John Flannery, the new CEO of GE, announced a series of decisions to roll back the scope of the company. Growing companies often diversify, but GE is doing the opposite, which is an act of downscoping. Is that a good idea for GE in the long term? In the short term, the market has punished GE for this decision.

In its first two sentences, the article referred to a "conglomerate-style empire" and the "conglomerate era" as artifacts of GE's past. In 1999, a favorable article in the Economist had praised then CEO Jack Welch for this very strategy. It is quite astonishing to see how Welch transformed it into a finance company, a decision that GE has paid dearly for since 2008.

Please use this discussion to evaluate Flannery's decision.