(Nayden - continued from front page)

Our record is based on financial success, globalization, acquisitions, and making quality real - none of which will change. But we want to be more productive and more efficient.

So we’ll continue to improve our quality effort, but we will pay closer attention to how our customers feel quality. As a business, GE has felt quality through better margins, lower defect rates, lower investment costs and improved cash flow. But our customers are telling us every single day, “that’s great for GE, but we don’t feel it.” We still have some ways to go on quality but it’s changing the company. It is changing the way we behave and the way we operate.

Capital Times: We understand you and Mr. Dammerman have worked together quite a bit in the past.

Nayden: Dennis (Dammerman) and I have worked together for a long time. Dennis has been on the GE Capital Board of Directors for about 15 years. We also spent eight months together when we were asked to handle Kidder Peabody. That was our first partnership. We intend to have a strong partnership in continuing to drive GE Capital’s growth and earnings record. With his having served as chief financial officer of GE and having been so close to Jack Welch, it is an even bigger and better chance for GE Capital to leverage the rest of the GE businesses. We work very closely with the GE businesses now, like Aircraft Engines, Power Systems, Medical Systems, Appliances and NBC. But we intend to continue to leverage GE’s reputation as one of the premier brands in the world.

Capital Times: Do you see specific challenges in the new millennium that are a cause for changes?

Nayden: One of the major challenges is for us to get more efficient by using quality and Six Sigma. We need to eliminate redundancies to become more productive and efficient, and get better at execution and at operational excellence. We can’t just be great at buying companies. We must be great at operating them. You’ll see us emphasizing true operational excellence and leadership.

The new Centers of Excellence will also help us to become more efficient and to better serve our customers. The centers will free up resources to focus on business development, new technology, and expanding the sales and marketing effort so we can play more offense. Also, the Centers of Excellence will be designed on a Six-Sigma basis to ensure we are delivering customer CTQs every day. Our customers will feel quality and as a result do more business with us.

We’d also like to drive outsourcing and leverage offshore operations, such as India and Mexico, where there is tremendous intellectual talent. We’ll be asking businesses to take advantage of this intellectual capital because they provide another way to become more efficient and productive and, at the same time, serve our customer CTQs.

Capital Times: What keeps you up at night?

Nayden: I generally have what I call “positive paranoia.” We are a performance driven company and the expectations of GE today are extraordinary. Our company trades at a 38 P&E ratio, and that, in and of itself, is a financial benchmark that sets high expectations.

We’re used to the mindset that “as soon as you’re done, you have to start all over again.” The wheel never stops spinning. That is one of the reasons why GE is so successful. You have to prepare yourself for running in a marathon that never stops and, along the way, find ways to sustain and refresh yourself. To give yourself a breather. To relax and have fun.

Capital Times: What energizes you?

Nayden: I try to maintain some balance. I’m an avid sports fan. I love to compete. I run, play tennis and scuba dive.

My family is very important to me. My two children are very active in school. I take every chance I can to participate in their school programs or just to go out to dinner and to a movie with my family. Those things are very important to me.

Everybody has got to look at their priorities. Family is a priority to me, but I’ll admit it’s a challenge. People talk about the whole balance of work and family all the time in the press. What I have learned over the years is that it is really up to the individual, more so than they believe.

Both Dennis Dammerman (left) and Denis Nayden say that hiring, developing and recognizing the very best people will be key to GE Capital's ongoing success.

I think our company is very demanding. We have high expectations of performance. And there is more than enough to do every single day. That won’t change. But we also respect, and I would say “expect,” all of our teams to be very conscious of the rest of their lives and to establish their own priorities. It is up to them to set the priorities. It seems particularly hard for our younger associates. But I would say to them and all of our associates: “You have a lot more control over your own life than you think you do.”

Capital Times: What do you see as our biggest challenges going forward?

Nayden: We need to deliver on shareholders’ expectations. We want to sustain GE’s reputation as being the best. If you are on the best team, you have to keep practicing. You have to keep changing. You have to keep improving, and you have to keep adding the best people to your team.

As we look around at all that we have to do every single day, it is very natural to say, “I want the very best people on my team to help get this job done.” In the end, it is not going to be Dennis Dammerman and Denis Nayden making this happen. Our job is to lead, challenge, train, nurture, motivate — all of those things. But it is the collective capability of all of our people that will deliver the results.