Good morning. Of all the turnarounds in the past several years, few rival what Larry Culp managed to do for General Electric. Tapped as the first outsider to run GE in late 2018, Culp split the moribund conglomerate into three Fortune 500 public companies: GE HealthCare Technologies, GE Vernova and GE Aerospace. The first to spin off was GE HealthCare, which went public on the Nasdaq exchange on Jan. 4, 2023. Since then, its stock is up almost 50%. (GE Vernova is up 400% since its April 2024 debut, thanks in large part to AI-driven electricity demand, while GE Aerospace has more than doubled.)
I recently spoke with GE HealthCare CEO Peter J. Arduini about how he’s been forging a new chapter for the $20 billion-a-year medical technology and digital health company while drawing on GE’s legacy. Arduini spent much of his early career at GE under the leadership of Jack Welch and then Jeff Immelt, leaving in 2005 before Culp wooed him back.
Our conversation reminded me why GE was revered for much of its 133-year history. This was the company that Thomas Edison built, with a management system so potent that investors once believed it could be applied to light bulbs, nuclear reactors, Saturday Night Live and its opaque GE Capital finance arm with equal results. At its peak in 2000, GE’s market cap hovered around $600 billion, more than $1 trillion in today’s dollars. Then came the dot-com crash, 9/11, the Enron scandal, and the 2008 financial crisis, not to mention some fumbles under Immelt, who never managed to recreate the aura of his predecessor. The gold standard for global leadership was deemed too big to manage and broken up.
But Arduini has tried to revive much of what made GE special, from how it developed people to how it produced products. “The GE model was really stellar, and, honestly, prior to Larry coming back, some of that had dissolved. We didn’t even really do performance reviews in the same way and he brought that back,” said Arduini. “I tried to take the GE of old and took what was really good: how we think about our distribution of leadership, how we actually talk about leader development, how we build out our own Crotonville virtual university of development.” That said, he doesn’t yearn to be part of the behemoth he left behind. “When you’re in a larger business, in many cases, decisions take longer. And focus matters in our business. It is all about signal to noise; you want more signal, less noise. In a larger company, there has to be a little bit more noise.” Click here for the full interview.Contact CEO Daily via Diane Brady at [email protected]
This story was originally featured on Fortune.com
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