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Jack Welch Leadership and Business SuccessJack Welch Leadership and Business Success


Jack Welch (1935- )


American boss (pictured right) of General Electric (GE) 1981-2001, founded by Thomas Edison (pictured right below) and producer of light bulbs, aircraft engines, plastics and electricity generators.

Time magazine’s manager of the twentieth century for transforming GE into the world’s best and most valuable company.


What are his tips about leadership and business success?

 Jack Welch Leadership and Business Success

1. “Control your destiny or someone else will”

If you don’t keep on satisfying customers, they will buy from your competitors and people will lose their jobs.

“The company can’t give job security only customers can”, he said.


2. “Change or die”

Keep on changing and improving before customer dissatisfaction forces you to (see point 1).

It is better to change early when it is still painful (“painful opportunism”).Jack Welch Leadership and Business Success

Always challenge people to:

  • get out of the comfort zone.
  • strive for better and better performance (see point 3).

He wanted GE to have the creativity and flexibility of a small company, and so a leader’s job is “to create, not to control”, he said.


3. Work-Out

This was the system that Welch introduced to challenge managers.

Their actions were openly challenged and scrutinized by:

  • their employees.
  • external stakeholders like customers and suppliers.

 Jack Welch Leadership and Business Success

4. Vision and purpose

He clearly communicated his vision of a customer oriented, world-class global company.

On arrival as chief executive, he told employees: “I want a revolution” because of the value he placed on big changes.



5. Ruthless and decisive

Nicknamed “Neutron Jack” by the press (the neutron was a nuclear weapon), he reduced GE’s workforce by 118,000 between 1980 and 1985 to make the company:

  • less bureaucratic and costly.
  • more adaptable to change.

His policy was to “fix, close or sell” any business which was not number one or two in the world.

 Jack Welch Leadership and Business Success

6. “Tough love” and honesty

The best leaders have the 4 E's:

  • energy.
  • edge (to make the tough decisions).
  • the ability to energize (getting people to do great things) and execute (getting results).


These attributes are reflected in his philosophy of “tough love” i.e. you have to be:

  • fair and kind (he sent out personal notes of encouragement), but
  • firm and tough (taking difficult decisions and being honest about people’s incompetence - see point 5).

Each year he fired the bottom 10% of employees (as GE still does) to encourage high performance from the people remaining.

“You’ve got to be hard to be soft”, he said.

 Jack Welch Leadership and Business Success

7. Empowerment and good people

He encouraged employees to:

a) take responsibility 

(for achieving the objectives that managers set them).

b) be high performers.

(and technically competent).

c) work effectively in teams.

d) believe in the company’s values.

(customer orientation, integrity, empowerment, quality, globalization and a passion for change and excellence).


 Jack Welch Leadership and Business Success

8. The “boundaryless organization”

This means making the organization more open and communicative by:

  • breaking down barriers between people (particularly in different departments and divisions).
  • creating closer relationships with customers and suppliers.


9. Be realistic

  • face reality (like competitors’ strengths).
  • don’t kid yourself that things are what they were, or what you would like them to be.

Jack Welch Leadership and Business Success 

10. Learning

He made GE into a learning organization that learns from other companies and its own successes and failures.

So he strongly supported:

  • informal contacts.
  • constructive debate
  • curiosity
  • the disclosure of information
  • the company’s management training centre at Crotonville, New York state.


11. Competitive advantage

Make sure you are better than your competitors on image, price and quality.

So in the mid-1990’s he successfully introduced:

  • the objective of six sigma i.e. fewer than 3.4 defects in a million.

“If you don’t have a competitive advantage, don’t compete”, he said.

 Jack Welch Leadership and Business Success

12. Speed

Products must be developed and sold to customers as quickly as possible.

So managers must:

  • be speedy in their decision making. 
  • be self-confident.
  • keep things as simple as possible.

“Do it faster next time”, he always told them.


13. Measure performance

He said only three things need measuring in any business:

  • customer satisfaction.
  • employee satisfaction.
  • cash flow.

  Jack Welch Leadership and Business Success

14. The will to win

Like the company he created, he is incredibly competitive and determined to be the best, successfully overcoming the handicap of a slight stutter.

His mother taught him to love success but cope with failure.


Key quotes on change

Change before you have to.

Change or die

Control your destiny or someone else will.


Key quote on customers

The company can’t give job security only customers can.


Key quotes on competitive advantage

If you don’t have a competitive advantage, don’t compete.

An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.


Key quote on selection

Getting the right people in the right jobs is a lot more important than developing a strategy


Key quote on leadership

Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.


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