Jack Welch biography - Shareholder Value, Six Sigma

VBM Thought Leader: Jack Welch

Shareholder Value, Six Sigma

Jack Welch: biography / resume / curriculum vitae

Jack Welch John Frances Welch Jr. was born in Salem, Massachusetts, in 1935. A 1957 University of Massachusetts graduate, with a B.S. in chemical engineering, Welch continued to pursue his education at the University of Illinois, with M.S. and PhD degrees in chemical engineering.

Jack Welch joined General Electric in 1960, and after only a year, he actually wanted to leave the company and take a job offer he had received from International Minerals & Chemicals. Welch was working as a junior engineer in Pittsfield, Mass., at a salary of $10,500, but he was simply unhappy -- partly due to the measly raise he was offered, as well as what he felt was GE's strict bureaucracy.

Although he felt under appreciated by his boss, Jack Welch obviously made quite an impression on Reuben Gutoff, a young executive who was one level higher than Welch. He took Welch and Welch's former wife Carolyn out, where they sat for 4 hours straight while Gutoff tried to convince Welch to stay. Gutoff was disappointed by Welch's upcoming departure, and promised him a different kind of bureaucracy, one with the dominating attitude of "small-company environment, with big-company resources."

Gutoff knew that Welch would be an important asset to the company, and tried his hardest to keep him onboard. Welch, and in turn GE, have Gutoff to thank for what became of the company.

Welch's steadfast rise to the top of the GE ranks was thanks to his aggressive marketing of the company's products and services. He was named vice-president in 1972, senior vice-president in 1977, vice-chairman in 1979, and became GE's youngest and eighth Chairman and CEO in 1981, as Reginald H. Jones' successor. First he introduced a strategy that demanded each division should set out to be the number one or two in its market ('fix it, sell it, or close it'). In the 90s Six Sigma became very popular, after Welch adopted it at General Electric.

During his 20-year tenure as CEO of GE, Welch has been credited with changing the corporation around, and inflating the company's market value from $12 billion in 1981, to approximately $280 billion in 2001.

Jack Welch's success as CEO of GE is in large part due to his tremendous leadership skills. Welch knew how to effectively communicate key ideas to the rest of the staff, not only by delivering messages, but persistently repeating them over and over, and ultimately driving the messages home. His concept of change was also aggressive, by clearly outlining what needs to change.

Welch's corporate culture is like no other; what he hated about the organization in his early days as a chemical engineer, is exactly what he transformed as CEO: the red tape and bureaucracy of the company. He changed that by making it an informal learning environment, which he liked to refer to as a "grocery store."

This informal approach allowed Welch to get to know his employees, interact with them, and get involved in all aspects of the business. Welch also prided himself on his personal touches, such as the handwritten memos sent to employees. But while he's known as personable and persistent, he is also renowned for being a hard and very demanding leader, which is why many employees have coined him Neutron Jack.

Jack Welch King of Shareholder Value
Whatever his tactics, the fact that Welch is one of the most successful business leaders of all-time is indisputable. He has swelled the market value of the company to a degree unmatched by any other CEO, an accomplishment not even Bill Gates, Michael D. Eisner or Warren Buffett could lay claim to.

After 40 years with GE -- 20 years of running the place -- Welch left his position as CEO at September 7th, 2001, to embark on a whole new journey: retirement. But not before serving as corporate consultant to a group of Fortune 500 companies, all in different industries.

He has written a memoir of his life experiences and business strategies in his book, Straight From the Gut published in September 2001.

Thanks to redefining corporate cultures, leadership skills, and introducing new approaches to business, Jack Welch surely made a major contribution to GE and to the business world at large.

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