Jack Welch: biography, books

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Jack Welch did not start General Electric - the company was over a hundred years old when he took over the reins, but he managed to transform it and write books about it. To the surprise of many experts who argued that GE was too big for its shares to grow, and investing in it only for the sake of dividends, Welch's two decades of leadership increased its value by 40 times.

Stuttering boy

Jack Welch was born November 19, 1935 in Peabody, Massachusetts. His parents, father John Francis Welch and mother Grace, tried to instill in their son a sense of self-confidence, which was useful to him throughout his career.

Jack stuttered a bit as a child, but that didn't stop him from excelling in school and sports. He received a degree in chemical engineering in 1957 and a PhD in 1960, after which he joined General Electric as an associate engineer.

Always give more than asked for

JackWelch, who started at GE with the development of a new plastic for industrial applications, polyphenylene oxide (PPO), worked with a small development team. Due to GE's vast structure, he eventually had to "sell" his project to senior scientists in order to get their help.

Welch developed a good relationship with Ruben Gutoff, GE's chief executive, always doing more than he was asked to. When the manager needed a project analysis, Jack provided it along with cost analysis for similar products from competing companies like DuPont. It was part of his strategy to stand out from the crowd by exceeding expectations and offering a new and perhaps valuable perspective to his superiors.

Failed dismissal

When the bureaucratic nature of a large corporation such as GE began to annoy Welch, in particular the same allowances for all employees in the first year of work, he tried to quit. However, Gutoff persuaded him to stay by offering him a large pay raise and promising managerial positions in the future. So Rudolph agreed to help Jack bypass some of the bureaucracy that plagued GE. The special treatment he received from the chief executive strengthened his confidence in the differentiation policy he subsequently adopted. Jack Welch, whose quotes are very popular, said on this occasion: "Differentiation promotes people who are energetic and extroverted and underestimates the modest and introverted people, even if they are talented."

Big Bang

In 1963, Jack Welch received another lesson in working with people. The chemical plant exploded, and although no one was hurt, the shaking young man had to drag himself onto the carpet to Charlie Reed, a higher-level executive, to give an explanation. Instead of scolding his subordinate, Reed focused on what was learned from the incident and asked him for advice on how to avoid future explosions. Welch left the office with renewed confidence and an even more committed GE.

When a job opening for PPO Sales Project Manager came up, Jack pestered Gutoff to fill the position despite his lack of experience in the field. He obviously had some talent as a salesman, because the appointment was received. Welch made a tradition of celebrating his team's success by throwing a party every time orders reached $5,000. Successful team sales in 1968 led to Jack's appointment as general manager of the entire plastics division, the youngest at GE.

Jack Welch: manager's story

Plastic was out of favor with General Electric as the company struggled to break even after years of capital-intensive research. Welch, young and confident, predicted that GE's plastics business would double to rival DuPont, the chemical giant. Jack and his team went on an unprecedented publicity stunt. He envisioned billboards,a radio promotion and even a public display in a parking lot when Major League pitcher Danny McLain threw balls at Welch holding a sheet of industrial plastic as protection.

Jack achieved his goal of doubling the business within three years and thereby strengthened his management style. He was outspoken and even a little callous when dealing with incompetence, quickly firing anyone who didn't meet his standards, but he was also very generous with those who did. The employees he approved were expected to work hard, but also paid them very well. Based on the results achieved, in 1971 Jack Welch was promoted to head of the entire chemical and metallurgical division of the company.

Cadres decide everything

Jack Welch is focused on hiring and retaining the best people, only on a larger scale. The way he hires and fires staff has attracted unfriendly attention from GE's top management. The company increasingly relied on seniority and a flawed performance appraisal system as criteria for promotion, but Welch challenged that system by promoting and hiring people on merit.

In 1973, he wrote in his report that one of his long-term goals was to become the CEO of the company. That same year, Welch was promoted to multi-unit manager for $2 billion. Unable to delve deeply into every field from X-rays to semiconductors, he came to appreciate the people who run the business even more. From 1973 to 1980, he used this concept - personnel above all else, each time occupying more and more responsible posts.

Dark Horse

By 1977, it was clear that Welch's success in every position made him a dark horse in the race to become the company's CEO, Reginald H. Jones. As part of the test, all candidates were invited to the headquarters of the corporation and given large sections of it to manage. Jack got consumer goods and services. Part of this portfolio included a business that Welch immediately liked - credit. Later, as CEO, Jack will make GE's growth engine the credit division.

Decisive mistake

Competing for the top nomination, Welch made one notable mistake. Oddly enough, this later helped him succeed. He had proven his ability to get things done and make tough decisions about a losing business, but he had concerns about his die-hard sense of competition. As the cost of acquiring Cox Communication's cable and broadcast divisions rose with each negotiation, Welch canceled the deal.

He spent over a year convincing the GE board of the need for such an acquisition and now has to admit he made a mistake. For some board members, the fact that Welch made a mistake and acted quickly to correct it was an argument in his favor. In 1980, with the consent of the board, Reginald Jones informed him that he would be the new executivedirector.

Jack Welch wins

The journey from junior engineer to CEO took 20 years, an amazing pace of climbing the corporate ladder with 29 levels of management. One of the first things Jack Welch, the winner, did as CEO was move to eliminate those levels to make way for people and ideas.

Throughout his career, simple principles such as "people are everything" and a constant drive to anticipate and exceed expectations have allowed Welch to stand out from the crowd. There is no doubt that Jack had tremendous self-confidence, but it was the effort he put into people and the trust that made him a great manager and helped him transform the company as a CEO.

Private life

Welch's first wife Caroline bore him four children. In April 1987, the couple amicably divorced after 28 years of marriage. The second wife, Jane Beasley, was a former acquisitions and mergers lawyer. The wedding took place in April 1989, and the divorce took place in 2003

Third wife, Susie Wetlaufer, co-author of Jack Welch's Winning. At one time she worked as the editor of the Harvard Business Review. Jane Bisley, then still a wife, found out about the affair and informed the management of the magazine. In early 2002, Wetlaufer was forced to resign after admitting her relationship with Jack while preparing his interview.

Books

• Jack: Straight from the Gut was published in 2003.
• BookWinning was released in 2005 and hit 1 on the Wall Street Journal bestseller list.
• It was followed in 2006 by Winning: The 74 Toughest Questions in Business Today.

In 2009, Welch founded the Institute of Management in his name, in whose curriculum he was personally involved.