CEO Interview: With Mike Grunza from GE Aviation

PUBLISHED: 16:59 26 September 2011 | UPDATED: 20:03 20 February 2013

CEO Interview: With Mike Grunza from GE Aviation

CEO Interview: With Mike Grunza from GE Aviation

It is fitting that Gloucestershire, the birthplace of the jet engine invented by Sir Frank Whittle in 1930, is now a home to the biggest manufacturer of jet engines in the world.

It is fitting that Gloucestershire, the birthplace of the jet engine invented by Sir Frank Whittle in 1930, is now a home to the biggest manufacturer of jet engines in the world.

GE Aviation Systems, part of General Electric, took over Smiths Aerospace at Bishops Cleeve, Cheltenham in January 2007. The campus employs over 1600 people and is the largest private sector employer in Gloucestershire (Wotton-under-Edge based precision engineering company Renishaw is snapping at its heels with a reported 1,450 employees).

GE Aviation Systems Managing Director Mike Grunza estimates that the company probably supports a further 6000 people within a 50-mile radius, thats a lot of people relying on one business from small businesses manufacturing highly-specialised engine components (GE Aviation sources most of its components from around 500 suppliers across in the UK) to catering companies filling the stomachs and feeding the minds of the people working there.

When the GE Aviation Systems takeover was announced, there were understandable local concerns about its intentions, exacerbated in 2008 when the company closed the Smiths Aerospace Arle Court site and making over 100 people redundant.

However, GE Aviation Systems Managing Director, Mike Grunza feels the takeover was advantageous for the Cheltenham campus as GE brings global business relationships to the great products and people from the former Smiths Group. Recent declines in the MOD budgets magnify the benefits of GEs reach, as the campus is well positioned commercially with new customers and joint ventures in China.

While much of the manufacturing is done elsewhere in the world, Britain is valuable to GE Aviation because of its talent for innovation. As Mike puts it: There are a lot of seriously bright, clever people here, he said. It is difficult to compete with China one for one in labour. Depending upon the sector, Chinese labour can be a quarter the cost of their western equivalent.

The UKs true advantage is its innovation and idea creation. But we cant rest on our laurels, China is very committed to advancing its ability to create. Many Chinese, if not more than us, are well educated and committed to high achievement travelling to study in universities across the world rather than staying at home.

Mike thinks its the power of capitalism that encourages free thinking and gives people the opportunity to bring their ideas to fruition because of the potential financial rewards.

Communism does not encourage personal financial gain. Where he does think there is room for improvement in the UK is in terms of process to be frank, ideas are not enough and we have to ensure that good ideas are developed and manufactured efficiently and that means innovative new processes for doing so.

Currently, the energy of many of our brightest people goes on the idea and much less time and thought is invested in how to manufacture it here for the same, or less, than elsewhere and thats a skill we must develop, he says. Surely that means employing even fewer people on the production lines?

Yes probably, admits Mike, but if efficient processes were developed perhaps those same production lines could be in the UK rather than abroad and more people could be involved in development.

We need as many people involved in developing innovative process and production techniques as we do coming up with the big ideas, he adds. And so we move on to Mikes biggest concern for industry any industry: The importance of a highly-skilled workforce.

GE Aviation employs 80 apprentices every year, is a major supporter of the Cheltenham Science Festival and has a number of active school support programmes, including GirlsGetSET, which encourages girls in years 7, 8 and 9 (11-14 years) to consider engineering as a career. The company also works with teachers, advising them on opportunities in manufacturing and design which they can share with students.

The future for a thriving manufacturing industry is a highly-skilled workforce, but this isnt going to happen overnight. Investing in young people means at least a 7-year pipeline, he says. Visiting schools and meeting young people, we can inspire them and encourage them to look at our industry. We can also spot early potential and nurture that through to university, where we will sponsor promising students and offer internships.

GE Aviation competes for a small pot of talent along with other companies such as British Aerospace and Agusta Westland, which probably run similar engagement strategies, and everyone wants that pot to get bigger. One of the more promising signs of the UK recession (to date and Im writing this in September as the financial markets are experiencing high levels of volatility) is that unemployment, bad though it is in some parts of the country, hasnt yet reached the levels some feared.

This is in part because companies such as GE Aviation are trying their hardest to hang on skilled staff, offering them shorter working weeks rather than redundancy, in a bid to retain skills. And behind the scenes, according to Mike, many large companies are actively collaborating not to lose staff out of the industry, by sharing out talent amongst them.

Many larger companies have realised that we must work together for the benefit of our industry as a whole, he said. If one technology company has skilled staff it can no longer retain, the rest in the industry know about it.

When there isnt a violation of competition agreements, we try to work together to ensure great talent has opportunities to stay in the industry. This shouldnt be just a big company strategy. Mike suggests this is a policy that could work with smaller companies across the Cotswolds.

Times are tough for a lot of local businesses right now, but not investing in people is a self-fulfilling prophecy. While any one of these businesses individually may not be able to employ dedicated apprentices, together they could fund a pool of talent to move where needed and where is affordable.

So, the message from one of the Cotswolds biggest businesses is: Work together to boost skills because necessity is the mother of invention and inventions are the lifeblood of business.

About Mike Grunza

Mike took over as Managing Director of GE Aviation in 2009, bringing his wife and two children, aged 7 and 9, over from the States with him. They live near Gretton in a converted barn, love the way they have been welcomed by new friends and neighbours and, two years into their new life, are still bowled over by the history and architecture of their adopted country. They regularly travel across the UK and Europe soaking up the atmosphere.

His favourite town is Winchcombe. Its small splendour is all the greater because it functions properly as a town with all the essential shops and services, he says.

The family also love the fact that the British countryside is open and every walk ends in a pub or a church.

Thanks to the British laws we can walk unchallenged across the highways and byways of England, he adds. The most they will experience in the Great Cotswold Countryside if they stray off the beaten track is the verbal wrath of the farmer. In America, the land of the free and of liberal gun laws, its a little more tricky.

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