George David rose from elevator executive to the pinnacle of Connecticut's largest private employer, United Technologies Corp., which he has presided over since the early 1990s. It's been a great ride for him and UTC's investors, though a bumpier one for the workforce and the state.
The brainy, driven titan of industry will retire as chairman of the board of UTC by Jan. 1. (He stepped down as CEO in 2008.) He's vastly expanded the corporation's global footprint. He's delighted shareholders with phenomenal profits of 860 percent in his 14 years as CEO. He's been rewarded in turn with hundreds of millions in compensation.
But Mr. David never made Connecticut feel quite secure in their relationship.
UTC's Pratt & Whitney had been the state's No.1 employer for a half-century when Mr. David and colleagues suggested the unthinkable in 1993 — moving thousands of Pratt jobs out of Connecticut unless the company's costs were lowered. That move was quickly averted with state tax credits and union concessions.
Nevertheless, UTC has whittled its Connecticut workforce from 47,000 in early 1992 (25 percent of its global employees) to 26,000 today (12 percent of its worldwide workforce).
The Hartford Financial Services Group, in contrast, has 40 percent of its global workforce based in Connecticut. Another 1,000 UTC jobs will move from Connecticut to the South and to Asia next year unless the machinists union prevails in its lawsuit to block the move. Connecticut's high costs continue to be a sore point with the corporation.
Though Mr. David leaves behind a leaner local operation than he inherited, it's also far more efficient. Early in his career, his passion for the details of production led him to hire a Japanese management guru to come up with a simple quality-control method that is now ingrained in UTC culture.
The son of one of the first Rhodes scholars, he placed a premium on education, letting employees pursue degrees on company time and at company expense — even if they'd been laid off. The Employee Scholar Program has had 26,533 graduates since 1996; 15,197 employees are now enrolled, according to the UTC website. It's a huge, unusual and enlightened investment for a company, and one of Mr. David's greatest legacies.
Another legacy is a very profitable company. While shedding jobs in Connecticut, Mr. David expanded UTC worldwide, growing the company from 168,600 employees in 1993 to 223,100 now. He routinely delivered double-digit earnings growth. In 2004, BusinessWeek said he "outperformed even the mythic General Electric Co. in returns to investors."
He was outdone by GE, however, on a bid to acquire Honeywell that would have doubled UTC's aerospace business. Ultimately, the European Commission blocked the deal.
UTC's Next Steps
A more personal merger ended badly this year with Mr. David's very public divorce from a Swedish countess. A few other things have not gone his way, including Sikorsky's loss of the contract for Marine 1 helicopters in 2005 after almost a half-century of ferrying the president around.
But the unflappable Mr. David takes the long view. UTC was an early investor in fuel cells, pioneering them for the Apollo space program.
Now the manufacturer has helped make Connecticut the world center for this new technology. The company is installing a fuel cell at the Connecticut Science Center — the first museum or science center to get most of its power from this alternative energy source.
Mr. David is leaving Connecticut a stronger, though skinnier, UTC in the hands of his capable successor, Louis Chenevert. May it thrive here — and grow — for many more decades and continue to push the state to get its own costs under control.
Reprinted with permission of the Hartford Courant.
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