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Eye on the Middle Market GE Capital, the financial services unit of the General Electric Corporation, recently worked with The Ohio State University's Fisher College of Business to create the National Center for the Middle Market. At the center, GE Capital executives will work alongside Fisher professors to deliver courses and conduct research devoted to middle market companies. (For another example of an industry-academic collaboration designed to enhance the business curriculum, see "Corporations on Campus," page 28.) Mike Pilot, GE Capital's Chief Commercial Officer, heads the company's sales and marketing activities, and he will teach in Fisher's middle market programs this fall. Pilot and other GE executives will incorporate some of the training methods GE employs at the John F. Welch Leadership Development Center, its corporate univer- sity in Crotonville, New York. Here, Pilot explains why a partnership with Fisher College is important to GE Capital's corporate strategy, how it helps the company connect to its largest cus- tomer base, and how GE Capital approaches its own executive development needs. Why is Fisher's focus on the middle market important to GE Capital? We have more than 1 million commercial customers and more than 80 million consumer customers globally. But our biggest segment is our middle market customers, which we describe as com- panies with revenues between US$10 million and $1 billion. These companies don't have government agencies like the Small Business Association devoted to them, and they don't get as much atten- tion from policymakers or lenders as the big companies do. Yet this segment represents over a third of all jobs in the U.S. economy. While the U.S. workforce shrunk by 4 million jobs during 2010, the middle market created 2 million jobs. We partnered with Fisher to create the center because we want to know what makes these companies success- ful, what makes them unsuccessful, and what challenges they face. What have you learned so far? Last fall, we released the results of our first survey of middle market compa- nies. We found five characteristics that describe what we call "growth champi- ons." First, they have a sharp focus on customers. Second, they possess broad geographic aspirations. Third, they con- tinually invest in innovation—in research and development—at a higher rate than their peer groups. Fourth, they have strong management cultures, where they set performance goals, create firm busi- ness plans, and allocate the human and financial resources needed to execute those plans. Finally, they have superior talent management, from recruitment all the way through retention and training. With Fisher, we've developed a cur- riculum focused on those five areas. It's for the chief financial officer of a $200 million-a-year food company in Ohio, not for the CFO of GE or for someone who's just starting a business. Does this partnership help you anticipate future challenges? It absolutely does. That's one of the great advantages of having academics and practitioners work so closely together. It's great when faculty or students can ask a GE executive, "How are you think- ing about things like scenario planning or incubator investing?" But nobody has a crystal ball. Talking and networking with different people helps us identify trends we should keep an eye on. What should business schools consider as they evaluate their own exec ed programs? They need to know that business has moved away from a world where "one size fits all." Also, executive education really needs to include practical problem- solving, where students bring in the problems they face and develop solu- tions. That makes for a richer learning environment and helps students deliver an immediate ROI for their companies. That's almost a ticket to the game today. Something we're trying to do with Fisher is also something we emphasize in our own training—courses that combine academic teaching with practical prob- lem solving. Case studies provide a good framework for academic teaching, but real-world examples are more engaging. We try to get a real return on investment in training by coming up with answers to problems that our units are facing today. Finally, team-based learning is very important. At GE, we moved to a model of team-based learning about five years ago. So, for example, we'll bring intact teams working in GE Capital to our education center in Crotonville to go through courses together and work on problems they're trying to solve. When you bring in teams of three to five executives to learn a new topic—for instance, to examine an emerging trend like social media—they gain a better understanding of how to apply that knowledge to their work. Mike Pilot of GE Capital instructs a course delivered through the Fisher College's National Center for the Middle Market. BizEd July/August 2012 27