Cutting a Long Story Short: When the Organization Was Falling Apart
There have been a number of theories of leadership, some of them credible and understandable, others complicated and practicing a mixture of various leadership styles; yet was no theory of success – until Jack Welch took the wheel and reinvented the whole perspective of what leadership is supposed to be.
Tracking the way Welch reorganized the company and turned it into a true goldmine will most possibly lead to understanding the whimsical ways in which leadership and management strategies collide to provide a perfect result. According to Angier, Pond & Angier (2004),
In 1960, Welch started in GR’s plastic division for an annual salary of $10,500 […]. In December 1980, Welch was announced as the new CEO and chairman of GE. It was a record-breaking appointment. At 45, Welch was the youngest chief the company has ever appointed. (Angier, Pond & Angier, 2004, 90)
Thus, the given paper is aimed at analyzing the methods which Welch used to turn GE into a clockwork mechanism, as well as learning about the specific strategies which Welch used, the strengths and weaknesses of the leader of the XXI century, and the theories which Welch used as the life buoy for his incredible venture.
Jack Welch and His Leadership Qualities: The Napoleon of the Business World
There are many ways to describe Jack Welch’s personality and approach towards his employees and his business; however, the one who managed to capture the essence of Welch’s multilateral personality and distill the three ultimate qualities that make the entrepreneur the king of the business world is Shriberg; according to the latter, the main features of a leader that Welch possesses are:
“(1) His personal willingness to keep learning and the establishment of a learning culture at GE; (2) constant open communication with employees, and (3) a willingness to take risks and embrace change” (Shriberg, 2010, 71). Considering each will bring one closer to the secret of Welch’s success.
Quality #1: charging people with energy
Despite rather rough and uncompromising manner of employing and dismissing the staff, Welch does have his own ways of making the company prosper, and one has to give the credit where it belongs to – with the help of a very specific leadership style, Welch has managed to bring the company back from ashes.
Welch, with the unceasing energy of his, filled the entire corporation with the desire to move on and generate new incredible ideas. Indeed, the idea of charging people with energy is one of the key principles of Welch’s leadership manner. As Shriberg (2010) commented on Welch’s teachings,
In 2005, Welch co-authored (with his wife Suzy) a book titled Winning. In this book, they stress the qualities and traits that a leader should possess. In particular, they emphasize that leaders should exude positive energy, energize others, reward and teach followers (71)
Indeed, the people who feel cheerful about the project and optimistic about the prospects, the whole working process speeds up considerably.
In addition, it is essential that Welch started paying a specific attention to the employees, trying to establish friendly relationships with each of them, which was crucial to the whole new idea of the GE Corporation.
Feeling valued and on par with the chief of the company, the employees start working more efficiently, thus, leading the company to a doubtless triumph. However, there are two more components of Jack Welch’s style which made it so incredibly successful.
Quality #2: one must have the guts
Another important element of Jack Welch’s strategy, the risk-taking idea, has led to the most impressive results.
According to Welch and his idea of reforming the company, when there is nothing else to do and the corporation is slowly going to a complete bankruptcy, the most reasonable thing is to hold on to the tiniest chance that one can see.
In Welch’s understanding, taking the not absurd chance possible is yet better than watch the company slowly dying, standing there and doing nothing. As Lane (2007) noticed,
Welch told me, long ago, that he had never encountered an IBM guy who had joined GE who was really good. But he had never seen one who was really good.
My observation was that they presented themselves as passionless, white-shirted techies, in contrast to the leadership corps of fantastics he was assembling. (44)
Thus, the second principle that Welch used when bringing General Electric to life was the idea that even the most unbelievable opportunity is worth checking out.
Even though the given suggestion might seem a bit too risky for every person I business to follow in the case of a certain emergency, it definitely works in the cases when there is nothing else to lose.
Even though the given method is not to be used in every situation, in certain instances, the nothing-venture-nothing-gain attitude can lead to great success. Thus, being able to decide on a flip of a coin is another Welch’s doubtless quality.
Quality #3: no regrets and nothing personal
The last, but definitely not the least quality that helped Jack Welch to bring the GE its glory back is the ability to abstract away from the personal relationships and decide what is best for the company.
Although one might consider Welch’s policy on firing the employees who could not contribute to the company somewhat tough and not quite as just as it could have been, it is still important to stress that Welch was doing what was best for the company, leaving the emotions behind.
As Hegar (2011) commented on Jack’s impressive start at the General Motors, “When Jack Welch took the reins in 1981, he spent a good deal of his time getting rid of managers who could not meet their goals.
In fact, he soon was dubbed ‘neutron Jack,’ because like a neutron bomb, he got rid of people but left buildings and machinery intact” (333). Obviously one of his greatest assets, overloading energy is what made Welch so successful.
Although the means which Welch resorted to seem quite rough, it is still obvious that Welch did what he had to do, and this fact makes him the leader that the company needed – the strong, uncompromising and resourceful man who could turn the entire world of the General Electric upside down. Cool-headed and strict, Welch is truly an ideal business leader.
Welch’s Leadership Strengths and Weaknesses: When the Strings Are Pulled too Tight
It goes without saying that, to make the General Electric famous once again and help the company gain even more profit than it used to, reorganizing it completely and offering a completely new style a leadership and approach to the employees, one has to be an extraordinary human being; one has to be Jack Welch.
However, along with his numerous strengths, Welch also has his weaknesses, which means that his leadership style cannot be completely flawless.
Once digging a bit deeper into the way Welch organized his work and changed the company’s strategy, one can possibly realize what exactly made Welch such strong a leader, as well as see some spots on the sun – that is, some minor slips in Jack Welch’s manner of managing the company.
One way or another, investigating the ways in which the style of famous Jack Welch falls flat is just as exciting as learning about the incredible ways in which Jack Welch managed to return GE its glory and make the company famous once again.
Once taking a closer look at the other side of the moon, one can see that each style of leadership has its flaws, and the key responsibility of a real leader is to spot the stage at which the chosen track starts leading to a dead end.
Then, with a careful choice of the appropriate tactics, one can find the way out of the complicated situation, which Welch has demonstrated in his revolutionizing of the GE management style.
Welch’s strengths: the three whales the earth stands on
As it has been previously mentioned, the leadership style that Welch has chosen is based on both maintaining perfect relationships with employees, thus, creating the optimum atmosphere for high productivity, and at the same time demanding from the employees the best that they can do.
The aspect of the trustworthy relationships with employees seems the key to Welch’s success, since without these relationships, he employees would have had an image of a tyrant for Welch, with the latter’s incredibly demanding attitude, and would have resisted the new company policy.
Judging by the given strategy which Welch chose, it can be suggested that his leadership style is based on a mixture of theories. For instance, the fact that Welch’s demands for quality were incredibly high indicates that the first theory behind Welch’s strategy was
Welch’s weaknesses: don’t hit a man when he is down
However, even being considered a demigod in the realm of management, Welch, like any other mere mortals, has his own weaknesses, too. However, it is worth mentioning that the weaknesses of Jack Welch are rather specific and practically are the reverse side of his qualities.
Indeed, any feature of a leader when being pushed to extreme turns against tits owner, which is exactly the case of Jack Welch and his corporate policy.
To be more precise, Welch takes his business so seriously and follows his own rues so hard that when it is time to compromise and choose the way which goes against Welch’s own set of principles.
Once facing the issue that requires choosing a “non-Welch” manner of acting, or the methods that contradict Welch’s own ideas and principles, Jack Welch is most likely to consider it inappropriate, which at certain points can pose a threat to the entire company.
Therefore, the lack of flexibility is the only yet the most dangerous issue that can stand in the way for the person with Jack Welch’s means of handing the corporation. In addition, the strategy of dismissing anyone whom Welch considered not suitable for the company and/or for a certain position can be questioned.
Perhaps, in certain cases, people whom Welch fired could be simply having the wrong positions and could actually be assigned for different kinds of work in the same company.
Instead of analyzing the peculiarities of each of the employees and offering them the positions in which they can deliver a splendid performance, Welch simply disposed of the ones whose results left much to be desired.
Indeed, a hasty manner of dismissing the people who could have actually brought profits to the company if working in a different department does not seem the decision that a wise leader would undertake.
However, the given observation is based on a typical organizational situation and does not take into account the peculiarities of the GE Co
From People to Models: Welch’s Leadership Style and the Theory Behind It
As for the theoretical background which Welch used to achieve such incredible success in such small amount of time, it is reasonable to mention that the traits of Welch’s leadership style can be attributed to a number of various theories, which can only mean that Welch resorted to the situational leadership theory. As Barker (1992) remarked,
The basic premise of situational leadership theories is that different leadership styles are needed in different situations […]. Leaders need to adapt their style to the situation at hand.
The situation theories contributed two new elements to the development of leadership theory: the situation and the follower. These theories are prescriptive – attempting to tell leaders how to act in a given situation. (Barker, 1992, 9)
On the one hand, it is crystal clear that Welch used the situational leadership style to understand the company needs, adapt to the existing situation and make the necessary changes.
However, it is also worth taking into account that Welch sought to develop relationships with his employees, which can be interpreted as the means to win their respect and motivate them by showing the example of a perfect worker.
Thus, it can be claimed with certainty that Welch combined the situational leadership approach with Fiedler’s contingency theory. According to Barker (1992), “The Contingency Model of leadership effectiveness sought to integrate person, process and situation” (10).
Therefore, it is obvious that Welch managed to reach the peak not only because of his winning personality, but also with the help of a solid leadership theory backing him up.
However, it is also important to add that the theory which Welch used as the cornerstone of his further attitude towards the company and the employees was not only the commonly known theoretical principle, but also a blend of his own idea of leadership and management.
As it has been mentioned previously, Welch often acted in spite of the management principles, which also led to quite fruitful results.
Thus, it is a clear-cut case of creating a new theory of leadership – the theory of success, making an example for the newcomers and the new explorers of the business jungle – one of the most dangerous and thrilling places one has ever set foot on.
Reference List
Angier, M. E., Pond, S. & Angier, D. (2004). 101 best ways to get ahead. South Burlington, VT: Success Network.
Barker, A. M. (1992). Transformational nursing leadership: A vision for the future. New York City, NY: Jones & Bartlett Learning.
Hegar, K. W. (2011). Modern human relations at work. Stanford, CN: Cengage Learning.
Lane, B. (2007). Jacked up: The inside story of how Jack Welch talked GE into becoming the world’s greatest company. New York City, NYC: McGraw-Hill Professional.
Shriberg, A. (2010). Practicing leadership principles and applications. New York, NY: John Wiley and Sons.