Discussion of Jack Welch's Leadership

Discussion of Jack Welch's Leadership

Jack Welch's tenure as GE's CEO was hugely successful – he grew GE from a large well-known company to the largest and most admired diversified corporation in the world – creating a corporate culture firmly rooted in change and rewarding employees and shareholders who stayed on for the ride. As a former GE employee (GE Financial Assurance 2000 thru 2004 and currently with Genworth Financial – a spin-off from GE), I have experienced the GE culture and have personal observations on the many pros and few cons of Mr. Welch's legacy.

#1 or #2: Fix, Sell, or Close: The idea of only focusing on businesses where you could compete at the top was a great idea. Event though GE had a large number of businesses, this concept allowed GE to focus on business where it could get the biggest return for their investment. There was a human capital cost as staff was reduced for businesses that were exited. Mr. Welch was also able to apply this concept to GE's global businesses – which solidified this change in culture to ensure that GE focused on being number one or two from a world market perspective in any business that they were in – over time international sales grew to be greater than domestic sales.

Work-Out and Best Practices: Mr. Welch's goal was to create a culture based on "speed, simplicity, and self-confidence." To create this desired culture Mr. Welch introduced two-major change initiatives termed "Work-Out" and "Best-Practices." "Work-Out" was a process in which employees and their managers could discuss and determine new ways of removing unnecessary bureaucratic work from their processes and determining ways to work together better. "Best Practices" are concepts to focus on developing the most effective processes versus an individualistic approach. This was a brilliant idea of Mr. Welch. In my experiences at GE Financial, these concepts brought out the best in employee performance and increased productivity and innovation.

Developing Leaders: I admire Mr. Welch's dedication and approach to developing leaders and employees at all levels. The rewards and recognition system that GE used of ranking employees one thru