New Boeing Co. chief executive James McNerney used techniques pioneered at General Electric to cut costs and improve performance as CEO of 3M, according to published reports.
That’s something McNerney will bring to Boeing, which has been trying to adopt more of GE’s techniques, Teal Group analyst Richard Aboulafia said.
“He’s going to set a tone, migrating over from GE,” Aboulafia said. “He’ll be great at execution.”
McNerney spent 19 years as a GE executive under Jack Welch, one of the most admired CEOs of the last 20 years. He went to 3M in 2001, the first outsider to run that company in its 100-year history, bringing with it a briefcase full of GE techniques.
According to a 2002 article in The Wall Street Journal, McNerney cut costs and work-force numbers, introduced new management techniques and doubled targets for sales and profits.
But McNerney “resisted barking orders and set about trying to win the hearts and minds of employees,” according to the Journal.
“You can’t order change,” McNerney told the newspaper. “After all, there’s only one of me and 75,000 of them.”
McNerney was casual – typically the only executive at meetings not wearing a tie – blunt, fast-talking and insistent on seeing lots of financial data, the Journal reported.
That was a shock at 3M, where the corporate culture emphasized collegiality over candor, senior vice president Bob Burgstahler told the Journal.
And yet, McNerney didn’t come across as dictatorial, Burgstahler said. “Jim doesn’t say, ‘You’ve got to do this.’ Instead, he says, ‘3M has this tremendous reputation and global presence and great technology, and I see all these opportunities we can leverage if we get on the same page and help each other.”
McNerney told the Journal that “innovation is in the DNA” of 3M’s people “and if I kill that entrepreneurial spirit, I will have failed. My job is to build on that strength, corral and focus it.”
McNerney echoed that Thursday with a statement saying he intends to “ensure that we continue to harness the innovative energy of our people and the cutting-edge technologies they are developing.”
In recent years, Aboulafia said, Boeing has focused on profitability at the expense of losing market share to Airbus, which has spent heavily on new planes while largely ignoring its shareholders.
If McNerney can duplicate his success at 3M, Boeng’s future is bright, he said.
“What if Boeing could be the first to get both right?” Aboulafia said. “If there’s anybody who’s going to do it, it’s him.”
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