”You can’t grow long-term if you can’t eat short-term. Anybody can manage short. Anybody can manage long. Balancing those two things is what management is .” Jack Welch followed the principle of diminishing inefficiency, dismantling bureaucracy, constant change with opportunities and striving to be the best. Jack Welch was a transformational leader. During his 20 years of leadership as a CEO of GE Welch increased the value of the company from $13 billion to several hundred billion. In 1999, Fortune named him the “Manager of the Century,” and the Financial Times recently named him one of the three most admired business leaders in the world today.
Transformational leadership is a kind of leadership which changes followers towards a positive direction. The whole process not only makes the leader successful, but every member of the team gets involved in this way of transformation which leads to achievement as a whole.
Transformational leaders redefine the vision of followers, reform the systematic processes & renew the mission for enthusiastic commitment towards the goal. “Transformational leadership occurs when leaders broaden and elevate the interests of their employees, when they generate awareness and acceptance of the purposes and mission of the group, and when they stir employees to look beyond their own self-interest for the good of the group .” Jack Welch was a great transformational leader who provided growth and accomplishment for the company General Electric’s (GE).
Jack Welch was born in 1935 in Peabody, Massachusetts. He went to Salem High school and then ended up going to the University of Massachusetts Amherst to pursue his interest in chemical engineering. Welch has been married three times throughout his life and has four children. In 1960, Jack Welch joined GE as a chemical engineer for its Plastics division in Pittsfield, Massachusetts. Soon after, he was elected as vice president in 1972 and then he became CEO of the company in 1980.
Jack Welch’s management style became legendary at GE. GE Managers were able to manage however they wanted to as long as they followed the GE ethic of constant change and strive to do better. One policy that Jack Welch was famous for was his “downsizing policy.” He was referred to as “Neutron Jack” which meant that he was seen as a lethal neutron-bomb because of his firing of managers and working level employees. Jack downsized the company in order for long term profitability but did receive this “Neutron Jack” name in doing so. “In 1980 the year before Welch became CEO, GE recorded revenues of roughly $26.8 billion; in 2000, the year before he left, they were nearly $130 billion. The company went from a market value of $14 billion to one of more than $410 billion at the time of his retirement making it the most valuable and largest company in the world .”
Jack believed that, “There is only one way and it’s the straightway which sets the tone of the organization.” Some of his leadership principles consisted of being open to the best of what everyone has to offer and to transfer learning across the organization. An informal atmosphere with the right people in the right jobs was a competitive advantage to Jack. His leadership style made sure that everyone knew that they counted and that they had self confidence within the organization. Jack also thought that business had to be fun because it could energize the organization. Jack knew when to take a stand and when to let things go which made him a great leader as well as an influence on others.
Throughout Jack’s life he had a number of accomplishments. He was named the “Manager of the Century” by Fortune magazine and Jack was the youngest CEO of his generation. He always believed that his organization should strive to be either 1st or 2nd in each industry where they operated. Jack ended up developing a world class leadership training school that produced a number of CEO’s and corporate leaders as well as introducing Six Sigma into corporate America while building one of the world leanest organizations. Lastly, Jack Welch became famous for segmenting his management team into the top 20%, the middle at 70% and the bottom at 10%.
Jack Welch retired in 2001.Welch is currently the head of Jack Welch, LLC, where he serves as Special Partner with the private equity firm, Clayton, Dubilier & Rice and is a consultant to IAC (Interactive Corp) . In 2006, Welch’s net worth was estimated at $720 million. In 2006, Welch gave his name to Sacred Heart University’s College of Business, which will be known as the “John F. Welch College of Business” . Then in 2009 The Jack Welch Management Institute was developed by Jack Welch in partnership with Chancellor University, to create a business school aimed at providing leadership training to managers and executives. This institute launched in 2009 and classes began in 2010 . As you can see Jack Welch was a transformational leader. He transformed the company with his leadership styles which made the company grow and expand. I chose Mr. Welch because a twitter thread was made about him as I was thinking about what direction I would take my paper and I felt he was the perfect transformational leader.
Works Cited
1. “Businessweek.” How Jack Welch Runs GE. N.p., n.d. Web. 9 Aug. 2012. <http://www.businessweek.com/1998/23/b3581001.htm>.