Doug McIntyre this morning posted on General Electric Co.'s (NYSE: GE) decision to cut $750 million in costs from its NBC Universal unit. What interests me about this story is the signal it sends to Jeff Zucker, chief executive of NBC Universal's television group, that his time at the helm is likely over.
As a GE shareholder I have been less than pleased with the job that current CEO Jeff Immelt has been doing. GE stock is way below its 2001 peak and while it has recovered from its low, the logic for having all of GE's diverse businesses together strikes me as elusive. Thus GE is suffering from a conglomerate discount.
I think Immelt has had his chance but he's clearly failed to turn GE into a growth stock because he has been unable to re-conceive GE's corporate strategy as his predecessor did. I also think it's time to jettison the formerly admired Jeff Zucker, protege of NBC Universal television group's chairman, Robert Wright. With the success of Walt Disney Company's (NYSE: DIS) ABC's Dancing with the Stars, Grey's Anatomy, and Desperate Housewives, it's a mistake to think that networks can't create popular programs.
It's just that NBC has lost the edge it enjoyed in the 1990s. And it's time for changes at the top.
Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, and a Professor of Management at Babson College. He owns shares of GE, not Disney.
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Reader Comments (Page 1 of 1)
10-19-2006 @ 10:43AM
John Brougher said...
I totally agree with this comment. I am a GE stock holder and think GE needs a new CEO. It appears GE is behind the power curve most of the time with CEO forgetting he works for the stockholder not to turn the country green.
If GE were practicing the 10-90-10 rule where the bottome 10% were fired the CEO would have been gone several years ago. As a retired GE engineering manager, I think some one needs to run GE like Jack.
10-19-2006 @ 1:18PM
Nile Latta said...
as a GE shareholder I agree its time for change both in management and corporate direction.
10-19-2006 @ 4:51PM
Jose Moreno said...
I am a former GE employee and I miss the Jack Welch years. Jeff Immelt needs to shape up or pack up... I am almost retired and my GE shares have been almost dead since he became CEO. I completely agree with Peter Cohan
10-19-2006 @ 6:35PM
Jose Moreno said...
I entirely agree with Peter Cohan, Immelt MUST GO. How long do we have to wait? A great company like GE lagging behind???
10-19-2006 @ 5:24PM
Tom said...
Totally agree...I worked for a GE company until March when I got tired of the constant flip flopping on direction,strategy and revolving door management with each having to re-invent the wheel..,and Corporate or semi-corporate pushing some new strategy of the month...decided unemployment was better than the stress of drinking the GE Kool Aid...I have worked for other large corporations.. GE has been found out by Wall Street...what the employees have known for years..
10-19-2006 @ 6:22PM
Ron Rollo said...
We have been waiting for more than 3 yrs for GE to move upward and nothing happens! I think it is time for Immelt to prove all the hype when he came in had some substance or get out of the way!! As for Universal and Zucker, NBC shows stink and they are so far behind that a change is obviously needed. The bulls are running and GE is getting trampled in the stampeed!
10-21-2006 @ 3:59PM
Dave said...
I too am a former GE employee, who owns GE stock, though I have lessened its exposure in my old S+SP (401k) program. I have been disappointed by the company's performance. Dividends are nice, but I believe the company's behind the curve. As for its NBC subsidiary, I am also a former NBC employee, going back to RCA ownership.
What -does- Mr. Zucker have on someone to continue bringing the network down?
10-22-2006 @ 1:38PM
Louis Coco said...
I am a former GE employee and currently have thousands of GE shares in my portfolio.
I believe Jeff Immelt is doing a good job of running GE. Profits and revenues increase every year and it appears that he is also taking the company in the right direction for future growth. One item I do fault him on is not being agressive enough in defending the company against negative comments from analyst. Also, since the stock dosen't appreciate very much GE stockholders need a good reason to own it with their money at risk. I believe a much bigger divend is needed.