Jack Welch
- Use candor and simple rules and structures to improve efficiency and transparency.
Background
Values
Learning Objectives
Being completely candid and transparent in your communication
Instilling a desire for improvement and efficiency and a hatred for waste in all your actions
Using competition and rewards to motivate yourself and others
Finding simple structures and rules to help yourself and your team be more disciplined
Making achievable commitments and meeting those
Being quick in decision making and emphasizing action over analysis
Traits
Biography
Jack Welch was born into a typical middle class, suburban family. Although he stuttered as a child, his mother encouraged him by saying that his tongue couldn’t keep up with his brain. As a youth, Welch was hard-working, intelligent, and well-liked, and he excelled at work, sports, and school. He majored in chemical engineering, eventually receiving his PhD from the University of Illinois, and started working in GE’s plastics business as his first job out of college. Money was big influencer in Welch’s decision to get a PhD and to choose GE as his employer.
At GE, Welch set out to over-perform at his job. In an initial report on his product’s progress, where he was just expected to give a status update, he surveyed all his competitor’s products and analyzed where the most market opportunities were. This was the first sign of his later famous focus on both increasing profits and improving productivity. He was aghast at the complacency around him and thought GE was bloated with people who did very little. When his salary increase was the same as everyone else’s, even though his performance was better, Welch tried to quit, another sign of his regard for monetary compensation. Convinced to stay by a mentor, Welch continued to over-perform and take risks, even accidentally blowing up a plastics pilot plant. Despite this, he quickly worked his way up the managerial ladder with a relentless focus on exploiting opportunities, creating efficiency, and taking an entrepreneurial approach to running and expanding businesses. In 1981, Welch was named CEO. GE recorded revenues of roughly $26.8 billion in 1980; in 2000, the year before he left, they were nearly $130 billion. Fortune magazine named him “Manager of the Century,” and other companies took notice of his management practices. Many of the practices he started at GE were widely emulated and became standard industry practices in use today.
Questions:
- Is everyone being candid? How can we get people to say what they really think?
- What processes, tools, structures, metrics, or systems can we implement to be more productive?
- What part of our work should we standardize?
- Does this help us be more productive or profitable, and, if not, why are we doing it?
- Are responsibilities and goals clear and realistic?
- Does everyone on the team know what is expected of them?
- Does everyone on the team know where they stand?
- What do we need to do to make the decision or take action now?
- Are people being rewarded fairly for their work?
- How can I challenge people to do better?
- How do we ensure we meet our commitments?
- How do we win or, at least, beat the competition?
Behaviors
Be candid and insist on candor from others – Welch demanded clear and candid communications from everyone in GE. Challenge people if they are being unclear or you suspect they are not completely truthful.
Speak simply and ensure understanding – Eliminate all acronyms and jargon. Use short, subject- then-predicate sentence structures. Use the “Say it 3 times rule” to apply a structured approach to improving communications. Use this rule for all important communications, like action items, recommendations, and decisions, to make sure everyone has the same understanding.
Systematize – Create and follow processes and rules whenever possible. Strictly enforce the use of meeting agendas, email best practices, and communication rules, like the one above.
Be efficient – Make sure no time is wasted on irrelevant discussions or fancy embellishments. Cut off anyone who starts to gripe or waffle.
Be action-oriented – Ensure every interaction ends with an action item list of due dates and accountabilities. Follow up on these. Use action-oriented phrases for issues, like “What steps do we need to take to address this concern?” or “How do we better information for this decision?”
Be realistic – Question every goal, commitment, and action item to ensure that it can be met within the stated deadline. Be sure that the accountable party owns the due date.
Be competitive – Try to best others whenever possible. Make tasks into contests with rewards for the winners. Choose rivals to beat.
Focus on the bottom line – Set and communicate desired outcomes, making sure they all impact productivity or profitability. Make sure that your team remain firmly fixed on them.
Role Play Situations
To method-act the persona
and circumvent the ego
To Get into Character
Dress – Jack Welch is well-dressed, typical of every wealthy, businessman his age, with crisp, conservative, well-fitted suits. There is nothing noteworthy about Welch’s appearance. You should similarly blend in with your peers in your dress. Make sure that your clothing style does not stand out or reflect too much of your personality.
Speech – Welch’s style of speaking is very striking, due to his childhood stutter. His manner is extremely candid and very direct. He never uses business jargon or convoluted sentence structures. While you are Welch, banish all jargons, acronyms, and even analogies from your speech. Say exactly what you mean in clear and simple “subject then predicate” sentences. Welch relies on certain phrases that represent his philosophy and often repeats these in speeches. You will use the following phrases liberally:
- “You get what you reward for.”
- “People need to know where they stand.”
- “Winning companies are the only thing that counts.”
- “The team that fields the best players wins.”
- “Managing is about them, not about you.”
Activities to Conduct Alone
Become super productive – Welch was obsessive about productivity, and he believed in using tools, structures, and systems to help achieve this. For example, he was an early adopter and a big proponent of Six Sigma. To be Welch, you are going to start by evaluating how you can increase your own productivity.
1. Clean out your office and get rid of clutter and distractions. Analyze the layout to determine the most efficient way of working. Rearrange your office to help you be more productive. For instance, turn your chair so your back is to the door to eliminate distractions and items you use frequently are within reach. Get organized.
2. Analyze the way you work. How can you arrange your schedule to get more done? Some things you may want to consider are limiting your access to email and blocking time for yourself on your calendar. Streamline how often you touch email. Answer those right away than can be answered. You should also take this time as Welch to adopt a new productivity tool. This can be a productivity app, an email categorization function, an online task manager for your whole team, or even an internet blocker.
3. Analyze what you work on – Review your workload and categorize it into 3 buckets: work that contributes to profitability, work that improves productivity, and other. Strive to eliminate as much as the “other” category as possible. Create an action plan that will help you achieve this goal. While you are Welch you will prioritize the important over the urgent.
Turn negatives into positives – Welch is a big believer in a can-do attitude. One story he likes to tell is about Mark Little, the VP of Power Systems, which was the GE turbines division. After remediating an engineering problem with the jet turbines that occurred before his tenure, Little was demoted to running just the steam turbines business, which was a mature, slow growth product. At first, he was angry and upset over the demotion, but then Mark decided to prove everyone wrong, and he set about revitalizing the business. He improved efficiencies and introduced new technologies. This attitude not only got him his old job back, but promoted him beyond the division.
To help you become more positive, conduct the gripes exercise. Make three columns on a page with the headings: “Gripes,” “Opportunities,” and “Actions.” List all your gripes about your job/life and the things that are holding you back. Be honest with yourself and write them all. When you are done, go through each gripe and determine how it can be opportunity. For instance, having to deal with a difficult boss is a good learning experience or being stuck in a dead end job means it’s time to consider new career options. In the third column, write some actions you can take to turn the gripes into opportunities. Be sure to include dates for accomplishing those actions and revisit them often to monitor your progress.
Provide a reality check on your proposed actions – In order to maintain an efficient and transparent organization, it is important that goals, commitments, and accountabilities be realistic. Review your action plans from the above exercises and determine the percent probability of achieving those steps based on history. Be careful not to let wishful thinking intrude into your plans. Revise the actions that have a low chance of success into more realistic plans.
Activities to Conduct with Others
Clarify your communications – While you are Welch, you will concentrate on making all your communications as simple and clear as possible. In addition to your speech, your written communications should be clear and direct. For email, you will use the 3C rule:
- Clear – Review your email to make sure it is simple and understandable. It must be written in the subject-then-predicate structure, and short sentences. Clarify any ambiguous pronouns and clauses.
- Coded – The subject of the email should be coded according to the purpose of the email so that the receivers know what is expected of them. Suggested codes are: Action Required, FYI, Response requested plus any others that you may want. If a deadline is involved, include that in the subject heading.
- Complete – Include a summary at the bottom of the email that outlines the who, what, where, when, why of the email content.
As a result, all your emails will have a summary in the subject heading and at the bottom. Insist that your whole team use this method.
Apply a structured approach to improving communications – Use the “say it 3 times rule” for all important communications, like action items, recommendations, and decisions, to make sure everyone has the same understanding.
1. Say it once.
2. Say it again, rephrasing to simplify what you have said. Use only subject-then-predicate sentence structures and plain language.
3. Ask your listeners to paraphrase what they heard to make sure they understood.
Focus on efficiency – While you are Welch, conduct a meeting once a week with your team to determine how to be more efficient.
- Start by taking your team through the same exercise of examining their work and categorizing it into productivity, profitability and other as you did above. What work can you eliminate?
- Next brainstorm on how you can be more efficient, especially brainstorm any structures or methods that would help.
- Put an action plan together to eliminate work.
- Meet every week to report back on the action plan and brainstorm more ideas.
Use competition and rewards to motivate yourself and others – Welch is a big believer in winning, beating the competition, and rewarding wins. In fact, his second book is called “Winning.” He also uses the phrase, “Winning teams are happy teams.”
The following are some suggested activities to create friendly competitions:
- As part of your efficiency focus, turn your brainstorming efforts into a friendly competition with a specific prize. Reward the person who implements the most ideas.
- Turn mundane administrative tasks into contests. If HR or budget reports are due, reward the first person who completes them.
- Have a team lunch once a week/month to reward your team. The winner of your contest gets to pick the place and doesn’t have to pay.
- Use rivals to better yourself. Pick out 1 to 3 peers in the organization with whom you can engage in friendly competition, including bets, who will motivate you to be a better manager. Meet with your rivals to brainstorm some goals you can compete on, like the team that implements the most improvements or department that has the biggest improvement in customer satisfaction. Make sure you offer a prize to the winner.
Re-energize your team and help them find their passions – Welch developed what he called the Four Es and one P framework to help spot the winning players for his team. They are:
- Enthusiasm or positive energy (love of life)
- Ability to Energize others
- Edge – ability to make tough decisions
- Execute – get the job done
- Passion – authenticity
Share this framework with your team. Ask them to evaluate how well they meet the Es and P and how they could improve. Also ask your team members to conduct the gripe exercise. If you feel comfortable, you can share your own, but don’t feel obliged to do so. I’m not sure Welch would have shared his. Once they’ve finished these exercises, meet with each team member separately to determine actions you both can take to help them improve. Commit to at least three actions with due dates.
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