Lights Out - Thomas Gryta & Ted Mann

[Xerxes]

Lights Out: Pride, Delusion, and the Fall of General Electric: Gryta, Thomas, Mann, Ted: 9780358250418: Books - Amazon.ca

 

I work for one of General Electric' competitor, and I was always fascinated how no matter what GE did (good or ill), they always make it to the front page, and that was not the case for its competitors. It was all about the lingering Welch' mystique. 

 

I really enjoyed reading this book. Was familiar with the story but it was a pleasant read and connecting all the dots.

Reading this book, you really grasp how an institution can bury itself under massive layers of fat, unable to move and dislodge itself, while everyone just squeeze as much milk as they can from it, while they can. Contrast that with Berkshire with the CEO owning +20% of the stock and 99% of his own wealth.

 

I will be also reading the one Jeff himself wrote. Very soon.

[dwy000]

Having worked there and knowing many of the players I was a little disappointed that there wasn't a little more substance to the book.  There was a decent amount about culture and Welch and how Immelt operated and his personality (which they nailed).  But I wanted to know more about the background to much of the M&A and the troubles in Power that almost brought them down, and the rationale behind the software debacle, etc.  These were not dumb people and while the bureaucracy could be overwhelming, there were a lot of really, really smart people and there were a lot of things that were done right.   It took a new culture to realize it.  

[Xerxes]

Thanks for your thoughts, certainly GE Aviation has been an incredible company with the reach and the moat they have had. Great company, means great people.

My comment was mostly about the corporate level of GE. The Alstom deal was almost comical.

 

Reading this book, it make me really appreciates what we have with Berkshire Hathaway. I have every trust in Greg Abdel, but I hope Buffett's shadow won't imped him like Welch's shadow impeded Immelt.

 

I would be a buyer of GE Aviation stock once it spins of Healthcare and Power (*cough* Alstom *cough*).

[dwy000]

13 hours ago, Xerxes said:

Thanks for your thoughts, certainly GE Aviation has been an incredible company with the reach and the moat they have had. Great company, means great people.

My comment was mostly about the corporate level of GE. The Alstom deal was almost comical.

 

Reading this book, it make me really appreciates what we have with Berkshire Hathaway. I have every trust in Greg Abdel, but I hope Buffett's shadow won't imped him like Welch's shadow impeded Immelt.

 

I would be a buyer of GE Aviation stock once it spins of Healthcare and Power (*cough* Alstom *cough*).

Agreed.  Actually Healthcare is a decent business too although they had to sell some crown jewels in the biopharm business to Danaher.

 

I wanted the book to go into Alstom better - in hindsight it was a disaster but at the time everyone was calling it a coup.  I wanted to understand the rationale for it - esp after selling NBC cheaply. 

 

Aviation is an incredible business. There are really only 2-3 credible players so its an oligopoly.  Good tailwind (no pun intended) too. 

[ratiman]

GE under Immelt sounds a lot like IBM. Predix is basically Watson, a vaporware AI layer on top of all its industrial machinery. The fact that it took years for GE & IBM to admit that it was all nonsense, after spending hundreds of millions on advertizing, is kind of amazing. Immelt was a P&G product manager in his first job, and that's the mentality he brought to running GE, with lots of consumer advertizing and rapid buying & selling of brands. Unfortunately industrial machinery is nothing like soup or detergent and GE spent billions chasing after fads. It's amazing that Immelt lasted 16 years when he clearly wasn't suited to the job. The biggest difference between Immelt and Welch appears to be be that Welch was willing to hear bad news.

Edited April 10, 2022 by ratiman

[dealraker]

5 of us penned "The 12 Ways GE Misleads Investors" in the year 1999.  While few were ever willing to read this, no one ever contested the facts of our presentation.  Jack Welch in my view is, and likely will always be relative to GE's size in the market at that time, the biggest financial fraud in history.  But he was untouchable, and to some degree still is.  Life is great if you can stand it.  

[Jaygo]

I was surprised by the bit about Immelt getting on his hands and knees fixing compressors on broken GE refrigerators, it seems like a long way to having two private jets flying around in case one malfunctions. I guess power and money really do corrupt.

 

My main takeaway is a large conglomerate can really fudge the numbers and hide a ton of bad operations. The book is making me consider what is going on in some of the mini conglomerates ive been checking out. Is it really possible to keep a good operation going that is so decentralized? 

 

I'm sure BRK has an enormous amount of issues too. Ill never forget being in a Sees candy in Arizona and the shopkeeper gives us about a pound of samples, when i finally said "ok, ok were good" she simply said. "you know who owns this store? well he's richest man in the world!"

 

I felt like saying " I do b-t-h "   with my 120 shares at the time lol

 

Does Omaha even care about some of the tini businesses anymore?