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Focus On: A Conversation with
Jack Welch
Former CEO of GE Advocates Responsible
Business, Valuing People
When Jack Welch joined dean Edward A. Snyder and
deputy dean Ann McGill for a conversation in Hyde Park in October,
Welch shared his experience leading General Electric as well as
his thoughts on leadership, social responsibility, and success.
Excerpts of that discussion follow.
On Humanizing Bureaucracy
In
a bureaucracy, the key is to make it informal. Business was built
in the ’60s and ’70s as a bureaucracy—military-industrial
company with a general called a CEO hanging over people. And I
think the idea of unleashing people and having people be themselves
at all times, and getting bureaucracy off their back, is an enormous
competitive advantage.
You’ve got to let people know they count—that
regardless of the stripes on their shoulder, their ideas count.
It’s the quality of their ideas and not their height in the
organization. And that’s hard to do in a bureaucracy. You
have to prove it to people a thousand times, because they’ve
been told for 220 years, "Shut up and do it this way."
It’s a trust thing that has to be built.
On Mentoring
At
GE, our core competency is people. As an example, I tell the story
of meeting the CEO of our global consumer finance company in London
three years ago. During the meeting he says, "I’ve just
had a meeting with my mentor and I did this and that…"
I said, "Your mentor? I thought you were the CEO. Who the
hell is your mentor?" And he says, "Oh, she’s 23
and she’s teaching me the Internet, and how to familiarize
myself with the computer." It was a brilliant idea.
The next day I gave a speech in Budapest, Hungary,
and I dropped in this mentoring story. Afterward, people came
up to me with the obligatory "Nice speech, Mr. Welch. You
had one good idea." Now I thought I’d had about 30,
but the one good idea was mentoring. It tipped the organization
upside down. It brought the young to meet with the top. So you
not only got the Internet, you got all the gossip in the organization.
That’s an idea that immediately became gospel in our company.
Everybody at our personnel interviews talked about their mentors.
It was incredible.
On the Ingredients for Success
You’ll be challenged a thousand times on this,
but be yourself. For no job in the world, for no situation in
the world, ever stop being yourself. Who you are is very important.
And the self-confidence you build is absolutely critical to you.
I see the ingredients for success as four E’s
wrapped in a P. The first E is energy. In a fast-moving global
society, every one of us has to be going like a house afire. The
second E is energizing people. It does you no good to be a whirling
dervish if you can’t excite those who work with you. One
of your jobs as a leader will be to energize people to take chances,
so that they succeed and build confidence. The third E is edge,
which is the ability to say yes and no, not maybe. The fourth
E is execute. Deliver. And when I say, "wrapped in a P,"
that’s passion.
On Key Traits of Leaders after September 11,
2001
I think there’s been a remarkable show of
leadership from Rudy Giuliani in New York. He was out there saying
what he knew, what he didn’t know. And he wasn’t afraid
to change it the next day when he knew something else. At GE,
we were lucky enough to appoint the Rudy Giuliani equivalent for
our CEO. My successor [Jeffrey R. Immelt] was in the job for two
days when [the terrorist attacks] happened. And he went to every
constituent, had videoconferences with everyone, had an analysts
meeting scheduled within a week. He told them what he knew, what
he didn’t know about the insurance problems, what he didn’t
know about the airline industry. GE stock went up 333 percent
[in the first half of October] as a result of people seeing this
man get out front and talk about the issues straight on. [Running
a company today] requires what I believe is a company’s key
attribute: its ability to be agile, to respond to change. And
it requires leadership.
On the Social Responsibility of Business
I think integrity is at the heart of a company.
You can’t even have one without integrity. It’s the
first value in everything we do. I think a company’s social
responsibility is first and foremost to winning because winning
companies are the only companies that can give back. Winning companies
pay taxes. Their people are excited and energized. We have 50,000
mentors at GE who work in the inner cities on their own. Now if
they were all sitting around wondering if they were going to keep
their jobs, do you think they’d be doing that? A winning
company gets the insecurity out of people.
A winning company does so much for the spirit
of the community and it gives back. It doesn’t cut corners
on the environment. It doesn’t have to cut corners in business
dealings. Its people are energized. It’s nothing but good.
Don’t feel guilty about being a winning enterprise. It’s
really, in the end, all you can be. Of all those dot-coms that
failed, what did they do? In the end, they auctioned the furniture
the following Monday. If you don’t win, there’s nothing
to give back. And I think that’s the number one social responsibility
of a company. After that, all goodness flows.—M.M.B.
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