The Fast Company Interview: Jeff Immelt

What makes a growth leader today, and how does that differ from the sort of leader who was effective at GE in the past?

GE has always been a believer in leadership development. When the economy was growing 5% a year, when oil was $14 a barrel, and when the world was at peace, the science of management was all about the how-to. That was the how-to generation. You didn't have to think about the what. Instead, there were management initiatives such as Six Sigma, which was the how.

So most of management literature, certainly for the past 10 years, was all about the how-to. I think we're now in the what-and-where generation. Global economies are slow and more volatile. Oil is at $50 a barrel. So this ability to pick markets, growth trends, customers, and to do segmentation -- that is management today. We have a generation of people who know how to do process flow charts. We have a generation of people who know how to do quality function deployment and things like that, but don't necessarily know why we're doing them. What's the what and the where? I believe that wholeheartedly. Nothing is completely black and white, but we are in a completely different cycle of what good managers know how to do.

It would seem a hell of a lot harder to develop foresight in managers than a simple how-to.

It's a challenge, but it's the pervasive challenge of the business world, this company, and this country. Almost every personal friend I have in the world works on Wall Street. You can buy and sell the same company six times and everybody makes money, but I'm not sure we're actually innovating. I'm not sure that taking a chemical company from an AA-rated balance sheet to junk is innovation. Our challenge is to take nanotechnology into the future. We've got to do personalized medicine. We've got to do renewable energy. And that's what GE can do with its great people. In this generation, this company can do what it did in the last generation. But it's going to take different skills.

And the assumption of different kinds of risks. Do you make it easier for GE leaders to take those risks?

At [GE's training center in] Crotonville, you'll hear me talking about risk taking. I'll ask people, "How many of you think it's just BS?" And half the people in the room will raise their hands. They say, "It doesn't exist in my business." So it gives you a great chance to hone your message.

Do you worry about our country's ability to innovate?

I do. We have a great ambience of entrepreneurial spirit. We've got capital markets that support it. But we've lost our love of technology. You can look at the number of engineers who are going to school here versus outside the country.

Have we also lost our desire?

I worried about that in the presidential election when you hear one candidate going after another, saying every American deserves a job, no matter what. You watch us run up debt as if there is no consequence to having a low savings rate or a budget deficit. Look, there are consequences to all that. But when I see a 22-year-old graduating from the University of Wisconsin, I see someone who wants to see the future and make a real contribution.

Do you think outsourcing is killing America?

I think it's a ruse, a complete and total ruse by people who don't want to face what the real problems are. The real problem is that 30% of the people getting a college degree in China and India are getting an engineering degree. That number in the United States is 4%. The fact is, we don't value engineering, and that is how manufacturing jobs get created.

Are you concerned about your daughter Sarah's future?

I'm not, because I think the United States has a resiliency that is amazing. At some point, in the next 5 or 10 years, this country will decide whether it is a manufacturing or a service economy. That is very much in the balance in the next 5 or 10 years. She may be a lawyer, a banker, work on a TV show, or something like that. Whether she works in an industrial environment is not so sure. And I'm not so sure it matters. When I travel in Europe, the best economy by far is the UK, and there is zero manufacturing there.

If you weren't CEO, what would you really love to be doing?

In some next life, I want to do something where I could give back. Teaching is one way. I would probably teach business, somewhere, someplace, somehow. I'd love to say I could teach math, but I can't even help my daughter with that.