GE TWO-DECADE TRANSFORMA TION:

JACK WELCH LEADERSHIP

Case StudyJack Welch Leading Organizational Change At GE12

Jack Welch & GE Introduction

On September 6, 2001, John Francis Welch Jr. (Jack Welch), Chairman and Chief Executive Officer of General Electric Co. (GE), retired after spending 41 years with GE. During the period, he made GE the most valuable company in the world. Analysts felt that, with his innovative, breakthrough leadership style as CEO, Jack Welch transformed GE into a highly productive and efficient company. During Jack Welch's two decades as CEO, GE had grown from a US$13 billion manufacturer of light bulbs and appliances in 1981, into a US$480 billion industrial conglomerate by 2000. Analysts felt that Jack Welch had become a 'deal-making' machine, supervising 993 acquisitions worth US$13 billion and selling 408 businesses for a total of about US$10.6 billion

Jack Welch's Leadership Style

Analysts felt that Jack Welch's profound grasp on GE stemmed from knowing the company and those who worked for it. More than half of his time was devoted to "people issues". Most importantly, he had created something unique at a big company - Informality. The hierarchy that Jack Welch inherited with 29 layers of management was completely changed during his tenure. Everyone, from secretaries, to chauffeurs to factory workers, called him 'Jack'. Everyone could expect - at one time or another - to see him. Analysts felt that Jack Welch gave employees a sense that he knew them. Commenting on the informality at GE, Jack Welch said, "The story about GE that hasn't been told is the value of an informal place. I think it's a big thought. I don't think people have ever figured out that being informal is a big deal." Making the company "informal" meant violating the chain of command, and communicating across layers. Analysts felt that it had to do with Jack Welch's charisma and the way he used company's meetings and review sessions to great advantage. When he became the CEO, Jack Welch inherited a series of obligatory corporate events, which he had transformed into meaningful levels of leadership.

Is it ethical to restructure & delayering In reduction of position ? Yes, I think there shall be restructuring
in the company standards & it position. A better understanding of job responsibilities and performance combined with the ability to be a participant in the evaluation process have been instrumental in motivating employees and gaining their support during periods of massive restructuring and ever further stretching.

Workout Session problems

Employees realized that even though they often did not reach the stretch goals, they still performed at their highest possible level and therefore enjoyed personal satisfaction, High level of challenges & Targets which lead Manager To share their view Regarding change in organizational Structure & superiors where allotted to Make sure The ideas lead my managers are correct & can be adopted

Best Practices Of Other Companies

It improved the effectiveness & efficiency. It helped the, to obtained customer satisfactions ,the suppliers & even helped them to produce new products with other company's ideas. This Helped GE people to focus on the processes In their operations That would improve the company's performance. Best practices where also used by

Performance Of Managers
Goal setting and preparing the company on a corporate level for its competitive challenges; Empowering employees at all levels of the organization; and Communicating his new goals and visions through the entire organization, using such tools as extensive training programs, newly formed teams and 3600 review processes

Unrealistic Objectives

I liked The concept Of Stretch objectives As follows :

To achieve GEs leadership position and to drive constant growth, Welch required goals and stretch-goals to be set throughout the organization. Welch preached a philosophy he called painful opportunism, He used to plan his objectives in an unrealistic manner. He emphasized it as an dream target means his targets where very high he didnt just said it he achieved it as an supplementary . His six sigma program suggested that the quality should not exceed 3-4 in million operations . Means the work shall be perfect no obstacles shall be viewed.

Manager Ranking In organizational Unit

Yes, manager shall be ranked according to their individual level . So that there is an inbuilt Motivational level & performance & growth increases simultaneously. The aim of Welch was that the 10% bottom level employees shall be 10% top level employees

Thank You !