General Electric announced this morning that it will reorganize its Energy division into three standalone businesses, aligned with the industries to which they sell.
The group, which comprises about 100,000 employees, will be split into three businesses: Power and Water, led by Steve Bolze; Oil and Gas, led by Dan Heintzelman; and Energy Management, led by Dan Janki. All will report to company CEO Jeff Immelt.
The new world order:
- GE Power and Water — Headquartered in Schenectady, N.Y., with 41,000 employees and expected revenue of $28 billion in 2012.
- GE Oil and Gas — Headquartered in Florence, Italy, with 33,000 employees and expected revenue of $15 billion in 2012.
- GE Energy Management — Headquartered in Atlanta, Georgia, with 27,000 employees and expected revenue of $7 billion in 2012.
The reorganization is expected to “speed decision-making, reduce layers and decrease cost,” the company said. It will be effective in the fourth quarter of this year. GE Energy Infrastructure CEO John Krenicki will oversee the transition, then depart the company later this year.
“Big companies are always fighting organizational complexity,” Immelt said. “We are taking action at a time when the Energy business is doing well. The business had a solid quarter with earnings up 13 percent and has a big backlog of great products.”