The Great Leader Series No. 9 - Jack Welch

Great Leaders – Do They “Walk The Talk” ?

Thoughts on Jack Welch’s leadership from one of his ex-employees

As with all great leaders, there are dozens of books available on Jack Welch – either by him or about him. Those written by him help the reader to understand the rationale behind his decisions and to see what was behind his various management initiatives. Those about him analyse how he strove to move forward the giant that was General Electric. But the only way of knowing if Jack Welch “walked the talk” is to have worked in Jack’s company whilst he was in charge. Did he practice what he preached ? Was he truly a great leader ?

Let us examine five of Welch’s leadership secrets in turn :-

1. Lead – don’t manage

Welch argued that leaders should not be spending their time by managing every excruciating detail, leaders should articulate a vision and then energize others to execute it. I contend that this was Welch’s greatest achievement.
Welch never pretended that all his ideas were original but he was very adept in fine-tuning the ideas of others and then conveying a very simple message. He strongly urged the recruitment of outstanding individuals, so he never had to worry about implementation – he had a wonderful record of inspiring teams to deliver his vision.

2. Make intellect rule – not hierarchy

Welch said that business is all about capturing intellect and that leaders must encourage people to articulate ideas.
The “workout” sessions which Welch initiated were not a new idea but his enthusiasm for the concept ensured that every unit at every level of GE embraced it fully. These sessions were very prolific in producing lots of low-level ideas and his people were encouraged to challenge the status quo. There was however an overwhelming focus within GE on delivering Jack’s latest edict. Welch was not afraid to dispense with people, plants or entire businesses – especially in his earlier years at GE. Despite his admirable teachings, the fact that he was very obviously “the boss” usually determined which ideas were given priority.

3. See change as a never-ending opportunity

Welch encouraged his teams to expect change and to stay one step ahead of the competition. He often amazed his staff and his competitors by changing things whilst still in a winning position. He constantly urged his people to reinvigorate the business.
This sometimes created an atmosphere within GE of always trying to hit a moving target – hardly any junior or middle managers did the same job for more than 2 years, which could affect relationship-building. Customers outside the USA often found the constant merry-go-round of people and ideas to be somewhat disturbing.
Obviously GE became a moving target for its competitors and that made GE harder to hit !

4. Quality is your job, not someone else’s

Welch encouraged everyone to think “Quality” and to take great pride in all aspects of the job. One of his spectacular achievements was in changing GE to a “Six Sigma” culture – a complete re-vamp of the company’s thinking so that everyone became aware of quality issues and how constant improvements must be made.
This made everyone understand what the customer was feeling, and it also vastly increased the number of decisions which were data-based. However, there were times when Six Sigma also got in the way of quick, smart, commercial decision-making and introduced a mountain of charts, buzzwords and intellectual snobbery. Whether the claimed savings would have happened without Six Sigma was open to debate – except that all questioning of Six Sigma’s viability was discouraged, and hence decidedly career-limiting within GE.

5. Set stretch goals

Welch wanted all his people to reach for the unreachable – which was his way of asking his teams never to accept that a goal is impossible to achieve. Welch taught an entire generation of GE managers never to accept mediocrity.
This is an excellent philosophy – however, what it meant in practice was that whatever budget was agreed, it would invariably be stretched. So everyone bid low, knowing they would be forced higher. Welch also insisted that no-one should be punished for failing to hit a stretch goal. In reality, your days were numbered if you missed more than one !

So – did Jack Welch walk the talk ?

It is fair to say that Welch practised pretty much what he preached – most of his ideas were so darned simple that every team member could quickly understand how they could contribute to their successful execution. He no doubt believed that the implementation of his ideas was due to his vision, his charisma, his enthusiasm – and these qualities were certainly the most important factors. But like most great bosses, Jack could be ruthless and the fear factor cannot be ignored.

And has he been a truly great leader ?

Welch was enormously successful in moving the giant GE onto another level, by whatever measure you choose to use. He took a successful company and transformed it into one of the world’s most admired organisations. He succeeded in getting huge numbers of very capable people all pulling in the same very profitable direction.
Welch’s staff were inspired by him and they were certainly glad he was captaining their side. Whether they liked him or not, they respected him, they admired him and they followed him.

Mike Stokes spent the last 12 years of Jack Welch’s tenure as CEO of General Electric beavering away at the commercial coal-face of GE’s appliance business, faithfully helping to implement Jack’s latest edict. He was once interviewed for a job by Welch’s successor, Jeff Immelt, though it is perhaps unlikely that the latter remembers the event !  Mike now runs his own export consultancy business and can be contacted on 01733 211873, or via website www.exportential.co.uk

Date : 26-01-2007