Welch has transformed what was an old-line American industrial giant into a highly competitive global growth engine. Welch has reshaped the company through more than 600 acquisitions and a forceful push abroad into emerging markets. How did Welch, who sat atop a business empire with $304 billion in assets, $89.3 billion in sales, and 276,000 employees in more than 100 countries, did it?
He did it through sheer force of personality, coupled with an unbridled passion for winning the game of business and a keen attention to details many chieftains would simply overlook. He did it because he was a fierce believer in the power of his people.
Welch’s profound grasp on General Electric stemmed from knowing the company and those who work for it like no other. There were the thousands of «students» he has encountered in his classes at the Croton-on-Hudson campus. Then there was the way he spent his time: More than half was devoted to «people» issues. But most important, he has created something unique at a big company: informality.
Welch liked to call General Electric the «grocery store». «What’s important at the grocery store is just as important in engines or medical systems,» said Welch. «If the customer isn’t satisfied, if the stuff is getting stale, if the shelf isn’t right, it’s the same thing. You manage it like a small organization. You don’t get hung up on zeros.»
You don’t get hung up on formalities, either. If the hierarchy that Welch inherited, with its nine layers of management, hasn’t been completely undermined, it has been severely damaged. Everyone called him Jack. Everyone could expect to see him hurry down an aisle to pick through the merchandise on a bottom shelf or to surprise an employee with a bonus.
Making the company «informal» meant violating the chain of command, communicating across layers, paying people as if they worked not for a big company but for a demanding entrepreneur where nearly everyone knows the boss. It had as much to do with Welch’s charisma as it had to do with the less visible rhythms of the company – its meetings and review sessions – and how he used them to great advantage.
When Welch became CEO, he inherited a series of obligatory corporate events that he transformed into meaningful levers of leadership. These get-togethers allowed him to set and change the corporation’s agenda, to challenge the strategies and the people in each of GE’s dozen divisions, and to make his opinions known to all.
