I lived the prodigious decade of Jack Welch

In 1981, when John F. Welch became the eighteenth CEO and President of GE , no one suspected that a new management style would be implemented in many listed companies in the world.

Reached that position with 45 years old. No one had reached the top of GE so young.

Born late 1935 in Massachusetts and the first member of his family who went to college, is masters degree in engineering from the University of Illinois at 1959 and a year later a doctorate in chemical engineering from the same university.

He began his career at GE in 1960 as a chemical engineer and never gave the company until his retirement, although still active as the attached video shows. (Note.- WOBI This video is not supported on iPad / iPhone)

His early work in GE were developed in the chemical, specifically in the production of polymers. En 1968, with 33 he became the youngest CEO of GE, his department produced Noryl and Lexan plastics. En 1971 ya era General Manager oInthe Chemical and Metallurgical Division. From here his career was meteoric. He foresaw the great development of Medical Systems thanks to the scanners, y siendo Vice President of Consumer Products and Services Sector apostó por expandirse en el sector financiero donde GE Credit, later renamed GE Capital, reached more growth and profitability of the Company.

His ambition and timing made him the most entrepreneur of his time.A pro-entrepreneur from his position within the corporation, an entrepreneur in a big, thinking big. Unlike the sense that today we use and abuse of the concept of entrepreneur as a creator startups. That is why in 1980 was announced as the successor of then CEO Reginald Jones, thus taking the maximum liability of the largest industrial company in the world.

Here began a new Management moved from theory to implementation, implemented and would be admired, imitated and revered by all sectors including academic enterprise.

But the most impressive was his ability to multiply numbers. Eighties The GE doubles turnover up 54,6 billions (Americans billions) dollar, with profit nearly triples to the 3,9 billones de dólares, operating margin pasa el del 9% to the 11,3% and, attention!!, the amount of market value 12 a 5billiones. A icon of entrepreneurial capitalism had consolidated. Jack Welch was the new business guru.

The eighties became the source of a strong development of business schools in the U.S., that would expand in the next decade Spain, of gurus management proliferate inventing theoretical concepts, procedures and books, many books, and consultants.

Because the largest business consultants arising at this time. Welch was able to meet with the top. The most important of these was Peter Drucker (1909-2005), of who tells a story with Welch, when asked: “Jack, if you were not in this business, You could get away from him??"Because Welch launched his famous trial for all GE business: "If not in first or second place in the sector, that business should restructure, be sold or closed ".

This approach led to a huge effort of all directors of GE to be on top of your industry, while a huge investment amounts demanded processes and machinery for the units to accommodate these parameters.

Alongside another of his innovations was the celebrated staff selection: each unit in the 20% outstanding should be promoted, the 70% Central and maintained 10% fired less efficient.

Also distributed among managers for the worst layoffs and substantial bonus and stocks-options for Achievers commitment. All numbers increased from less headcounts. This earned him the nickname "Neutron Jack", in reference to the neutron bomb annihilating employees.

A rapid growth occurred in most GE businesses, were additionally hundreds of new acquisitions to position the leadership in practice, treatise beyond.

If the eighties was the growth ramp, the nineties was the cultural change at GE. Welch had the courage to launch as mission to increase shareholder value and as of minkboundaryless organization, to eliminate all barriers to communication, diversity, cooperation and global development. Also here is implanted GE pioneered the practice.

New processes were developed to unify the vast empire GE and culture. And to minimize bureaucracy. “We hate burocracy” was said in those years within the organization when some were to find that she was still prevail.

These were years of systematic application of “Work-out”, of “Leadership ", of “Six-Sigma”, of the “Core Values”

Six-Sigma Process, aspiring to obtain less than 3,4 defects per million operations, was especially important in all GE units. Most shocking was that Welch introduced 1995 this concept for all functions, from marketing to production, and HR through technology. And all employees from a level close we were to pass the courses and make a project to be certified. This was to eliminate quality defects on all products, services and processes of the Company, thereby saving 1,5 trillion in 1999. The company reported that forecast and the stock rose and rose. Each ad led to a higher market value, como Welch ansiaba.

At the end of the decade of the 90 GE reconfirmed their expectations, in this case the expected savings via Six-Sigma and continually kept rising actions.

But the passion for quality did not stop there. The gurus of the time had already launched the concept in vogue: “Customer Focus”, Welch and adapted it to their form, not forget that he was an engineer. It was found that customers were more interested in Six-Sigma quality if it was to their obvious benefits to their business. Welch and / or their consultants got the message and launched a pioneering design process of new products and services call “Design for Six-Sigma” (DFSS), which conveniently seasoned communications market once again led the prestige, reputation, leadership,Rise ... and the value of the shares of GE.

Welch never ceased to shake the market with their ideas, their creations, their paradigms,. At the end of the last century defined its new vision of GE in the XXI century as "a global services company, also sells high quality. "Perhaps he was influenced by GE Capital that ultimately 1998 contributed by the 40% GE profit or takeoff and business computing. com era.

The result strongly boost practice these and other concepts such as widespread globalization of R & D with the creation of impressive John F. Welch Technology Center (JFWTC) en Bangalore (India), the corporate culture, IT development, internet, e-Business, and new processes workflow on the intranet, etc., materialized in new growth opportunities and cost reduction.

In 1999 Welch ended the twentieth century with the shareholders at the Annual Meeting in Cleveland. Ohio, reporting more than 100 billion in revenue, above 10 benefits trillion, with one operating margin also rose dramatically to 16,7%, and a market capitalization greater than 500 billion.

Welch had met and exceeded milestones of roadmap, paradigmatic words as used in the Company.

Some concepts of social responsibility also had advanced: programs volunteering, the ombudsperson in each unit of GE, the absence of any discrimination for any reason, the meritocracywith the annual assessment Employee Management System (EMS), policy integrity, etc..

GE was in every way as the Most Admired Company according to several of them and for two consecutive years in Fortune.

Jack Welch was nominated for four consecutive years “Most Respected Executive of the Year” as Fortune.

In July 2000, close to retirement, Madrid came to interviewing the then Deputy Prime Minister Rodrigo Rato. No lacked time for your Spanish directors, with those who had an interesting meeting at the Palace Hotel suite.

GE Welch still lived in the beginning of the new century, until 2001 that ceded his empire to Jeff Immelt, who currently pilots the company but without the charisma of Welch, who went down in history as an executive of American capitalism hardly repeatable industrial enterprise under real economy.

In 2009 founded the Jack Welch Management Institute,considered where the best manager of all time is still active.

Coautor junto a su hija Suzy del interesante libro “Winning”(2005) que recomiendo a todos los profesionales del Management.

Self-reflection:

• Twelve years later, Do you think the impacts and consequences of culture Welch extended to ManagementCorporate has a totally positive balance or find any questionable aspect?
• How sustainable is the preeminent mission “shareholder value”?
• The personnel policy with significant rewards and punishments, Create excessive internal competition??Are they sustainable in the current environment?
• Is it right for a large corporation requiring each unit that is first or second in the ranking sector?
• The GE cited social progress in those, Are they real or just to improve the image to investors?