that purpose, he recruited lean startup guru Eric Ries to implement a more entrepreneurial approach and created the FastWorks program to drive these methods throughout the company.

A March To Dominance

With the Six Sigma efficiency that Jack Welch put in place and the blazing speed of development that FastWorks made possible, GE began looking to further consolidate its position in the electricity generation market. It found the answer with its acquisition of the power division of Alstom, a French company that wanted to focus on its transportation business.

Innovation Needs Exploration

The problem GE finds itself in now is amazingly common. Every business model fails eventually. It’s just a matter of time. Changes in technology, competitive landscape and customer preferences make that a near certainty. That’s why innovation needs exploration. We can’t expect the world to conform to our tidy, linear expectations.



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Greg Satell

Greg Satell

Bestselling Author of Cascades and Mapping Innovation, @HBR Contributor, - Learn more at — note: I use Amazon Affiliate links for books.