What Jack Welch Can Teach Organizations

April 26, 2016 at 3:07 am Leave a comment

Jack Welch was the CEO of GE. Under his leadership, GE became the most valuable company in the world, measured in market capitalization. Warren Buffet, perhaps the most famous investor of all times, said that other than this book by Jack Welch, no other management book will ever be needed! That got my attention! The title is : Winning.

He says ask, “how will we win here?” He says the most important thing missing in most organizations is candor. Instead of being candid about what doesn’t work and trying to fix it, most people make nice and ensure mediocrity. He says that maybe worked in the 1960s when we had no competition. He says he has preached “candor” everywhere. The second most important thing to have in a company is differentiation. Ah, wow, is that different from what is taught in school and in some politics. Differentiation means that rewards should be based on results. The top 20 should be lavishly rewarded and resourced, the middle 70 coached, and the bottom 10 ushered out the door and presumably onto their better match. I observe that the there would need to be some candor about results. Rewarding make nice would further push top performers away.

There is a lot more in this book, but just these first 3 chapters have been very eye-opening to me. For sure, I have observed exactly what Welch has observed. I have talked about it in different terms; indeed I have been tempted to see it as a culture of lying to ensure comfort. Maybe he is just more polite? Of course Welch served in a different kind of environment: his was big corporation and I have served in government schools and churches mostly. Perhaps the problem is more pronounced here? For instance, Welch asks for more candor in job performance evaluations; I often had to ask for performance evaluations and job descriptions. Differentiation would have been more anathema there. And even what results were wanted often was not clear.

No wonder we have trouble. This is somewhere between blindingly obvious and deeply thought provoking. Stay tuned!

Entry filed under: Center culture, Developing employees, Management & leadership. Tags: , , , , .

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