It is about Jack Welch's leadership at GE. Initiatives taken by him by which GE became what today it is! PPT made from HBR case "GE's two decade of transformation: Jack Welch's leadership" To get the copy of the ppt, send a request mail at mrudangpharma@gmail.com

1. GE’s Two Decade Transformation:
Jack Welch’s Leadership
Mrudang Thakor
LOGO

2. LOGO
Content
1. GE- Overview
2. All about- Jack Welch
3. Initiatives taken by Jack Welch
“Hardware” “Software”
Initiative Initiative
• #1 or 2 Fix, •Work Out
Sell/Close •Best Practices
•Three Circle •Go Global
Concept •Develop Leaders
•De staffing process •Boundary less Behavior
•Notion of stretch
•Strategic Planning
•Six Sigma
system

3. LOGO
1. GE- Overview
Founded -1878, Thomson Houston Electric
Company (THEC)
Merger- 1892, Between GE and THEC 
Formed General Electric
Headquarters: Fairfield, Connecticut, U.S
Revenue: US$ 147.300 Billion (2012)
Source: Wikipedia

4. LOGO
1. GE- CEOs (Since 1973)
Jack Welch (1981-2001)
Reg Jones (1973-81)
Jeffrey Immelt (2001- Present)

5. LOGO
2. All about Jack Welch
 John Francis "Jack" Welch, Jr. (born November 19,
1935), Peabody, MA
 Father: Conductor at Boston and Maine Corporation
 Mother: Home maker
 Alma- maters:
 Salem High school
 University of Massachusetts (Bachelor of Science in Chemical
Engineering, 1957)
 University of Illinois at Urbana-Champaign (M.S and PhD, 1960)
Source: Wikipedia

6. LOGO
Challenges for Welch as CEO
Matching and surpassing the standards set
by his predecessor Reg Jones.
 CEO of the year (3 times)
 CEO of the decade (1979)
 “Management Legend” (WSJ-1981)
Economy in recession (1981)
Strong Dollar  Highest Unemployment
rates

7. LOGO
Youngest CEO in action…
Initiatives by Jack Welch
“Hardware” “Software”
Initiative Initiative
•#1 or 2 Fix, •Work Out
Sell/Close •Best Practices
•Three Circle •Go Global
Concept •Develop Leaders
•De staffing process •Boundary less Behavior
•Notion of stretch
•Strategic Planning
•Six Sigma
system

8. LOGO
Disciplined Destaffing
LEAN
Less no. of
“We don’t need the questioners &
checkers, thepeople,
nit pickers who bog down
bureaucracy &
the process…
Today each staff has to ask, “How do I
politics
add value?” How do I make people on
the line more effective and
DESTAFFING
competitive?.”
AGILE
Making
people
productive
and
competitive

9. LOGO
Real Time Planning
STRATEGIC PLANING REAL TIME PLANING
Five page strategy Play book
One page answers to five questions
1. Current Market Dynamics
2. Competitors recent activities
3. GE’s Response
4. Greatest competitive threat over 3 years
5. GE’s Planned response

10. LOGO
Benefits by “Hardware” initiatives
Number of
Employees 404,000 to 292,000
(1981-89)
$27.2 billion to $29.2 billion Revenue
(1981-85)
Operating
Profits $1.6 billion to $2.4 billion
(1981-85)

11. LOGO
Initiatives by Jack Welch
“Hardware” “Software”
“By mid 1988 the “Hardware” structure
Initiative Initiative
was basically in place. Now it was time to
• Fix, Sell/Close •Work Out
focus on organization’s “Software”. A
•Three Circle •Best Practices
company can boost productivity by
Concept •Go Global
restructuring, removing bureaucracy and
•De staffing process •Develop Leaders
downsizing, but it can not sustain high
•Strategic Planning
•Boundary less Behavior
productivity without cultural change.” •Notion of stretch
system •Six Sigma

12. LOGO
Work Out
1. An open discussion forum
2. Employee could give ideas and suggestions
Overview on business and get immediate responses to
it.
1. To design a process to get unnecessary
bureaucratic work out of the system.
Objective 2. To create the culture of a small company,
where all felt engaged and everyone had
voice.
1. Implementation team (24 Consultants)
2. Group of 40-100 employees
Implementation 3. Three day sessions
4. On the spot decision on 80% proposals.

13. LOGO
Best Practices
Learning from Focus more on
other how things
industries got done
Implementation
1. Productivity increase
Results 2. Managers realized the key focus areas of
business

14. LOGO
Go Global
Appointing Paolo Fresco as Head,
International Operations
Rampant acquisitions
Taking advantage of global economic slow
down.
 European Crisis- $17.5Bn
 Mexican Peso collapse
 Asian Economy Crisis (1997-98)

15. LOGO
Developing leaders for tomorrow
Keeping close tabs on top 3000
executives
Succession Planning
Improved packages/Stock Options
Training institute at Crotonville
360 Degree Feedback

16. LOGO
“A” Players
Energy Excited by ideas and attracted to turbulence
Energize Infecting everyone with enthusiasm for idea
“A”
players
Edge The ability to make tough calls
Execution Consistent ability to turn vision into results

17. LOGO
Performance Appraisal System
Rank Rating Reward
1 Top 10% TOP Stock Options
2 15% STRONG Stock Options
3 50% HIGHLY VALUED Training
4 15% BORDERLINE Improve or Move
5 Bottom 10% LEAST EFFECTIVE Weed out

18. LOGO
Boundaryless Behavior
 Removing the barriers among engineering,
manufacturing, sales and customer service.
 “Learning from others”
“We quickly began to learn from each other:
Productivity solutions from LIGHTING, Quick
response asset management, transaction
effectiveness from GE CAPITAL, Cost Reduction
techniques from AIRCRAFT ENGINES, Global
account management from PLASTICS.”

19. LOGO
Notion of “Stretch”
To set performance targets. “Using
dreams to set business targets with no
real idea of how to get there.”
Try to get people think of fundamentally
better ways of performing their work.
“Objective was to change the way targets were set
and performance was measured by creating an
atmosphere that asked of everyone, “How good can
you be?”

20. LOGO
Foray into Service industry
To reduce dependence on traditional
industrial products.
Biggest growth opportunity.
“In-site concept”
“We have changed the very nature of what we do for
a living. Today services account for two-thirds of our
revenues”

21. LOGO
Six Sigma Initiative
 Employees were dissatisfied with the quality of its
product.
 GE was operating at error rates 10,000 times the
six sigma quality level of 3.4 defects/million
costing $8-12 billion/year.
 Series of planning, resource allocation, review,
and communication meetings were done.
 Participation in initiative was compulsory, 40%
Bonus was tied with it.

22. LOGO
Implementation
Master
Green Black
Black
Belt Belt
Belt
Training – 4 weeks
Training- 6 weeks
Implementation-
in statistics, data Full time six sigma
5 Months project
analysis and other instructors.
aimed at improving
six sigma tools.
Quality.
1. 10Fold increase in life of CT scan X-ray
tubes
2. 62% reduction in time at service
Results
stations
3. 30,000 Six Sigma projects were
initiated a year.

23. LOGO
Summary of Initiatives

24. Mrudang Thakor, MBA (09892734547)
LOGO