Needless to introduce a person of the stature of Jack Welch, but certainly, there is a need to share the contributions of his leadership and versatility to the organization, General Electric Corp. Jack Welch transformed a $13 bn company into a $280 bn multinational conglomerate by the dint of his unique leadership traits. This case discusses the leadership qualities of Jack Welch that made him the world's most admired CEO, who made General Electric the most admired corporate.
Dr. John H Welch, better known as Jack Welch, was the Chairman of the General Electric
Corp. from 1981 to 2000. Jack was adjudged as the most admired CEO in US by the
Fortune. In an Industry Week survey, his peers rated him the most admired CEO three
times in four years. In two decades of his Chairmanship, Jack elevated the market value
of GE from US$13 bn in 1981 to a US$280 bn in 2001 by the dint of his leadership qualities
(Exhibit 1) and innovative strategies. Under his leadership, GE delivered more wealth to
shareholders than any other company. Value Based Management said “Whatever his
tactics, the fact that Welch is one of the most successful business leaders of all-time
is indisputable. He has swelled the market value of the company to a degree unmatched
by any other CEO, an accomplishment not even Bill Gates, Michael D Eisner or Warren
Buffett could lay claim to”. GE was the only company in which Jack Welch worked for
his entire life. Jack started his career at GE in the year 1960 as an engineer. During
his tenure at GE, Jack Welch evolved into an icon of efficient management and successful
leadership of a company through his unique and exceptional strategies. He proved to
be a transformational leader1 by transforming General Electric Corp. from an industry and
manufacturing oriented firm to a service organization with its operations spread.
Jack’s beginning at the GE was not very smooth. He had a few problems in the initial
years at GE. He found that the organization was filled with bureaucracy9. Jack was also
not happy with his first performance appraisal. He was given the same increment in salary
as everyone else, though his performance was better. He felt thoroughly demotivated and
decided to quit. However, destiny had something else in store for him, his superior’s
superior, Ruben Gutoff, stopped him offering a higher pay. Gutoff shared his agony over
the bureaucracy and assured Jack of better prospects in the organization. This
differentiation was one of the most important management lessons that Jack learnt early.
In life, he believed that winning teams come from differentiating and rewarding the best
performers and weeding out the worst performers. |
