The Bathsheba Syndrome, Jeffrey Immelt, and Why GE Is In Trouble

By now, the story of Jeffrey Immelt, former GE CEO, traveling with, not one, but two corporate jets so that he always had back-up has made the rounds. The Board is outraged and sent out an explanation befitting of a coach for the 5-year-olds’ soccer team in their end-of-the-year ‘Everyone gets a trophy because everyone is a winner” celebration. The GE spokeswoman lauded Mr. Immelt’s 30 years of “dedicated service.” Worse was Mr. Immelt’s letter in which he explained the need for the second jet because he worked “100-hour weeks with more than 60 percent of my time of the road.” He also added that “GE had a difficult time keeping its planes flying.” The Barometer will keep that warm and fuzzy thought the next time she boards a jet with GE engines, which will be the next flight because GE supplies engines to all the airlines! The Barometer has not seen a chase plane at-the-ready for us in coach.

However, what is missing from the justifications, explanations, excuses, and platitudes is why internal audit missed the practice or said nothing about it. No one in corporate travel said a word until there was a change in the HR VP spot (the officer in charge of corporate travel). The head of HR and general counsel questioned the use of the second plane. So, they did what all bureaucratic messes do — they formed a committee and came up with the brave recommendation to stop the stupid chase plane. The recommendation or order or whatever it was, was ignored. Then came the whistleblower report. Neither VPs, nor corporate committees, nor boards, nor rain, nor sleet nor dark of night can stop a whistleblower. So, the new CEO stopped all private jets, is selling the fleet, and everyone will use commercial flights. Remember, they have GE engines!

GE is investigating so that we on the outside, including investors, can fill in the gaps beyond the “dog ate my homework” justifications being tossed about. GE might have a look at the Bathsheba Syndrome. The name comes from the story of David and…., perhaps the raciest story in the Bible. When the king gets too comfy, hanging around the palace, not fighting battles any longer, and taking advice from no one, you get adultery, a child on the way, the death of Uriah, or, in this case, a chase plane for the CEO’s private jet. There were a few in the palace who saw that something was awry, but no one listened because of an apparent fear of King Jeffrey. He might be doing something stupid and harmful, but he is, after all, the king.

If employees and leaders were willing to let this one slide, imagine all the strategic, production, marketing, and other cost issues they let go unaddressed for fear of the king. The corporate chase jet and the failure of anyone to stop it is symbolic. The events reflect a fearful culture at GE. With no resistance, Immelt took GE down a path of near self-destruction. Imagine, one of the good-to-great, great-to-excellent, built-to-last, Six-Sigma companies that everyone once studied going down in flames. Oh, the symbolism in that sentence. We continue to study GE now, but for a different reason. How is it possible for such a company to destroy itself? The Bathsheba Syndrome was no doubt a big part of it. And the chase plane events tell us it was in play.

About mmjdiary

Professor Marianne Jennings is an emeritus professor of legal and ethical studies from the W.P. Carey School of Business at Arizona State University, retiring in 2011 after 35 years of teaching undergraduate and graduate courses in ethics and the legal environment of business. During her tenure at ASU, she served as director of the Joan and David Lincoln Center for Applied Ethics from 1995-1999. In 2006, she was appointed faculty director for the W.P. Carey Executive MBA Program. She has done consulting work for businesses and professional groups including AICPA, Boeing, Dial Corporation, Edward Jones, Mattel, Motorola, CFA Institute, Southern California Edison, the Institute of Internal Auditors, AIMR, DuPont, AES, Blue Cross Blue Shield, Motorola, Hy-Vee Foods, IBM, Bell Helicopter, Amgen, Raytheon, and VIAD. The sixth edition of her textbook, Case Studies in Business Ethics, was published in February 2011. The ninth edition of her textbook, Business: lts Legal, Ethical and Global Environment was published in January 2011. The 23rd edition of her book, Business Law: Principles and Cases, will be published in January 2013. The tenth edition of her book, Real Estate Law, will also be published in January 2013. Her book, A Business Tale: A Story of Ethics, Choices, Success, and a Very Large Rabbit, a fable about business ethics, was chosen by Library Journal in 2004 as its business book of the year. A Business Tale was also a finalist for two other literary awards for 2004. In 2000 her book on corporate governance was published by the New York Times MBA Pocket Series. Her book on long-term success, Building a Business Through Good Times and Bad: Lessons from Fifteen Companies, Each With a Century of Dividends, was published in October 2002 and has been used by Booz, Allen, Hamilton for its work on business longevity. Her latest book, The Seven Signs of Ethical Collapse was published by St. Martin’s Press in July 2006 and has been a finalist for two book awards. Her weekly columns are syndicated around the country, and her work has appeared in the Wall Street Journal, the Chicago Tribune, the New York Times, Washington Post, and the Reader's Digest. A collection of her essays, Nobody Fixes Real Carrot Sticks Anymore, first published in 1994 is still being published. She has been a commentator on business issues on All Things Considered for National Public Radio. She has served on four boards of directors, including Arizona Public Service (1987-2000), Zealous Capital Corporation, and the Center for Children with Chronic Illness and Disability at the University of Minnesota. She was appointed to the board of advisors for the Institute of Nuclear Power Operators in 2004 and served on the board of trustees for Think Arizona, a public policy think tank. She has appeared on CNBC, CBS This Morning, the Today Show, and CBS Evening News. In 2010 she was named one of the Top 100 Thought Leaders in Business Ethics by Trust Across America. Her books have been translated into four different languages. She received the British Emerald award for authoring one of their top 50 articles in management publications, chosen from over 15,000 articles. Personal: Married since 1976 to Terry H. Jennings, Maricopa County Attorney’s Office Deputy County Attorney; five children: Sarah, Sam, and John, and the late Claire and Hannah Jennings.
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