Darrell Norton's Blog [MVP]

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Managerial Things Not to Do

Apparently GE is considering selling its century-old appliances business.

General Electric CO said on Friday it may sell or spin off its century-old appliances unit in a bid to lower its exposure to the slumping U.S. housing market.

Let me get this straight. Right now the housing market in the U.S. is in a slump. So they are going to try to unload a business that is directly affected by this slump at the bottom of the market.

I always thought you were supposed to buy low and sell high, but I guess that's why I'm not in executive management. And these corporate executives get paid a lot more than you do. I guess all that money pushes out the common sense.

Published May 16 2008, 10:39 AM by darrell

Comments

Cynical said:

They're not doing it to make money. They're doing it to post short term profits and boost their quarterly bonuses. THAT's why they get paid more than we do. They're willing to make bad long term decisions for their own short term gains.

# May 16, 2008 3:25 PM

Jason Yip said:

Granted they are suggesting that their appliance business is prone the rise and fall of single market and therefore doesn't align with their strategy for long-term global growth.

Of course, the question I'd be asking is why their appliances were not competitive in the global market.

# May 16, 2008 7:23 PM

zippy said:

Great point, one that they truly understand and have owned for over 100 years. To make matters worse boomers are choosing to modify current homes instead of nursing homes and you still have the largest generation (gen Y) 75 million who are now entering the workforce and looking to buy homes. This is a dumb move strategically long term....shareholders should shut their yap and be patient..

# May 17, 2008 5:42 PM