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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

PROJECT REPORT

BUSINESS LEADERSHIP SKILLS

Transformational Leadership Skills - Ratan Tata & Jack Francis Welch

Submitted By: Submitted to:

Group # 4(Relationship Cohort) Dr. Harsh Sharma

AASHI AGRAWAL (08609061) (Facilitator (Business leadership) & PROJCT GUIDE)

GAURAV AGRAWAL (08609066)

TANUSHEE AGARWAL (08609065)

VINAY G PANDEY (08609068)

VAIBHAV SHARMA (08609034)

PUNEET AGGARWAL (08609012)

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

ACKNOWLEDGEMENT

Before we embark upon the details of this project, let us take this opportunity to express our
heartiest gratitude towards the people who have provided invaluable help & support through
the entire duration the project

We are thankful to our facilitator Dr. Harsh Sharma for his continuous guidance & support.
We would like to thank him for giving us excellent suggestion and affectionate, encouraging
through development of project and for devoting his precious time.

We offer thanks to him for his co-ordination and grateful to all our well-wishers who extended
their support and to the entire staff of MBA Department of Jaypee Business School for their
valuable help throughout the work

PUNEET AGGARWAL (08609012)

VAIBHAV SHARMA (08609034)

AASHI AGRAWAL (08609061)

TANUSHEE AGARWAL (08609065)

GAURAV AGRAWAL (08609066)

VINAY G PANDEY (08609068)

Introduction To transformational Leadership

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

Transformational leadership occurs when leaders “engage with others in such a way that
leaders and followers raise one another to higher levels of motivation and morality” (Burns,
1979). This is a mutual relationship which shares values, mission, and vision for what each
participant seeks to accomplish. The relationship becomes moral because it raises the level of
human interaction and ethical aspiration of both leader and follower. The relationship has a
transforming effect on the leader and follower in the means of achieving the goal and the ends
they are seeking. Leaders take the initiative in making the leader led connection and allow for
the communication exchange to occur (Burns, 1979).

Transformational leadership is not limited to a position or resources as the leaders “serve as


an independent force in changing the makeup of the followers’ motive base through gratifying
their motives”. Transformational leaders move followers to transcend their own self-interests
for the good of the group, organization, or country (Bass, 1997).Transformational leadership
is essentially leadership that motivates followers to transcend their self interest for a collective
purpose, vision, and/or mission. This form of leadership tends to foster trust and admiration
toward the leader on the part of followers (Feiberg, Ostroff, & Burke, 2005)

There are four factors to transformational leadership-

1 Role and identification model -The leader provides communal design of vision and
purpose, values and norms that gives meaning to the work. He plants pride and feelings of
mission, enhance the performance capabilities and gives personal example. The followers
trust him, identify with his goals and want to be like him. They internalize him and act in his
"spirit" even when he is not around.

2. Inspirational motivation describes managers who motivate associates to commit to the


vision of the organization. Managers with inspirational motivation encourage team spirit to
reach goals of increased revenue and market growth for the organization.

3. Intellectual Stimulation describes managers who encourage innovation and creativity


through challenging the normal beliefs or views of a group. Managers with intellectual
stimulation promote critical thinking and problem solving to make the organization better.

4. Individual consideration describes managers who act as coaches and advisors to the
associates. Managers with individual consideration encourage associates to reach goals that
help both the associates and the organization

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

Evolution of transformational leadership

The term transformational leadership was first coined by J.V. Downton in Rebel
Leadership: Commitment and Charisma in a Revolutionary Process (1973).

James MacGregor Burns first introduced the concept of transformational leadership in his
book Leadership (1978), during his study of political leadership, but this term is now used in
organizational psychology as well. He described it not as a set of specific behaviors, but rather
an ongoing process by which "leaders and followers raise one another to higher levels of
morality and motivation" . Transformational leaders offer a purpose that transcends short-term
goals and focuses on higher order intrinsic needs.
Transformational leaders raise the bar by appealing to higher ideals and values of followers.
In doing so, they may model the values themselves and use charismatic methods to attract
people to the values and to the leader.

Burns was influenced by Abraham Maslow’s Theory of Human Needs. This theory
recognizes that people have a range of needs, and the extent to which they will perform
effectively in the workplace will be affected by the extent to which these needs are satisfied.
Transformational Leadership fits into the higher levels, as it requires a high level of self
esteem and self actualization to successfully be an authentic transformational leader.

It’s about values, purpose and meaning:


Essentially the leader’s task is consciousness-raising on a wide plane. The leader’s
fundamental act is to induce people to be aware or conscious of what they feel - to feel their
true needs so strongly, to define their values so meaningfully, that they can be moved to
purposeful action.”
(Leadership, pp 43-44)

Burns was one of the first scholars to assert that true leadership not only creates change and
achieves goals within the environment, but changes the people involved in the necessary
actions for the better as well: both followers and leaders are ennobled. Burns became famous
among alternative leadership scholars because his model of transformational leadership
included an ethical/moral dimension that, prior to 1978, had not been infused into any
leadership theory Bernard Bass, a disciple of Burns, defined transformational leadership in
terms of how the leader affects followers, who are intended to trust, admire and respect the
transformational leader.

He identified three ways in which leaders transform followers:


• Increasing their awareness of task importance and value.
• Getting them to focus first on team or organizational goals, rather than their own interests.
• Activating their higher-order needs.

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

In contrast to Burns, who sees transformational leadership as being inextricably linked with
higher order values, Bass sees it as amoral, and therefore questions the morality and ethical
component of transformational leadership.

Advantages of Transformational Leadership

1. Inspires confidence in employees


2. Boosts the self-confidence of the employees
3. Helps employees to commit to personal and organizational achievement
4. Encourages employees to volunteer to perform tasks
5. Allows for full participation of employees, thereby encouraging opportunities to
make presentations
6. Reduces leader overload
7. Promotes ownership of ideas presented
8. Encourages building skills, bonding among individuals, banking of ideas within
the organization, and utilizing these in a professional manner
9. Higher employee satisfaction
10.Better job performance
11.More organizational citizenship behavior
12.Emphasize associates' needs and values

Disadvantages of Transformational Leadership

1. Transformational leadership more as a personality trait than as a learned behavior,


and have the potential for abusing power.
2. Concept is the assumption that leadership is a position where the leader is
portrayed as the boss.
3. Implementation of this strategy may instigate an attitude of threatening in certain
circumstances

Rationale for selecting leader


Jack Welch- During his 20 years of work as the C.E.O, he transformed the company from an
aging industrial manufacturer into one of the world’s most competitive organisations, by
building more shareholder wealth than any corporate chief in history. He reinvented the
company. Jack Welch has been a long standing and a prominent figure around the world. His
adaptability and the constant hunger for change are remarkable.
Ratan Tata - Widely recognized as the person responsible for transforming the Tata Group, a
large India-based conglomerate, from an unwieldy collection of businesses into a relatively
more nimble group of companies better prepared to take advantage of opportunities. He took
in order to inject professionalism in the Group. His chose two directions for growth -
innovation and globalization - that for the Group companies.

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

Leadership styles of the selected leaders


Jack Welch
In 1960, Jack Welch joined General Electrics in the Plastics Division in Pittsfield,
Massachusetts, USA, where he formed his leadership ideas. Despite working in a very
exciting and fast paced environment, but because of too much bureaucracy prevailing in the
organization, he almost quit the job in 1961.

Because of his good work in 8 years, in 1968, Jack Welch was made the company’s youngest
General Manager at the age of 33.

In 1980, General Electric announced the name of its 8th Chief Executive Officer: 45 years old
– John Francis Welch (Jack Welch).

During his 20 years of leadership at General Electric (GE) Welch increased the value of the
company from $13 billion to several hundred billion.

His Leadership Style

His no nonsense leadership style gave him a reputation of being hard, even ruthless, but also
fair when making business decisions. Welch had little time for bureaucracy and archaic
business ways. If managers didn't change they were replaced with someone that could change.
Managers were given free reign as long as they followed the GE ethic of constant change and
striving to do better. He ran GE like a small dynamic business able to change as opportunities
arose or when a business becomes unprofitable.

In his pursuit to change and streamline the General Electric giant Welch once earned the
nickname of” Neutron Jack”. More than 100,000 GE employees had their jobs taken from
them during his reign. GE businesses had to be the best performing business in their field or
they were sold.

General Electric saw great growth and expansion under Jack Welch's leadership. Through
streamlining operations, acquiring new businesses, and ensuring that each business under the
GE umbrella was one of the best in its field the company was able expand dramatically from
1981 to 2001.

Jack Welch, the tomorrow driven leader loved change: Change keeps everyone alert and on
their toes. It’s a big part of the reality of business. Take the business environment – it is
constantly changing: new competitors, products. Any business that ignores this fact is doomed
to collapse. Jack Welch never stopped re-arranging the G.E. agenda. The goal may be the

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

same, never ending growth but he said that the tools and methods were constantly changing.
He encouraged his colleagues to never stop thinking about the need for change.

On December 12, 1995, G.E. purchased RCA, the communication giant, which includes the
NBC Telecommunication Network, together found a new corporate power, placing it 7th in
Fortune 500.In June1987, G.E. merged with Thompson SA in Electricals division.

Stop managing, start leading and cultivate managers: He disliked the notion of
management. Most managers in his view over- managed. Those who over managed helped to
create a bureaucratic environment, which according to Welch, kills large companies. He
decided that G.E.’s leaders had to change their management styles i.e. too much controlling
and monitoring .The only way to last at G.E. was to get on board, to become a lean leader, to
adapt oneself to the company’s value and culture.

Face reality and then act decisively: Welch believed that whether in business or in life,
those who are able to acknowledge truth are usually successful.

In Oct 1981, six months after he became chairman and C.E.O, Welch wasted no time in
spelling out his revolutionary plan for a new G.E. to 120 corporate offices of the company.
The first reality observed by Jack Welch was the rising competition from the foreign
companies. So he thought critical to reduce the size of G.E.’s workforce and get rid of
business that had been long a burden to the company and the first step he took was scrapping
G.E.’s House-wares business.

Be simple, be consistent and hammer your message home: Jack Welch has always
believed in being simple, relentless consistency and follow up on everything. Welch’s
consistency has indeed helped to revive General Electric and remake it into one of the most
competitive companies.

2. Building the market- Leading Company:

Be No1 or No2 but don’t narrow your market: To make General Electric more
competitive, Jack Welch developed a strategy that required all G.E. businesses to be either 1st
or 2nd in their field. He was convinced that inflation would become the most prominent
enemy in 1980’s leading to slower worldwide growth. Therefore, he always insisted upon

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

being the No1 or No2 leanest, lowest-cost worldwide producers of quality goods and services
or have a technological edge.

He always believed in the surprise move i.e. the bold play. He was confident that General
Electric would prosper if he acquires and divests companies and remained focussed.

Fix, close or sell: In the early 90’s, NBC Telecommunication Company, which was acquired
by General Electric in the 80’s was facing very difficult to compete with the other US
competitors, Welch decided to fix NBC with a series of quick and clever decisions. Jack
Welch and the then President of NBC Mr. Bob Wright, decided to replace current managers
with more business-minded entreprenual leaders. Once this was in place, both were confident
that NBC could indeed be “fixed”.

Don’t focus on the numbers: Jack Welch’s philosophy was that numbers aren’t the vision,
numbers are the product and he never used to talk about numbers. The three measurements he
believed to live by would be employee satisfaction, customer satisfaction and cash flow.

Sharing ideas across business: Jack Welch said that G.E.’s core competency was sharing
ideas across businesses, across what he called the boundary-fewer organisations and that the
company viewed itself as a laboratories that shared ideas, financial resources and managers.
Be an open learning organisation. An idea can be from any source. So, we will search the
globe for ideas. We will share what we know from others to get what they know.

3. Forging the boundary less organisation

Be lean and agile like a small company: Jack Welch believed that to survive in an
increasingly competitive environment, large companies like G.E. must stop behaving and
thinking like large companies. They should get lean, agile and start thinking like a small
company. At first, he dealt with those layers of management that he believed, were clogging
the G.E. machine. Thus, he removed the entire 2nd and 3rd levels of management- the sectors
and the groups. The new arrangement proved very clean, simple and effective .After this
arrangement, people in the organisation could communicate well. They move fast as they
knew the penalties for hesitation in the market place.

Tear down the boundaries and use the brains of every worker: Jack Welch felt that there
were far too many boundaries within General Electric such as:

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

Management Layers Engineering and marketing people G.E .and its customers
G.E. and the whole outside community Boundary lessness, for Welch defines G.E. as an open,
informal company whose employees can move swiftly and effortlessly and where they can
connect to the outside world just as quickly and effectively.

In 1989 he designed a 10-year program called “WORK-OUT”, wherein workers were given
freedom to share their views with their managers. Through this program, Jack Welch gave the
employees the right and responsibility to come up with their own idea for solving problems.
The main idea was to remove the “boss element” from G.E. The goal was to give everyone a
say in the way the organisation was managed- to keep bosses from dictating every step in the
decision making process. By getting more involvement on the side of the employees, Welch
argued that they would be helping to strengthen G.E.’s businesses and healthy growing
businesses were the best guarantee for job security.

4. Push Service and globalization for Double digit Growth : Jack Welch always thought of
growing G.E.’s business. In the past, G.E.’s manufacturing business consisted of lightbulbs,
home appliances, etc, which were the primary growth engines. Jack Welch brought the growth
of G.E. Capital Services and the acquisition of NBC Telecommunication Network into a new
diversified company. G.E. Capital Services earned 4$billion in 1996 and NBC earned 95$
billion in 1996.

Jack Welch also brought growth in the financial services category as he made G.E. Capital
from a small company into a company having 27 businesses out of which 19 had double digit
growth. After this more than 60% of the revenues of General Electric came from services.

Jack Welch saw globalisation as a new reality and as a great opportunity for G.E. So in 1980,
Jack Welch bought 2 strategic businesses, Plastics and Aircraft Engines to service the global
market. Between 1985-95, revenues from overseas operation increased from 20% to 38% of
total G.E.’s revenues. In 1987, he launched a global revolution when he acquired a French
Company specialising in medical imaging “Thompson”.

Jack Welch knew that to grow at a double-digit rate, General Electric would have to make
significant pushes in Europe & Japan. In the first half of 2000, G.E. became the first company
to shatter the 600$ billion barrier before settling back at a level below 500$billion. In 1999,
Welch launched the E- initiative business within General Electric which would soon be felt at
every level in the company.

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

5. Drive quality through the organisation

In early 80’s and 90’s when G.E. benchmarked itself with other companies like Motorola,
Texas Instruments, H.P. and Zerox, it became clear that there was much room for improving
quality of G.E. ’s products and services. He stressed on improving speed, productivity and
getting employees and suppliers more involved in the company.

In 1995, Jack Welch empowered the concept of “SIX SIGMA”. He put in place another
initiative that would transform the company. Products and Services was G.E.’s crusade to
generate revenues from the consumers. Within 5 years of empowering “SIX SIGMA” in the
company it’s revenues from services doubled, nearly reaching 17$ billion in 2000.

Jack Welch adapted “Six Sigma” within the company to achieve quality improvement in
business processes which in turn entails the formation of a project team.

His 4 step process for achieving this was called as “MAIC” which included:

1. Measure,

2. Analyse,

3. Improve,

and

4. Control

PRINCIPLES OF JACK WELCH AT GENERAL ELECTRIC

1. Act like a leader, not like a manager

2 Embrace change, Don’t fear it:

Welch had a seven-point program for management:

(1) Develop a vision for the business; Jack Welch gave a vision “Either number 1 or 2 in
any business it is in”.

(2) Change the culture to achieve the vision: Welch’s leadership theory depends heavily on
the power of delegation. Welch, however, does not just relinquish all power to good people.

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

He balances hands-off management – giving his business heads full autonomy and the power
of decision – with hands-on leadership. He keeps his “direct reports” on their toes by the
unpredictability of his interventions in sometimes, lesser matters.

(3) Flatten the organization: Welch was known for destroying the nine-layer management
hierarchy and bringing a sense of informality to the company.

(4) Eliminate bureaucracy: Welch waged a war on bureaucracy. He removed Layers upon
layers of heads who were, according to him, harmful and whose roles where vague, who
slowed decision-making, blurred responsibility, and created undoable jobs.

(5) Empower individuals: Welch view the liberation and empowerment of middle managers
as the key to productivity gains. In order to win them over, Welch recipe was as follows: (1)
Free managers to manage – and to rise; (2) Defeat bureaucracy and rigidity; (3) Generate and
use new ideas; (4) Empower workers to flourish and grow

(6) Raise quality: Company efficiency was to benefit from three initiatives Work-Outs, Best
Practices, and Process Mapping. Work-Outs produced short term improvements in efficiency
and costs but also served a Long-term educational aim.” Everyone’s job is quality.” This is
evident in Six Sigma quality program which was adopted in1995 from Motorola. They turned
it into an internal productivity program, saving waste and all that, then they turned it to their
Customers – its success was measured by monitoring customer satisfaction and not just
monetary success.

(7) Eliminate boundaries: Welch believes leadership must be personal. Nobody at GE gets a
formal letter from him – it comes in his own handwriting and rewards were always
accompanied by regards and face-to-face evaluations. The rewards were tremendous as long
as performance matched and exceeded expectations.

Ratan Tata

He joined the Tata Group in December 1962, after turning down a job with IBM on the advice
of JRD Tata. He was first sent to Jamshedpur to work at Tata Steel. He worked on the floor
along with other blue-collar employees, shoveling limestone and handling the blast furnaces.
Ratan Tata, a shy man, rarely features in the society glossies, has lived for years in a book-
crammed, dog-filled bachelor flat in Mumbai's Colaba districtRatan Tata is the chairman of
the Tata Group, India's largest corporation. He is the latest in a long line of Tatas to head the
family-owned company. Tata group is very huge and has its reach in every sector. The guiding
principle of tata is nothing worthwhile is ever achieved without deep thought and hard work.
In 1971, Ratan was appointed the Director-in-Charge of The National Radio & Electronics
Company Limited (Nelco), a company that was in dire financial difficulty. Ratan suggested
that the company invest in developing high-technology products, rather than in consumer
electronics. J.R.D. was reluctant due to the historical financial performance of Nelco which
had never even paid regular dividends. Further, Nelco had 2% market share in the consumer

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

electronics market and a loss margin of 40% of sales when Ratan took over. Nonetheless, J. R.
D. followed Ratan's suggestions.

From 1972 to 1975, Nelco eventually grew to have a market share of 20%, and recovered its
losses. In 1975 however, India's Prime Minister Indira Gandhi declared a state of emergency,
which led to an economic recession. This was followed by union problems in 1977, so even
after demand improved, production did not keep up. Finally, the Tatas confronted the unions
and, following a strike, a lockout was imposed for seven months. Ratan continued to believe
in the fundamental soundness of Nelco, but the venture did not survive.

In 1977, Ratan was entrusted with Empress Mills, a textile mill controlled by the Tatas. When
he took charge of the company, it was one of the few sick units in the Tata group. Ratan
managed to turn it around and even declared a dividend. However, competition from less
labour-intensive enterprises had made a number of companies unviable, including those like
the Empress which had large labour contingents and had spent too little on modernisation. On
Ratan's insistence, some investment was made, but it did not suffice. As the market for coarse
and medium cotton cloth (which was all that the Empress produced) turned adverse, the
Empress began to accumulate heavier losses. Bombay House, the Tata headquarters, was
unwilling to divert funds from other group companies into an undertaking which would need
to be nursed for a long time. So, some Tata directors, chiefly Nani Palkhivala, took the line
that the Tatas should liquidate the mill, which was finally closed down in 1986. Ratan was
severely disappointed with the decision, and in a later interview with the Hindustan Times
would claim that the Empress had needed just Rs 50 lakhs to turn it around. Despite of these
two failures in the initial career Ratan proved his mettle by turning the Tata sons into the
largest and most respectable company of India.

About the personality of Ratan Tata:


• Very Dignified
• Ethical
• Dependable
• Believes In Keeping Promises
• Loyal and Believes in Relationships
• Questioning the Unquestionable
• Risk taker not a Speculator
• Exemplary Leadership Qualities and a Tremendous Motivator
• Visionary - -“One hundred years from now, I expect the Tatas to be much bigger than
it is now. More importantly, I hope the Group comes to be regarded as being the best

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

in India. Best in the manner in which we operate, best in the products we deliver and
best in our value systems and ethics. Having said that, I hope that a hundred years
from now we will spread our wings far beyond India.”
This statement is said by Ratan Tata and shows the vision to do the thing
• Strategist – He is a deep thinker and extremely strategic. He is always 2-3 steps
ahead"- Alan Rosling ED, TATA Sons
• Initiator & Change champion - Ratan was the chief architect of the Corus deal. It
was worried about the magnitude and the amount of money. But he instilled
confidence.
• Risk taker – “If you put a gun to my head, you had better take the gun away or pull
the trigger, because I'm not moving.” "While he doesn't look it, he's one of the
toughest people I've ever known.
• Expertise- "He has a tremendous technological brain. When people come to him for a
critical decision, he will give a very quick answer; his responses would be crisp, and
leaving no room for doubt. His involvement in cross-border deals could be quite
significant. And that’s precisely what gives the CEOs the confidence to move ahead
without doubts.
• A man of integrity- Ratan Tata has shown that there is no other way he will do
business other than do it ethically.
• Influence Tactics- He uses Consultation , Rational persuasion and Exchange tactics

LEADERSHIP GRID

HIGH

CONCERN
FOR
PEOPLE

LOW

1 9
LOW CONCERN FOR
HIGH
PRODUCTION

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

Conclusion:
We can safely conclude that both the leaders selected for the analysis are found to be
Transformational. Where in the case of Jack Welch he talked about “Stop managing, start
leading and cultivate managers”, “Be simple, be consistent and hammer your message home”
but the most important thing according to Jack Welch was that “Don’t focus on the numbers”.
Jack Welch’s philosophy was that numbers aren’t the vision, numbers are the product and he
never used to talk about numbers. The three measurements he believed to live by would be
employee satisfaction, customer satisfaction and cash flow. A significant attention is on the
satisfaction of people . Jack Welch said that G.E.’s core competency was sharing ideas across
businesses, across what he called the boundary-fewer organisations and that the company
viewed itself as a laboratories that shared ideas, financial resources and managers. Be an open
learning organisation. An idea can be from any source. So, we will search the globe for ideas.
We will share what we know from others to get what they know. for Welch defines G.E. as an
open, informal company whose employees can move swiftly and effortlessly and where they
can connect to the outside world just as quickly and effectively.

In 1989 he designed a 10-year program called “WORK-OUT”, wherein workers were given
freedom to share their views with their managers. Through this program, Jack Welch gave the
employees the right and responsibility to come up with their own idea for solving problems.
The main idea was to remove the “boss element” from G.E. The goal was to give everyone a
say in the way the organisation was managed- to keep bosses from dictating every step in the
decision making process. By getting more involvement on the side of the employees, Welch
argued that they would be helping to strengthen G.E.’s businesses and healthy growing
businesses were the best guarantee for job security. He stressed on improving speed,
productivity and getting employees and suppliers more involved in the company. Welch
program for management talks about :

(1) Develop a vision for the business; Jack Welch gave a vision “Either number 1 or 2 in any
business it is in”.

(2) Change the culture to achieve the vision: Welch’s leadership theory depends heavily on
the power of delegation. Welch, however, does not just relinquish all power to good people.
He balances hands-off management – giving his business heads full autonomy and the power
of decision – with hands-on leadership. He keeps his “direct reports” on their toes by the
unpredictability of his interventions in sometimes, lesser matters.

(3) Empower individuals: Welch view the liberation and empowerment of middle managers as
the key to productivity gains. In order to win them over, Welch recipe was as follows: (1) Free
managers to manage – and to rise; (2) Defeat bureaucracy and rigidity; (3) Generate and use
new ideas; (4) Empower workers to flourish and grow

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Group # 4 (Relationship) Transformational Leadership

Ratan Naval Tata & Jack Welch

Whereas in case of Ratan Tata, we find strong values and vision prevailing in the organisation,
ever individual in the group take vision of the group as sacred note, every individual is
committed to the vision of the group and act according to them,. There is a lot of professional
freedom give to the employees to think new ideas and implement them, if they are good for
the growth of organisation or the society. A man of integrity- Ratan Tata has shown that there
is no other way he will do business other than do it ethically. The value system imbibes in
each and every employee of the organization. Ratan Tata took decision in the favour of the
employees even if there is some kind of short term loss (for example the Singur episode).
Key Learning: Here we studied two different styles of management & leadership, we found
that where in the case of Jack Welch, leadership was having a hint of carrot & stick approach.
He used to sack the non or under performer. Where in the approach of Ratan Tata we found
that he believed more on ethics, values and vision, they are trying to contribute to society in
some way or the other. However sacking is also done in Tata conglomerate but only in
exceptional case. Another difference could be in the form of Risk taking abilities, Tata showed
more proximity towards

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