Jack Welch’s Leadership Essay Example

prioritized developing leaders. The achievement of this objective was facilitated by utilizing session C, an updated compensation package, the Crotonville facility, and a 360o feedback process.

Based on the previous foundation, Welch strived to transform GE into a boundary-less company, with a focus on services business. In his later stage at GE, Welch remained enthusiastic and implemented the six-sigma method to enhance quality. To ensure a legacy of quality for his successor, he persistently improved quality throughout the organization by retaining top talent and eliminating unqualified individuals. Additionally, Welch demonstrated foresight by establishing E business. Ultimately, Welch successfully transformed GE into an exemplary company for the world.

Welch’s success can be attributed to various factors, which are evident through three different lenses of organizational process and behavior.
From a strategic perspective, GE's corporate structure underwent significant changes over time. It was highly centralized in the 1930s but began decentralizing in the 1950s. The concept of "profitless growth" emerged in the 1960s, leading to the establishment of a planning system that strengthened the corporate staff. In 1973, Reg Jones restructured the company into 43 strategic business units to support strategic planning, which became a vital aspect of GE's management process.

In 1977, GE introduced the layer of sectors to handle the review burden. However, when Jack Welch became CEO in April 1984, a recession was occurring. To enhance performance across GE's portfolio, Welch restructured the entire company in 1985. One significant change he made was eliminating sector levels and establishing direct reporting from all business units to him. This strategy of downsizing, destaffing, and delayering resulted in a substantial profit increase from 1.6 billion

to 2.4 billion. This demonstrates that a crucial factor contributing to their success was making timely and appropriate adjustments to their organizational structure.

The organization structure serves as the foundation for all organization activities. It determines the functioning and growth direction of the entire organization. A well-suited structure, aligned with the company's strategy, can facilitate overall development by eliminating resistance caused by inappropriate structure. Prior to Welch's tenure, GE predominantly had a functional structure, which later transitioned to an SBU-based structure. Eventually, innovation was incorporated at the sector level.

GE's growth is effectively supported by their ability at each stage. Welch's primary objective when he took over leadership was to restructure the company, which involved implementing radical ideas. If GE had maintained its bureaucratic structure, progress would have been unattainable for Welch. As a result, he simplified the entire organization and eliminated sector levels, making the company more flexible and adaptable overall. In addition to being seen as a tyrant or ego-centric individual, Welch also possesses a strong determination.

Despite his unsuccessful attempts to establish power, Welch employed different political strategies throughout the process. In the beginning, he engaged influential individuals from the start of work-out development, allowing them to collectively shape the concept. This approach helped him gain support from others. During the execution phase, he started with a small implementation team before introducing the program to the entire company. This strategic move aimed to reduce potential risks for the organization as a whole and demonstrated his political acumen.

During the effort to globalize GE, GE's CEO Jack Welch appointed Paolo Fresco as the head of International Operations. In 1992,

Welch elevated Fresco's position to vice-chairman and included him as a member of his four-man corporate executive office. Welch provided significant support to Fresco and granted him sufficient power, which proved beneficial in implementing an important strategy throughout the entire company. Additionally, Welch's political influence attracted external resources. In 1995, when faced with quality complaints from employees, Welch enlisted the help of his longtime friend Lawrence Bossidy to establish a six sigma system.

Political power has aided Welch in garnering support from both internal and external sources, allowing him to gradually establish his authority and successfully implement his strategic plan throughout the entire company. One crucial aspect Welch focused on was the cultural element. He made sure to address any cultural concerns by clearly expressing his stance within the company or publicly. This ensured that all employees could align themselves with the same vision. Moreover, Welch understood the importance of reinforcing cultural development through repetitive storytelling. As part of his goal to turn GE into a boundaryless organization, he purposely recounted the story of a small appliance plant in New Zealand being situated in Canada.

Using narratives instead of slogans is a more effective way to spread propaganda because people are naturally drawn to stories. Moreover, he actively participated in cultural improvement to set an example and directly influence others. Involving top-level management is usually a significant step towards achieving this cultural development. When transitioning from a company-focused ideology to a service-oriented business model, he appointed a team of competent executives to address the problem. By utilizing key individuals, ideas from top management can be successfully implemented at all levels within the organization.