Jack Welch is one person who has been an exception who has not lost his effectiveness in 10 years but rather staying on the job and driving GE to loftier levels of accomplishment for 20 years. The best part is he has made himself a title ” An American Icon” This report states his management skills , roles and functions that he has used to bring GE to be one of the most successful company. When Welch became CEO in 1981, General Electric, GE was voted the best- managed company.
Nevertheless, Welch saw that the company, indeed the entire nation, could and should be better, and must be better to maintain its momentum in the last two decades of century and to propel itself into the twenty first. GE has always been a strategically led portfolio company with a mix of business in different phrases of their life cycles, which enables GE to deliver consistent earnings. (Leading) Welch set out on a mission to see GE become the world’s most valuable company (Planning), and he achieved that goal. In 1997, GE became the first company in the world to exceed $200 billion in stock market value. (Controlling) With a share price that rose an average of 23.
5 percent per year, by 2000 GE’s market value exceeded $500 billion. Welch worked to eradicate inefficiency by trimming inventories and dismantling the bureaucracy that had almost led him to leave GE in the past. He shut down factories, reduced payrolls, cut lackluster old-line units. Welch instructs his managers to ? hate bureaucracy and all the nonsense that’s comes with it’ he is shifting from top-down to outside-in orientation. This is basically saying let external demands and not internal management guide your productive behavior. This also means give priority to GE’s customers.
(Organizing) To have success, needs monitoring, consistent monitoring. Welch once preached that “At GE, we’re driving to be lean and agile, to move faster, to pare away bureaucracy. We’re subjecting every activity, every function, to the most rigorous review, distinguishing between those things which we absolutely need to do and know versus those which would be merely nice to know. ” (Monitoring) Now knowing that monitoring is important, the next step is to review and implement of improvements with good time management. Causing the previous GE leadership to be adapted to his own time and conditions.
(Effectiveness Skills) To have a full effectiveness, Welch must have the full support form his colleagues and peers. Netarelli who work for Welch for 26 years said that among the things he gleaned from Welch was to be decisive. He also praises Welch for having the ability to make quick, almost instantaneous decision and to be right the great majority of the time. The people closest to him said that he listens to others and he is consistent and fair. For those who did well he praises and reward for those who did badly, he respects them.
(Communication skills) Management experts say Welch’s reputation as a leader can be attributed to four key qualities, which are his intuitive portfolio strategist, skillfulness, willingness to change the rules if necessary, bring highly competitive, great communicator and motivator. He also became a teacher within GE, stepping into classroom. Led more then 250 class sessions in his two decades as a chairman , engaging more then 15000 GE managers and executives in a dynamic dialogue about the company, its functions and its future.
(Leader, interpersonal skills) Being a leader, he is direct, plainspoken and decisive also he conduct meetings aggressively . In December 1995 , Microsoft and GE(NBC) joined forces to operate a news network called MSNBC. (Entrepreneur) The cable television network, which debuted in July 1996, shared programming with the Microsoft network for computers. The idea was that the viewing public could glean news from either the television or the computer, or from both at the same time. In 1999 it was announced that GE would pursue an all-out online initiative.
This was how Welch explained, ? getting into Asia or out or onto the internet aren’t fundamental strategies, they’re tactics to respond to change. ” (Spoke person) Long before he announced this, he actually told the company that ? ‘ The game is going to change, and change drastically . ” (Disseminator) after knowing that technology change, economic stress and challenges from outside USA. He also saw Asian threats across every business, as Europe and Asia recovered from the cataclysm of world war 2.
Upon recognizing the problem, Welch aim to move GE faster then the economic pace so that GE does not get into any problem (Conceptual skills) Definitely every company does have their problem and that includes GE. Long before Welch was the CEO of GE, GE was sued for pollutions. In 1976 the federal government declared the chemical a public health, and a New York stated judge deemed GE guilty of violating state water standards. Reg Jones then still was the CEO of GE selected Welch to negotiate with the state on behalf of GE. Welch proved to be a tough bargainer, engineering a Hudson Rive settlement that limited GE’s liability to 3 million.
(Negotiator) The other problem was about the accusation that GE workers get the short end of the stick where compensation is concern. This is how Welch counter back, “We don’t go out into the streets and force people into our factories at gunpoint. Everyone who works for us here is because he wants to earn money and develop himself intellectually. The wages I pay are adequate and the atmosphere here is so exciting that they all want to stay. So where is the problem? ” (Disturbance handler) Beside he actually visited the White House during the administration of Ronald Regan and practically every president while he was GE’s chief executive.
He even played golf with Clinton and met with George W. Bush. (Figurehead) One last role that Welch uses is to allocating of resources, for example deploying some of the Utah international cash to acquire Employers Reinsurance Corporation for 1. 1 billion. This gives GE a new and different focus (Resource allocator) In conclusion, Jack Welch is one history maker. He made GE the first company to exceed 200 billions in the world. Welch has influenced the thinking of many corporate managers, not all of them to have been able to do things the way he did, even the German industrial company Siemens has taken Welch as a role model.