"Andrew Gabriel" wrote in message
...
In article ,
"Brian Reay" writes:
Actually, Weinstock was pretty good at recognising "core business" and
turning a profit.
It was quite simple. As one of Weinstock's companies, you could
borrow money from him if you could show him you would give him
a better return on investment than he would get investing it
elsewhere. He sat on a £1B pot which he used for this purpose.
Only thing was, the return had to be within a year -- it was very
difficult to borrow money for development over a longer period.
But similar arrangements are common- sometimes, for example, business units
are allowed to return less margin to the central pot, holding some back to
fund development etc.
Investment has to be funded somehow and I don't thing GEC were really any
worse than other major UK companies for this. It seems a UK trait to look
for a quick return and not look at the long, or even medium, turn.
Weinstock was shrewd, successful, and turned a profit. Dirty words to
some
people but he presided over an empire that kept many people in gainful
employ for many years.
He spent years training his son to take over from him. His son
died of cancer before he got to the point of taking over.
Yes, I wonder how different this would have been if Simon hadn't died.
I left
GEC at that point, but my recollection is someone from Lucus was
brough in to run the company, and the £1B cash mountain turned
into a multi-£B hole in a remarkably short period of time. As
you say, the company decided to get rid of all it's non-telecoms
businesses (i.e. the opposite of the diversification Weinstock
presided over) just in the lead up to the dot com crash. I never
really understood this move as it also coincided with GEC having
saturated the BT network (i.e. no more System X as all exchanges
were now moderised), and having substantially failed to find any
other large market for System X in the world, it seemed to me
that the telecoms bit was heading for big trouble even if the
dot com crash hadn't happened.
I don't recall where the replacement came from but, if it was Lucas, I also
don't think they were exactly thriving then.
The bad news is, worse is to come. The UK energy policy is wrecked, in
the
late 70s everyone said "no problem, we've 300 years of coal". So research
was abandoned, the coal mines closed, the gas used more quickly, and we
are
on the point of being totally dependant on foreign energy. In a master
stroke, Blair does a deal with the French (long known for their generous
support of the UK) to manage an alternative.
I wrote an article on this just recently from the point of view
of future lack of security of UK energy supplies...
http://groups.google.com/group/uk.d-...f46f4fa4a9973c
Bad news is, I doubt anyone with the power to change things will bother to
read it. Sadly we in the UK tolerate our standard of living been screwed up
by poor government and we are too apathetic to do anything about it.
climbing off soap box
Brian