What to Expect in the General Electric Financial Management Program (FMP) in the U.S.
If you work at a multinational conglomerate, does it matter where you work?
In other words, if a company operates in 180 countries, could there be big differences between those countries?
The answer is yes.
One of the best examples is the GE Financial Management Program, which we covered in a previous series (from an author based in Europe).
But GE as a company has changed over time, and different regions have changed over time as well.
Our reader today found this out firsthand when he recruited for the program and then accepted a full-time role in a core industrial business there:
Introductions, Facelifts, and Makeovers
Q: Can you give us a 60-second overview of what has changed about the GE FMP (as of 2017-2018) and what might be different in the U.S.?
A: Sure. Here are the major differences:
- GE Capital is Gone – 95% of it has been sold off, so you no longer do rotations there. The main divisions for rotations are now Aviation, Power (which includes Energy Connections, Renewable Energy, Current, etc.), Healthcare, and Transportation.
- The Rotations are Different – Controllership is no longer a required rotation; the main options are now FP&A, Commercial Finance, and Supply Chain Finance.
- GE is Going Digital – The company is transforming from a giant conglomerate into a “digital industrial company.” They created a new business line called “GE Digital,” and they’re developing a new platform (“Predix”) that will drive most of the revenue increases over the next 5-10 years.
U.S. and European FMPs tend to do rotations within a specific business line, such as Power or Aviation, while FMPs in the rest of the world tend to work on assignments across different businesses.
Culturally, GE is also becoming more like large tech firms, with casual dress growing more common and Jack Welch’s philosophies ending.
- “Business Development” (Corporate Development) Has Been Decentralized – Each division now has a corporate development team; as a result, FMPs can potentially gain some deal experience.
The likelihood is still low, but if you network aggressively, it is possible. In the past, it would have been nearly impossible to do a rotation in this area.
- Recruiting and Interviews are Less Technical – There are no assessment centers in the U.S., there are no real technical questions in interviews, and it’s more feasible to get into the program from a non-finance background.
These changes have altered the usual exit opportunities, but the daily tasks of FMPs have changed the most.
Q: OK, thanks for that overview. Can you walk us through your story now?
A: I went to a traditional “target school,” majored in history, and only became interested in accounting and finance in my junior year.
I had started a small business in high school and thought that accounting and finance would be useful supplemental skills.
But when I began taking classes in those areas, I was drawn to the industry and decided I wanted to work there.
I interned at a Big 4 firm and an energy company before accepting a full-time offer in the GE Financial Management Program (FMP).
Q: I like your brevity.
What types of candidates is GE seeking for FMP roles?
A: The main points are:
- University: GE now has ~15 “target schools” in the U.S., including state schools such as Penn State and private schools such as Notre Dame. If you’re not at one of these schools, you’ll have to network extensively to get in.
- Major: They don’t care about your major; Finance, Biology, and English majors get in.
- GPA: The minimum GPA is 3.0. I’ve seen people with GPAs of 3.1 up through 3.8 get in.
- Work Experience: They don’t care about your specific experience in the same way investment banks do; I’ve seen people with scientific research and marketing backgrounds get in.
You just have to spin your experience to justify your interest in finance, the FMP, GE, and industrial businesses.
Q: OK. So, how do you spin your experience to do that?
A: Here are a few examples:
Example #1: You did molecular biology research and developed your analytical/quantitative skills from that.
You liked making an impact on the world in healthcare, but you’re more interested in the operations of a group such as GE Healthcare that helps doctors change lives.
Example #2: You liked the team-oriented work environment of a marketing agency, but now you’re interested in working for some of your previous clients at that agency.
You find it more interesting to build tangible products than to design advertising campaigns.
Example #3: You worked in private equity and enjoyed building models and evaluating deals, but you felt detached from the action of running a business.
You want to work inside a company and affect its operations rather than just monitoring companies.
Q: Thanks for those examples.
What’s the recruitment process like?
A: You start by attending an on-campus event, applying online, or networking with FMPs.
If you’re selected for an interview, the first round will be a phone screen.
If you do well, you’ll move onto the in-person round, which usually consists of three 30-minute interviews.
If you do well in those, you’ll advance to the Superday, which is a centralized event. GE flies all the Superday candidates from that round (around 70-80 people) to the headquarters of one business division.
You’ll meet the FMPs and program coordinators for dinner, and you’ll go through three more 30-minute interviews the next day: One with HR, one “panel interview” with FMP coordinators, and one with a finance executive.
After that, you’ll be shown around a GE “Career Fair” where FMP Coordinators pitch their businesses.
Then, you’ll hear a few speeches from the finance executives, go to lunch, and head back to the airport.
There are no technical questions in any of these interviews.
They ask only the standard behavioral questions (“Why GE?” “Why FMP?” “What are our core values, and how have you demonstrated them in the past?”) because they want to “teach you finance the GE way.”
A Day in the Life of an FMP
Q: That’s good to know… no need to memorize 52,723 technical questions.
What’s an average day as an FMP like?
A: It depends on the division and rotation, but here’s an example of an “average day” from my time in a Commercial Finance rotation:
- 7:45 AM: Arrive and prepare for an 8 AM call with the “Commercial Team” (sales).
- 8:00 AM – 9:30 AM: I’m on the phone with different Commercial Teams in different time zones compiling the sales figures from last week. I do the math and realize that the sales guys are missing their targets, and the margin is increasing.
- 9:30 AM – 11:00 AM: I dive deeper into Excel to adjust the sales estimates for the quarter.
- 11:00 AM – 11:30 AM: I pretend to look busy and count the minutes until lunch.
- 11:30 AM – 12:00 PM: Lunch with three other FMPs on the floor.
- 12:00 PM – 3:30 PM: I sit in on meetings; they range from assisting the commercial accounting team with revenue recognition to helping the commercial operations team with their funnel analytics.
- 3:30 PM – 4:30 PM: I have an FMP roundtable with the Global Head of FP&A and all other FMPs to learn more about the business from a senior executive’s perspective.
- 4:30 PM – 5:30 PM: My boss asks me to input manual journal entries for a product.
- 5:30 PM – 6:00 PM: I attend an FMP committee meeting where they start planning a big Philanthropy event in the fall.
- 6:00 PM – 7:30 PM: Happy hour with the FMPs and OLMPs (Operations Management Leadership Program, another rotational program at GE).
Q: How representative is that day? It sounds like a lot of meetings.
A: The days vary a lot; sometimes I spend 90% of my time in Excel working to automate a process and analyze data.
On other days, I could be in meetings or on calls the entire time.
On average, I spend 60% of my time working with data and 40% working with people.
But the cross-functional work varies a lot: In the Commercial Finance example above, I worked with Controllership, Sales, Supply Chain, and Finance team members.
But in a Supply Chain rotation, you might interact with lead engineers and sourcing executives.
And if you’re in a Controllership rotation, you might interact with only the Controllership team members for the whole rotation.
Q: On that note, what are the different rotations, and what do you do in each one?
A: Each FMP is now required to complete one rotation in Commercial Finance, one in Supply Chain Finance, and one in Financial Planning & Analysis (FP&A). After that, the FMP can choose one of those three for his/her fourth rotation.
The program lasts for two years, so each rotation is about six months.
In each rotation, FMPs join small teams dedicated to managing P&Ls across the business and complete many of the same tasks as full-time team members.
The daily tasks are similar in all each rotation, but the long-term projects vary a lot.
Here’s an overview:
In this rotation, you support the Sales team, as well as the Controllership and Supply Chain teams.
You estimate quarterly sales and cost figures for different products, track customer deal structures, analyze “the funnel” to see where sales are coming from, and manually adjust journal entries to close the books each quarter.
As an FMP, you’ll spend a lot of time automating tasks (in Excel) and creating dashboards (in Spotfire) to summarize data. The goal is to build tools and processes so that “you leave the role better than how you found it.”
Older and less-tech-savvy employees execute many tasks across the business, so there is a lot of room for automation and process improvement.
Commercial Finance roles are often the most desirable ones because you’re closer to the front line of sales, so you gain customer exposure and feel more responsible for growth.
Supply Chain Finance
In this rotation, you focus on reducing costs instead of increasing revenue.
For example, you look for cost-cutting opportunities in plants, factories, and the sourcing and logistics processes.
To do that, you track product costs, liquidations, plant productivity, and labor productivity, and you use the numbers to make recommendations.
For example, you might gather data on raw material prices from different suppliers, observe negotiations with one vendor, see how the final price affects the ledger, and then argue for a different vendor or deal structure that might improve the financial results.
You still spend time closing the books each quarter, creating dashboards, and explaining budget variances, but you focus on expenses rather than revenue.
Financial Planning & Analysis (FP&A)
In FP&A, you forecast the division’s entire P&L. That makes it different from Commercial Finance because you focus on sales there.
A big part of this rotation is story-telling.
For example, one year, GE Healthcare’s cash reserves decreased significantly.
Someone in the Healthcare FP&A team had to take the data, account for the variance between the budgeted and actual P&L, and then explain how the division could generate more cash by the end of the year.
You’ll still spend time on weekly calls, journal entries, and dashboards, but you focus on the entire P&L and telling a story around it.
Your long-term projects might include the simplification of reporting or standardizing key metrics across the P&L, and you interact closely with the group CFO.
That’s significant because CFOs act as COOs at GE: Operational leaders report to the CFOs of each region and modality, which gives the FMPs more operational exposure as well.
Q: Thanks for that detailed comparison.
What are your long-term plans?
A: I want to get into investment banking and then move into private equity.
I’ve enjoyed working at GE and wouldn’t mind returning in the future, but I want to work on deals rather than day-to-day tasks.
Q: Good luck!
How easy is it to get into IB from this program, though?
A: It’s difficult and quite rare. I’d say 95% of FMPs either:
- Accept full-time positions at GE in one of the areas above after the program ends; or
- Enter the next leadership program, which is called “Corporate Audit Staff” (CAS). It entails internal audit work around the world, with a new rotation every four months.
Most FMPs follow this path because GE has a great culture, and they want to maintain some semblance of work/life balance as well.
If you have attended a target school and you’re willing to network aggressively, it’s possible to get into IB, consulting, or Big 4 TS/TAS, but few FMPs do it.
The program is great if you want to stay at GE and become a divisional CFO, or if you want to advance within corporate finance at other large companies.
You can still use an FMP role to move into other career paths, but it’s a longer road because you might have to work for 3-4 years, attend a top MBA program, and then recruit for consulting or banking roles.
Q: Thanks for clarifying that. Can you give us a rough idea of the compensation as well?
A: Sure. Entry-level FMPs earn between $60K and $70K USD and advance to $100K within five years and $200K within ten years – if they stay in finance, do well, and get their superiors to like them.
It’s nothing like the compensation progression in IB/PE, but the hours and lifestyle are also far better.
(NOTE: Compensation based on 2017 figures.)
Q: Thanks for adding that.
Thinking about everything we’ve discussed, who would be a good fit for the GE FMP, and who would not be a good fit?
A: To be a great fit, leadership and teamwork are essential since you interact across the entire company – far more so than in IB/PE-type roles. That’s one reason the company often prefers athletes for the program.
You have to be comfortable diving into detailed analytical work, training newcomers, and assisting other FMPs.
Also, you have to be comfortable moving to the middle of nowhere (e.g., Erie, Pennsylvania or a small town an hour outside of Phoenix) and living there while performing a fair amount of grunt work.
You’re expected to accept these circumstances because you also get a lot of exposure to senior executives and great technical training.
You’d be a poor fit if you’re 100% certain you want to live and work in New York or another major city, or if you prefer to work alone and feel annoyed when others ask for your help.
For example, if someone asks you for help with an IT or accounting problem, and you get annoyed because it seems trivial to you, you will have a tough time maintaining your sanity in this role.
Q: Great. Thanks for that summary, and for your time!
A: My pleasure.
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