Lorenzo Simonelli, CEO of Baker Hughes on driving change through uncertainty

Many CEOs gravitate towards building their team with similar, like-minded people. However, the most successful teams are more diverse, bringing a wide variety of knowledge, skills and expertise to the organization. Managing ambiguity, managing change, and having a team around you who will contradict or challenge you is very important. If you’re going to make the best decisions, it’s necessary to have the global cultures and diversity of thought exhibited in your team.

What you’re doing is actually connecting the dots, connecting the aspects of bringing people together, being able to make decisions, and being able to drive forward.”

For episode # 54 of my podcast series, The World Class Leaders Show, I was honored to interview Lorenzo Simonelli, the Chairman and CEO of Baker Hughes, an energy technology company that combines innovation, expertise and scale to provide solutions for energy industrial customers worldwide. 

Previously, Simonelli served as President and CEO of GE Transportation where, as one of the youngest division chiefs in GE History, he expanded and diversified GE Transportation by focusing on advanced technology manufacturing, intelligent control systems, and a diverse approach to new propulsion solutions.

A CEO’s Journey

While Lorenzo Simonelli’s initial career focus was on finance, it was clear that he could leverage those number-oriented skills towards providing operational leadership as well, with support from a strong, diverse, and complementary team.

“It’s not just about producing the numbers, it’s how you produce the numbers.”

Relying on his own key attributes and strengths as a foundation, Simonelli built his executive team to include multiple skill sets in technology, operations and commercial aspects. This approach generated resources for managing the ambiguity and consistent change that are hallmarks of today’s business environment.

Evolving an Organization

Standing still is not an option, and change is constant. As the world is evolving, organizations must also evolve with the times.

Bureaucracy has a hard effect on organizations. Combatting bureaucracy begins with clarity of strategy. Once an organization’s leaders formulate and articulate a clear strategy, then it’s necessary to create a company culture that fosters the development of behavior to execute it.

Changing culture is more challenging because it means altering the behaviors and thought patterns of individuals who have worked in the same way for many years. 

Changing Culture

Addressing cultural change starts with a clear and decisive leader who can articulate the direction of the organization. Every organization observes its leader closely, judging and perhaps duplicating their actions. The leader must be a role model; someone who can be seen to exhibit the right behavior at all times. The leader must be the first to collaborate and the first to signal when it may be time for an individual to leave the organization if the fit is not right.

It takes time and may require multiple phases over many years. That means the leader must be steadfast in modeling the right behaviors, as well as constantly anticipating and pivoting when necessary. An important aspect is to ‘fail fast’, learn quickly, and continue to move forward along the trajectory of the strategy that has been laid out.

Perfecting Communication in the Modern Age

It’s much more complex today than it was previously. The explosion of channels — news, email, social networks and so on — delivers a constant stream of information coming to individuals. This is why clarity and simplicity of strategy and message become so critical, in order to reach and impact diverse groups within and across organizations.

An effective leader will safeguard the future of the company by empowering the operating teams and providing support for the future direction. The role of the CEO is to set direction, be the cheerleader, anticipate changes, and then also make the right choices for people. If a CEO is too busy working in business operations, they run the risk of forgetting the bigger picture and mission.

People tend to assume that the CEO is always going from place to place and interacting and socializing, or in meetings making decisions. One of the key resources for a CEO is having quiet time to focus and think through the broader aspects of what’s happening to the company through the lens of the different stakeholders.

Seven Attributes of a Successful CEO

  • Strong self-confidence – relies on key attributes and strengths
  • Builds a diverse team that can challenge or support as needed
  • Decisive, while willing to solicit and accept feedback from all constituents
  • Ability to navigate ambiguity and constant change
  • Models the desired behaviors required for cultural change
  • Clear and effective communicator
  • Remains focused on the big picture

To close the interview, I asked Lorenzo to share with us his responses to my top guest questions.

Q: Could you share with us the most important thing you’ve learned in your career?

I’ll give you two, because I think they’re both very important. The first step is, no matter how confident you are and how good you are, as an individual contributor you cannot do everything. You need a team that is with you, supporting you and aligned with you, yet at the same time willing to challenge you. The second is, the amount and pace of change that I’ve seen in the last decades around the world is staggering. So, pivoting and being able to learn fast, fail fast and adapt is very critical.

Q: Is there anything in your career that you might have done differently?

When I think of that question, I always remind myself, it’s important to go forward, not backward. And so no, I wouldn’t change anything. I’ve been very fortunate. I’ve learned along the way. And I think, you know, it’s always important as a leader, to continue to move forward and address the opportunities ahead.

Q: Is there a single book that had a major impact on your professional life?

When I think of a book, I go to the reading that led me to a better appreciation of the energy industry and also the importance of energy. It’s a book by Dan Yergin, “The Prize”, which gives a sense of how important and influential the energy ecosystem is.

For more information regarding Lorenzo Simonelli and his work, you can visit the company website https://www.bakerhughes.com/. You may also wish to reach out on Linkedin, at linkedin.com/in/lorenzo-simonelli.

If you’ve enjoyed this or other of my podcast episodes, please send me any comments via LinkedIn at linkedin.com/in/andreapetrone, or via email at [email protected].

For more information on my work and access to other valuable resources, please visit the website, at https://www.andreapetrone.com/.

Listen to the podcast related to this article:  https://www.andreapetrone.com/lorenzo-simonelli-ceo-of-baker-hughes-on-driving-change-through-uncertainty-podcast/

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