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Organisational Behaviour At Gec Marconi

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Organisational Behaviour

An Analysis of the Organisational Behaviour of GEC Marconi


1 Introduction 3

1.1 Company History 3

1.2 Methodology 4

2 The Hirst Era 5

2.1 Recap 5

2.1.1 Culture 5

2.1.2 Structure 6

2.2 Effectiveness 6

2.3 Further Issues 6

3 The Weinstock Years 8

3.1 Recap 8

3.1.1 Culture 8

3.1.2 Structure 8

3.2 Effectiveness 9

3.3 Further Issues 9

4 The Simpson Period 10

4.1 Recap 10

4.1.1 Culture 10

4.1.2 Structure 10

4.2 Effectiveness 11

4.3 Further Issues 11

5 Conclusions 12

6 References 13

1 Introduction

This paper is concerned with the organisational behaviour of the General Electric Company Marconi corporation (GEC) and follows on from the analysis already performed by the Grasmoor syndicate team and presented on 5th December 2006.

1.1 Company History

Formed in London in 1886 by two German immigrants, Gustav Binswanger (GB) and Hugo Hirst (HH), GEC started life as a manufacturing operation taking advantage of the rapidly developing electrical industry by making small electrical items, such as light switches and bulbs.

After floating on the London Stock Exchange in 1900 the company continued to grow rapidly and in 1910 HH was appointed Managing Director. The company continued to expand at home and abroad with branches being established in Japan, South Africa, India as well as Europe.

During the First World War GEC began making military equipment, such as signalling lamps and radios, and in 1918 GEC took over Fraser and Chalmers (FC). The takeover of FC moved GEC into heavy electrical engineering and they were instrumental in the formation of the UK's national grid distribution system.

During the Second World War GEC continued to expand its military division and was a major supplier of electrical equipment to the armed services. They were heavily involved in the development of cutting edge technology, such as the cavity magnetron for radar and communications equipment.

HH continued to be Managing Director and Chairman of GEC until his death in 1943. Following his death, his son in law, Leslie Gamage (LG) became joint managing director along with Harry Railing (HR).

Under the leadership of LG and HR, and thanks to external competition GEC began to slow down and profits started to decrease for the first time. However, in 1963 GEC acquired Radio and Allied Industries (RAI) and along with Arnold Weinstock (AW).

AW became CEO in 1963 and immediately embarked on a program of internal rationalisation which rejuvenated GEC. In 1967 GEC acquired Associated Electrical Industries (AEI), one of two major competitors. In 1968 GEC merged with the remaining competitor, English Electric (EE) and became the only large electrical company in the UK.

GEC continued to expand under AW and in 1974 acquired Yarrow shipbuilders (YS) and Avery in 1979, amongst others. By 1979 GEC was the largest private employer in the UK.

In the 80s and 90s GEC expanded its defence arm into modern technology and through joint ventures and mergers became a major defence contractor to the UK government.

AW retired in 1996 and was succeeded by George Simpson (GS). GS focused

the company on the high growth, high technology telecommunications sector by de-merging many divisions including the sale of Marconi Electronic Systems to British Aerospace.

Unfortunately for GS the dot com bubble was about to burst and GEC was hit very hard. GS resigned in 2003 and in 2006 75% of GEC was acquired by Ericsson.

(Marconi website, 2006)

1.2 Methodology

The Grasmoor presentation on this subject focused

on the culture and structure of GEC during three key periods, the Hirst era, The Weinstock years and the Simpson period. This paper shall follow the same structure and we shall begin each section with a recap of the Grasmoor analysis whilst expanding on some areas that were only briefly covered. We shall then consider how effective that analysis proved to be and finally we shall conduct further analysis of the era.

We shall also consider, to a lesser degree the motivation during each era and also reflect on the information available, or not and how effective the frameworks and models have been in this case.

2 The Hirst Era 1886 to 1961

For the purposes of this paper we shall concentrate our analysis on the effect HH had on GEC. We shall ignore GB, as he was in charge only for a short period and information is very hard to come by. We shall also not spend much time analysing LG and HR as their effect was limited.

2.1 Recap

2.1.1 Culture

This was a period of tremendous change in the UK. Technology was advancing rapidly, the British Empire was still largely intact, Britain was a global powerhouse and of course there were two world wars. GEC emerged into this environment in order to take advantage of the rapidly expanding electrical industry.

There were three key areas of cultural influence in this period. Firstly there



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