Jack Welch: My Greatest Leadership Learnings From a Life in Business

ladies and gentlemen please welcome mr. Jack Welsh welcome to Copenhagen mr. will show I think you prefer Jack Monsieur we are less formal today's headline is winning strategy and therefore I'd like to begin by asking why do relatively few of us really win big well I think well first of all I'm not sure that I agree with that but I never think of strategy is one thing I think strategy execution and people all go together and if you don't get the people right the strategy doesn't matter and if you don't get the people right you won't get the execution so you're dead so for my standpoint strategy sort of a purist thing it's more academic execution and getting it done is what it's all about but without question that whole idea of winning and and driving home what you're going to do and what you're not going to do is buh-buh-buh decided before we left that they weren't going to be in cars and their focus now on buses and trucks and excavators they can excel in that and they were in a bad game in cars but takes a courageous management to get out of the car business takes a lot of guts that's a huge decision and the fact that that company did it 15 10 15 years ago is a trick of each of the system and G hired you in 1960 and you got a boss who let's say was a bit against you how did that affect your will to win well I I came there as a fresh engineer the lowest one on the totem pole and I was going along quite well and I came in for my first annual review and I was making $10,000 and he didn't just like me he just thought I was sort of a thorn in his side but I got a raise I got $1,000 raise which was a 10% raise and I was quite pleased with that race until I went back to my bull pen where were six engineers were in there together and I happened to because of my mother's injection of self-confidence think I was thought I was a better engineer so I'm back and I sat down and I we all talked about what we got this year and every one of us got $1,000 race so I quit within two weeks and I moved my family Chicago about a thousand miles away and I was at the going-away party my boss was having from me actually he's quite pleased never going away party for me and I was at the party and my boss his boss from New York flew up to this small town we worked in and convinced me to stay got me away from this boss gave me a much bigger raise and I stayed and it changed my life forever and I feel I learned something from it yeah I'm a big lesson differentiation now I'm not sure this is popular here but I'm gonna say it anyway differentiation is absolutely the key to building great teams as I said in the beginning this thing this game that we're going to talk about tonight is this is all about building great teams the idea that Jack Walsh could design a jet engine build a plow pen write a comedy for television all these things is silly it's just not doable the only thing you can do isn't in many ways be a good orchestra conductor where you hire great people keep raising the standards keep getting better people and forcing yourself to learn from them the idea that you have all the answers is a joke you be as good as the team you get just like to focus on what happened from 1981 to 2001 because soon you were making headlines when you became CEO at that time GE had a very large range of businesses and you introduced a controversial strategy you touched upon it yourself before you called it I think something like number one fix so or close it we're not carrying losers anymore quote Jack Welch how did you come up with that strategy well Peter Drucker I've got to give him credit for this idea and it's a thought you all ought to think of a Peter Drucker had a zillion great thoughts but this was one of them if you weren't already in this business would you enter it now and if the answer's no what are you going to do about it and from that came fix clothes or sell so what we did was we put all the businesses that were that we were number one or number children and there were a number than there were 16 of them but we pride ourselves on having 71 businesses so we put all the other businesses outside of the circles we had a services circle a technology service business and a manufacturing segment three circles and then outside the circle were some 63 businesses the people in the outside the circles were matter than hell where are we no leper colony what's wrong with us etc we had some businesses that we were tearing as losers but decades but that's who we were we were in those businesses they no longer made sense we were making television sets in a town called Syracuse New York a plant there and I'm manufacturing cost was 25 percent more than the Japanese were selling television sets in Syracuse neon ha ha ha that didn't take a strategic where's to get the hell out and that's the type of thing we went through with all these businesses many times when we sold best businesses to other companies everybody won if you in fact don't have your people knowing exactly where they said what they're doing well what they have to do to improve and where their futures going the idea of calling people and guess what happens when this happens you have to call people then like I did in the early 80s and say don't I'm sorry Mary you have to go and mary says to you why me and you have to say to him are you the worst person that we have here and she says to you but I've been here 31 years why didn't anybody ever tell me that's the sin of management that's what we and people say I'm too kind to give an honest appraisal time that's cowardly we have 26 of the fortune 200 CEOs worked for me they had a boy ahead of her honey well these huge companies are my friends but we didn't have a place for them at the end and that's what you but they knew they knew the game transparency all I've talked about today you can't be too transparent with your people they must know where they stand but if you should ask the CEOs to learn from that lesson what what would that be if you take a think about the Michael Jordan quote what is the most important thing to have as a CEO the lesson to learn one of the jobs you have us as a manager for yet CEO one of the jobs you have a dementia is to pump every day self-confidence into your team to make them feel great to make people like me feel like I got a full head of hair and I'm six foot ten yeah that's what you want to do you want to get into people's skin and excite them about where you're going and why are you going one of the things about change as I'm sure all up to carry this but when you're that way when you come in as the new CEO or the new boss even every new boss has a new action new change let me get it and they tell you explain why we're changing what's in it for the company to change but they forget one thing people hate change the people want to know what's in it for me how did you make sure that your ideas was understood what do you think I didn't have the same job that all that I had all these diff iRiver can come on so my job was to get broad things we want to do more services than we want products we want to have sticky businesses so my strategy was be sure you're going for a sticky business what is the sticky business means it means that every business every sale you make is there's a follow on sale you sell a cat scanner or an MRI machine and you sell a twenty years service contract we all learn from mistakes on what would you stay say was your biggest mistake and what did it teach you I talked about blowing up a factory yeah that was pretty big I learned about how to treat people yes I also make a really iraq of an acquisition you know we have this bound realist behavior we want to share ideas with everybody we're growing so fast I had made six big acquisitions RCA NBC Network etc and I was swelling rather than growing and we we bought an investment bank can't get a Peabody now let me tell you what an investment I don't want not offend any of us from bankers here but the investment banks in America they have one basic if you will value on that left-hand column I talked about and it's my bonus my bonus my bonus don't tell me about sharing ideas and this culture meant nothing it was all about money so we clash constantly we had all kinds of errors in there we had people stealing money we had all kinds of fraud we sold it we got online UBS eventually bought it all and we got out home but it was a dramatic mistake that taught me how accounts you can do a thousand spreadsheets on acquisitions but if you don't get the culture right the numbers might look good when you put it together and the cultures are like this the deal is gonna fall on his face what would be your key advice for them to remember by if they want to go out and really succeed really win you don't have to pick one but I had to pick one it'd be get the hell out of the office get out and touch the people listen listen listen love them to death and touch them get inside their skin excite them about what they're doing give purpose to their jobs in their lives that's what this is all about we spend most of our waking hours on these jobs make them fun make them exciting and reward the hell out of those who do the job you're asked them to do thanks a lot ladies and gentlemen thank you very much thank you

Channel: Presidents Summit

Views: 155,908

Rating: 4.8665757 out of 5

Keywords: Jack Welch, General Electric, Strategy, Execution, Presidents Institute, Summit, Copenhagen, people, learnings, business

Id: xsEtVQCHYpE

Length: 12min 26sec (746 seconds)

Published: Wed Jun 01 2016