CEO Insights From Jack Welch, Former CEO, GE And Current Serial Entrepreneur
I was lucky enough to spend some time twice with Jack Welch, former CEO of GE and the one largely credited for the tremendous growth GE experienced during his tenure. The first time was about 15 years ago when he was at GE and I was managing the Midwest for Home, Metropolitan Home and Elle Decor Magazines. The second was a couple of months ago at Mega Partnering 8. He said he remembered me, but I think he was just being polite.
Interestingly enough, although his success grew, the messages and principles that he impressed upon me, then as the CEO at GE and now as a serial entrepreneur, were almost exactly the same.
The other thing that has not changed is his energy level. While most former successful CEO’s are content to play golf and do other things to occupy their days, he is even busier now than the first time I met him.
Currently, he owns a piece of several companies, most of which are start-ups. His focus is on growth.
Growth is the elixir of life. As a small company, you can never take your eye off growth.
Most small companies fail because the idea isn’t good enough. The idea isn’t differentiated enough. A big company has enough room for slop. It’s an easier job.
That isn’t true anymore. More people in their 50’s are starting businesses than ever before.
- A clear mission. The CEO needs to know where we are going.
- A Set of Behaviors. He needs to know how we are going to get there. It is important that he gets in the skin of every single person and knows how to inspire and motivate him or her.
- There is a generosity gene you need to have to where you take care of your people. Good CEO’s need to give raises, promotions, and give as many as they can stock options. etc.
- I drew an x/y axis and put everyone in one of 4 boxes:Box One – Upper Left. These are my high performance, high value, key peopleBox Two – Bottom left. These are low performance, low value people. Get them out.Box Three – Upper Right. These are high values, low performance people. They deserve a second chance.Box Four – Bottom Right. These are high performance, low value people. This is what kills companies. Get rid of them.
Additionally, if your people don’t know where they stand with honest appraisals, you have no right to be a leader. All my people always know exactly where they stand.
The cheapest dollars you will ever spend are severance dollars. Be as generous as you can and be as nice on their way out as you can and know that is was your fault for bringing them in.
An “A” Player has the behaviors you define. Getting it done is important. Performance is important. An “A” Player must have both
A “B” Player has the behaviors, but doesn’t quite deliver. A “B” Player can be turned into an “A” Player.
Talk about the value of candor in your company. If you pick candor as a value, you become an “A” Player. It should filter down to every employee. You have to be up front regarding behaviors.
The team that acts like a team and fields the best players wins. Do candid appraisals 4X a year. Here is what I like… Here is what I think you can improve on.etc.
The top 3 qualities in an “A” player are, candor, passion, caring about the company, people and product.
It needs to be number one. You need to talk about where you are going and how you are going to get there. Here is why. Here is the competitive playing field.
Everyone from the bottom to the CEO better know the playing field. The CEO needs to put it in front of everyone all the time.
He constantly has to let his people know. He needs to go into the field and have everyone go into the field.
Getting everyone engaged and in the field needs to be a huge part of the planning process.
Does everyone know where he or she stands? Your employees need to know.
Your employees should know what their trajectory is. If they do these things for you, you will do these things for them.
4 E’s and a P. Energy, Energize, Edge, Execute (get it done) + Passion
Business is a game. Play it straight. Celebrate every success. Get yourself into the winning locker room. Winning is great. Get everyone excited.
Find a better way every day to do your job. Somebody is always doing it better than you. Find out where that is.
Knowledge is there, you just have to ask or get outside of your office to find it.
You can grow or you can swell. Swelling is not good for anyone. Once the head gets bigger than the wallet, it’s a disaster.