“If I had to run a company on three measures, those measures would be customer satisfaction, employee satisfaction and cash flow.”
Jack Welch, former CEO of GE.
(Quote taken from my notes of his keynote interview at European Customer Management World in London).
Poor Jeff Immelt. Despite better than expected earnings by Wallstreet, General Electric’s first quarter still sank by one third, weighed down mainly by its GE Capital unit, but also due to weak performance by some of its heavy industrial divisions. Seen as a general indicator of the U.S. economy’s performance (the results of its wide-ranging product line) GE still has a mountain to climb if it ever hopes to regain its former prominence.
How things have changed since former CEO Jack Welch retired from GE in 2001 after 20 years at the helm.
One of the first things Jack Welch did as a 24-year-old manager of a GE plant was blow up the part of the plant he was responsible for.
The head of the plant called him to his office to explain.
Welch, assuming this was the end of his managerial career, duly explained that he was experimenting with a different mixture from the standard one and it had caused an explosion. The plant boss probed further, asking him why and what he had hoped to achieve.
Satisfied that Welch had
a) learnt a lesson from the experiment and
Nick McCormick's post on 'Unmanagement' got me thinking that there is a popular view of Jack Welch as a domineering, strong-willed leader who imposed himself on GE and shaped it in his often ruthless image, with a 'shape up or ship out' culture. "Well, up to a point, Lord Copper", as the lead character in the book Scoop always says to his boss when he's afraid to contradict him. There are different incarnations of Welch, depending on which period of his 20 year career at the top of GE you look at.
A large number of credible commentators call him the most successful CEO of modern times. He turned Edison's company, General Electric, from a $13 billion to a $400+ billion turnover company. His gruff way of expressing himself and his early reputation as 'Neutron Jack' when he began leading GE by slashing jobs ('Neutron' as in the bomb that kills people but leaves buildings standing), plus GE's performance development structure of 'culling' the bottom 10% of performers, has meant people think of Welch as the archetypal tough guy, take no prisoners, ruthless leader.
by Jim Taggart
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