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Part - III

Welch believed GE's core competency is not in achieving double-digit growth but in development if people because only great people can make things happen. Consistency has been a Jack Welch virtue. He not only outlined a vision for the company, also described in depth the way a GE employee ought to behave and he himself lived that behaviour to set an example of leadership. GE's model was consistent across its vast array if business, across all the countries and over the years under Welch's leadership.

He set some values like empowering employees, culture of a learning organization and a boundary less structure where informality and simplicity rules. Welch deeply incorporated these values into the fabric of GE and insisted these values should be followed across the organization irrespective of the place and time. He also wanted all A leaders to follow live these values - otherwise he simply clarified those managers have no place in GE. Even newly occupied firms had to undergo "GEification" i.e. integrating these values into their organizational set-up.

Welch had a great passion for learning and he transformed GE into a learning organization. He did not believe in punishing mistakes and failures. He wiped out the NIH (not invented here) idea practiced in GE. This arrogance prevented GE from taking other's ideas just because it is invented outside the company. Welch said people should always be open to better ideas anywhere anytime. He even invited other CEOs to address his managers.

His globalization strategy had 3 phases: export products, set up plants abroad and set up R & D units abroad and hire local talents.

Welch's vision was to make GE the most competitive enterprise on the planet and he stressed that all leaders (he preferred managers to address as leaders) must articulate a vision, set a goal and try hard to make that a reality - also vision should be simple, customer-focused and enhance self-confidence. So he started the legendary Six-Sigma process - a quality improvement initiative of producing error-free products and processes 99.9997% of the time i.e. fewer than 4 mistakes per million. This later turned to be one of the world's most practiced quality improvement programme.

He also started the process of digitization (e-Initiative) of the entire company encompassing all of GE's businesses to increase speed as he believed speed and quality are the most competitive differentiators. This e-Business initiative saved over $I billion in operating margin of GE in 2001 and $1.5 billion in cost savings. Also it helped GE to directly reach its customers without any intermediary and thereby increasing the potential of customer satisfaction.

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* Contributed by -
Priyanka Ghosh,
PGP 2003 -2005,
XIM Bhubaneswar.