George David has been CEO of United Technologies Corporation (UTC) for more than a decade. During that time he has received numerous accolades and awards for his performance as a CEO. Under his leadership UTC, a $343 billion conglomerate whose operating units include manufacturers of elevators (Otis Elevator), aerospace products (including Pratt & Whitney jet engines and Sikorsky helicopters), air conditioning systems, and fire and security systems, has seen earnings grow at 10–14 percent annually—impressive numbers for any company but particularly for a manufacturing enterprise.
According to David, a key to United Technologies’ success has been sustained improvements in productivity and product quality. The story goes back to the 1980s when David was running the international operations of Otis Elevator. There he encountered a Japanese engineer, Yuzuru Ito, who had been brought in to determine why a new elevator product was performing poorly. David was impressed with Ito’s methods for identifying quality problems and improving performance. When he was promoted to CEO, David realized that he had to lower the costs and improve the quality of UTC’s products. One of the first things he did was persuade Ito to work for him at UTC. Under David, Ito developed a program for improving product quality and productivity, known as Achieving Competitive Excellence (ACE), which was subsequently rolled out across UTC. The ACE program has been one of drivers of productivity improvements at UTC ever since.
Early in his tenure as CEO, David also radically reorganized UTC. He dramatically cut the size of the head office and decentralized decision making to business divisions. He also directed his accounting staff to develop a new financial reporting system that would give him good information about how well each division was doing and make it easier to hold divisional general managers accountable for the performance of the units under them. He then gave them demanding goals for earnings and sales growth and pushed them to improve processes within their units by implementing the ACE program.
At the same time David has always stressed that management is about more than goal setting and holding people accountable. Values are also important. David has insisted that UTC employees adhere to the highest ethical standards, that the company produce that have minimal environmental impact, and that employee safety remain the top consideration in the work-place.
When asked what his greatest achievement as a manager has been, David refers to UTC’s worldwide employee scholarship program. Implemented in 1996 and considered the hall-mark of UTC’s commitment to employee development, the program pays the entire cost of an employee’s college or graduate school education, allows employees to pursue any subject at an accredited school, provides paid study time, and awards UTC stock (up to $10,000 worth in the United States) for completing degrees. Explaining the program, David states, “One of the obligations that an employer has is to give employees opportunities to better themselves. And we feel it’s also very good business for us because it generates a better workforce that stays longer.”
David states that one of his central tasks has been to build a management team that functions smoothly over the long term. “People come to rely upon each other,” he says. “You have the same trusting relationships. You know people; they know you. You can predict them; they can predict you. All of that kind of begins to work, and it accelerates over the tenure of a CEO. If you have people bouncing in and out every two to three years, that’s not good.”
According to Sandy Weill, former chairman of Citicorp and a UTC board member, David has the right mix of toughness and sensitivity. “When somebody can't do the job he’ll try to help; but if that person is not going to make it work, that person won't be on the job forever.” At the same time Weill says, “He does a lot of things that employees respect him for, I think he is a very good manager. Even though David is demanding, he can also listen—he has a receive mode as well as a send mode.”
Q1. What makes George David such a highly regarded manager?
Ans.: As a CEO of United Technologies Corporation (UTC), George David has created the ambience of company with decentralization decision making by creating several business partitions. David was very helpful, who does lot of things for his employees.
Q2. How does David get things done through people?
Ans.: David gets things done through people with the help of
decentralization method and cutting the range of head offices into various divisions. David controlled and managed each and every segment, such as financial, accounting, productivity and many more with a trustworthy liaison with their employees; in the same time employees dedicatedly prove themselves with their total effort and skill in counter.
Q3. What evidence can you see of David’s planning and strategizing, organizing, controlling, leading and developing?
Ans.: The Achieving Competitive Excellence (ACE) which rolled-out across UTC to improve product quality and productivity, proved the implementation of planning and strategy methods by David. The decentralization system and directing the accounting staff to prepare a new financial reporting system with appropriate and good information about various divisions, say how David was a good organizer too. The persistence of tremendous ethical principles with low environmental collision and protection for their employees tells the controlling methods used by David at UTC.
Implementation of worldwide employee scholarship program, for the total academic development of UTC employees, towards maintaining and creating a benchmark for UTC, tells us the leading and developing process used by David.
Q4. Which managerial competencies does David seem to posses? Does he seem to lack any?
Ans.: In this concert, George David has all the managerial competencies and proficiencies that make him highly regarded personnel of UTC. As Sandy Weill said, David has the right mix of toughness and sensitivity. It is very true that, he has toughness towards the company and sensitivity towards his people. Whatever David does, that only in favor of UTC as well as for the beneficiary to their employees. Due to which, UTC employees respect him and thought him as a good manager. He doesn’t lacking anything.
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