Career Lessons from Kathleen McCarthy: Managing a Crisis

As CHRO for GE Digital, Kathleen McCarthy drew on her crisis management experience to help reshape the struggling company and lead it through the coronavirus pandemic.

By Novid Parsi May 28, 2020
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Kathleen McCarthy

​Kathleen McCarthy thought she was going to die. She remembers thinking, “Did I really make this stupid choice to come on this sailing trip when I was so ill-prepared emotionally and technically?”

Acting quickly, the crew cobbled together a makeshift wheel and plugged the gap. As harrowing as the experience was, McCarthy now calls it “the best adventure in the whole world.”

Now the CHRO at GE Digital, based in San Ramon, Calif., McCarthy says that experience was “one of the biggest lessons of my life. It truly changed me.” Before then, McCarthy says, she had not been very serious about her life or career. Afterward, she focused intently on both. “I then had a perspective on what really matters and what I want to do,” she explains. “That was the moment in time when I became, professionally, a different person.”

McCarthy’s sailing incident also gave her an early experience in managing and surviving a crisis. That’s a skill she has often had to tap. The September 11 terrorist attacks took place while she worked at Thomson Reuters in New York City—across the street from the World Trade Center. The 2008 economic crisis happened while McCarthy worked in the financial services industry at American Express. And most recently, as CHRO at GE Digital, she, like every HR leader, has been contending with the COVID-19 pandemic. Founded by GE in 2015, GE Digital provides software solutions such as predictive analytics and automation to utility, power generation, oil and gas, and manufacturing companies.

“I would say I’m truly pressure-tested at this point,” McCar­thy says. “I’ve had to rise to the challenge of being a leader in uncertain times.”

Crisis Communications 

As the pandemic rapidly upended the status quo this spring, McCarthy and her team had to communicate with employees in 31 countries—helping them get set up to work remotely and creating a site to share regular updates about the pandemic. The team also adapted its staff survey to assess how the pandemic was affecting employees and their well-being, how they were serving their customers in a time of need, and how they were preserving the strength of the business. 

“Our first priority has been the safety of our employees and their families and our communities,” says McCarthy, who was promoted to CHRO in January 2019 after serving as GE Digital’s senior executive in global talent management and organization design.

She saw the importance of crisis communications after September 11. “Our employees were incredibly afraid for themselves and their families,” she recalls. “We communicated as much and as quickly as we could.” McCarthy feels she emerged from that experience with an ability to lead during a crisis. “Part of me knows I survived 9/11 and I can now remain calm and steady and help others who’ve never gone through events like this,” she says.

Well before the pandemic struck, GE Digital faced a different type of crisis. The struggling company was looking to change most of its leadership team, and McCarthy had to put her leadership skills to work. She even had to search for her new boss: CEO Patrick Byrne joined the organization last July. On top of that, she had to bring on other new leaders and let go of existing executives, all while folding other GE businesses into GE Digital and transitioning to lean business principles. And she had to accomplish it all in a matter of months.

People with a Purpose

In assembling GE Digital’s leadership team, McCarthy says she looked for people skilled in the company’s tech and software offerings but also in its customers’ industrial domains: electricity, oil and gas, and manufacturing. “When we went out to our customers and talked about what differentiated GE Digital, they always said, ‘You know my business. You understand the sector we’re in,’ ” McCarthy says. So she knew the new leadership team had to have both sets of expertise. “We’re not just a fast-paced software business,” she says. “We also have to understand in detail how our customers’ domains, tools and systems actually work.”

McCarthy has found that the new hires were drawn to the company because they could use their technical prowess to solve real-world problems. “We save people’s lives through ventilators we build, [and] we keep planes flying with our engines,” she says. “Folks with deep experience in technology love coming into an organization with assets that you can see and aren’t just in a cloud.”

When hiring, she also looks for candidates with soft skills. “I look for people I can work with over a long period of time,” she says. That involves considering questions such as “Will they be selfless in helping to solve complex business problems? Can they sit around a leadership table and have the right debate and dialogue? Are they good listeners?” Those questions, she says, point to the individual’s authenticity.

‘If you’re going to get good at your job, it’s about creating authentic, trusted relationships.’

“Authentic” is how GE Digital’s Samira Kaderali Lowman describes McCarthy. “What you see is what you get,” says the company’s head of organization and talent development, who has worked with McCarthy since her Thomson Reuters days. 

That quality proved essential during the company’s recent leadership transitions, Kaderali Lowman says. “Kathleen had to build a new executive team while exiting some executives who had been with GE Digital for a while but weren’t part of the new vision,” she explains. “She did all that with transparency and with grace, and she navigated a complex situation in a way that helped the organization through that difficult time.”

The Importance of Partnership

McCarthy’s new boss agrees: “She’s been a very active leader in forming the new GE Digital and building its leadership team,” Byrne says. “She’s a business partner with a keen business mind.”

Partnership is at the core of McCarthy’s leadership philosophy: “You cannot do it alone,” she says. At GE Digital, she has had to work closely with the leadership team, the communications team and, of course, her own HR team. McCarthy says her most valuable career lesson has been the importance of partnership—whether that’s in helping an organization weather change or helping a sailboat weather a storm.

“If you’re going to get good at your job, it’s about creating authentic, trusted relationships,” she says. 

That early-career lesson began to take root when she started working at Boston-based consulting firm Bain & Co. in learning and development and later recruitment. McCarthy knew right away that she had found the right career. “I fell in love with it, and then I was never letting it go,” she says. McCarthy sums up HR’s appeal for her in one word: people. She realized, “I could change someone’s career and life.”

After a recruiting stint at McKinsey in the late 1990s, she moved to Thomson Reuters, where she worked as the global head of talent management and acquisition, and then American Express, where she became the chief talent officer. The shift from recruitment to broader talent management was a “huge move,” she says, because it forced her to develop a wider understanding of the needs of a business and its market. 

“I had to think more holistically about someone’s career versus just thinking about getting them in the door,” McCarthy says. “That pushed me to own what happens after that person comes through the door—how they’re most productive and engaged.”

While McCarthy has a strong sense of the primary challenges facing the HR industry over the next decade—constantly changing technology, a workforce that blends both people and automation, and a demographic shift to a generation that wants more flexible and project-based work—she feels less sure about what the COVID-19 pandemic could mean in the more immediate future. “It’s going to take a while to come out of where we’re at right now,” she says.

Not every business challenge is as disruptive as a pandemic or terrorist attack, but every company will encounter difficult times, McCarthy says. It’s the HR leader’s job to manage those challenges, she adds, while also conducting talent reviews, developing employees and otherwise keeping the organization running. “You’ve got to keep the business moving forward,” she says.

McCarthy draws on another lesson forged in the heat of crisis to manage today’s precarious climate. She was scheduled to get married the weekend after September 11, her parents insisted the wedding take place as planned, and the happy event infused an awful time with a sense of hope, McCarthy recalls. 

“That’s part of what I do in today’s situation,” she says. “Be there and give hope.”  

Novid Parsi is a freelance writer based in St. Louis.

Photography by Nina Pomeroy

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