Jack Welch

Jack Welch

Length: 1161 words (3.3 double-spaced pages)

Rating: Excellent

Open Document

Essay Preview

More ↓
Early life and career
Jack Welch was born in Peabody, Massachusetts to John, a Boston & Maine Railroad conductor, and Grace, a housewife.

Welch attended Salem High School and later the University of Massachusetts Amherst, graduating in 1957 with a Bachelor of Science degree in chemical engineering. While at UMass he was a member of the Alpha chapter of the Phi Sigma Kappa fraternity.

Welch went on to receive his M.S. and Ph.D at the University of Illinois at Urbana-Champaign in 1960.

Welch joined General Electric in 1960. He worked as a junior engineer in Pittsfield, Massachusetts, at a salary of $10,500 annually. Welch was displeased with the $1,000 raise he was offered after his first year, as well as the strict bureaucracy within GE. He planned to leave the company to work with International Minerals & Chemicals in Skokie, Illinois.

However, Reuben Gutoff, a young executive two levels higher than Welch, decided that the man was too valuable a resource for the company to lose. He took Welch and his first wife Carolyn out to dinner at the Yellow Aster in Pittsfield, and spent eight hours trying to convince Welch to stay. Gutoff vowed to work to change the bureaucracy to create a small-company environment.

"Trust me," Gutoff remembers pleading. "As long as I am here, you are going to get a shot to operate with the best of the big company and the worst part of it pushed aside." "Well, you are on trial," retorted Welch. "I'm glad to be on trial," Gutoff said. "To try to keep you here is important." At daybreak, Welch gave him his answer. "It was one of my better marketing jobs in life," recalls Gutoff. "But then he said to me--and this is vintage Jack--'I'm still going to have the party because I like parties, and besides, I think they have some little presents for me.'" Some 12 years later, Welch would audaciously write in his annual performance review that his long-term goal was to become CEO.[citation needed]

Welch was named a vice president of GE in 1972. He moved up the ranks to become senior vice president in 1977 and vice chairman in 1979. Welch became GE's youngest chairman and CEO in 1981, succeeding Reginald H. Jones. By 1982, Welch had disassembled much of the earlier management put together by Jones.

[edit] Tenure as CEO of GE
Through the 1980s, Welch worked to streamline GE and make it a more competitive company.

How to Cite this Page

MLA Citation:
"Jack Welch." 123HelpMe.com. 15 Dec 2019
    <https://www.123helpme.com/view.asp?id=160218>.

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Jack Welch : A Man Of His Vision Essay example

- Jack Welch was considered to be a man of his vision. He believed in his vision for GE and he passed that belief down throughout the company. He passion for his vision changed the culture and structure of GE. In this paper we will analyze how Jack Welch developed his strategic plan, how he used his personal, political and positional power to shape GE. We will also look at how Jack Welch organized, built and planned his teams in keeping with his vision. In the end will look at how this all affected the culture of GE....   [tags: Strategy, Management, Best practice]

Research Papers
1522 words (4.3 pages)

Jack Welch 's Leadership Style Essay

- As we’ve learned over the course of the semester the definitions and qualities of a good leader. We also discussed the best ways to handle and make an organization a competitor advantage in respective of what it does, and finally the assumption, understanding and implementation of change for the betterment of an organization. Jack Welch 's theories and ideas he discussed in the articles are not exempt from the lessons I learnt from the class. The paper will discuss Jack Welch 's leadership style, his ideas and actions that made him the greatest CEO of all time....   [tags: Management, Leadership]

Research Papers
1138 words (3.3 pages)

Jack Welch and the GE Way Essay

- Jack Welch and the GE Way      When Jack Welch was named CEO of General Electric, Welch saw a company in trouble even though the business world saw GE as an intrinsically healthy corporation, secure in its position as a world industrial leader. Welch knew that the company was too large to fail yet GE was too unwieldy to adapt for further growth. The changes he instituted restructured and revolutionized GE and made Welch the most respected CEO in business today. After reading the book there were three parts that really stood out for me....   [tags: Managing Case study business Essays, solution]

Research Papers
1597 words (4.6 pages)

Career Biography of Jack Welch Essay

- Career Biography of Jack Welch Management guru Jack Welch, former CEO of General Electric, has been instrumental in forming today’s top business management leaders by imparting effective knowledge in leadership management; he is widely credited with transforming GE into a multibillion-dollar conglomerate. I. Jack Welch – Who is the man. A. Biography – 1.Born in Salem, Massachusetts, in 1935. a. Growing up – The family lived in one of the poorer neighborhoods of Salem, Massachusetts....   [tags: General Electric Business Management Essays]

Research Papers
2767 words (7.9 pages)

Essay about Jack Welch: A Leader

- Jack Welch a great leader. As it is always stated, leaders are not always from birth but they are made too. Jack Welch is a glimmering example of the latter. The leaders also have high level of empathy, vision, ethics, hard working mentality and a respect for past. While going through the passage, it was found that Jack Welch’s immaculate leadership did have some flaws. Strength of any strong building lies in its foundation and so does leadership. It can be seen from the passage that Jack was very competitive and could not stand a raise of $1000, the same amount given to his colleagues and to prove this point he quit....   [tags: Biography]

Free Essays
1029 words (2.9 pages)

Jack Welch Essay example

- Jack Welch - Leadership Secret 1- Harness the Power of Change It is important in today’s changing economy that business leaders are not afraid to make necessary changes to succeed. When Jack Welch became CEO of General Electric in 1981, it was a lethargic business, satisfied with its output and entangled in bureaucracy. He understood the competition that overseas markets presented and the need for a new global strategic plan. He was able to envision the true potential of his resources and implemented drastic changes such as the Stretch, Work-Out, and Number One, Number Two business concepts (which will be discussed later) to achieve his goals....   [tags: GCSE Business Marketing Coursework]

Research Papers
2605 words (7.4 pages)

Essay about Jack Welch

- Jack Welch (CEO of GE) John F. Welch, Jr yang kemudian dikenal dengan nama Jack Welch lahir pada tanggal 19 November 1935 di Peabody, Massachusetts, dari keluarga buruh Katolik dan dibesarkan di Salem. Ayahnya bernama John Welch ( bekerja sebagai seorang mandor pada pembangunan rel kreta api ) dan ibunya bernama Grace Andrews. Welch adalah seorang yang berkebangsaan Amerika. Sebagai seorang anak dia menerima perhatian penuh dari orangtuanya secara khusus untuk hal-hal yang baik dan juga hal-hal yang terburuk....   [tags: Foreign Language Essays]

Free Essays
1464 words (4.2 pages)

Essay about Jack Welch

- Early life and career Jack Welch was born in Peabody, Massachusetts to John, a Boston & Maine Railroad conductor, and Grace, a housewife. Welch attended Salem High School and later the University of Massachusetts Amherst, graduating in 1957 with a Bachelor of Science degree in chemical engineering. While at UMass he was a member of the Alpha chapter of the Phi Sigma Kappa fraternity. Welch went on to receive his M.S. and Ph.D at the University of Illinois at Urbana-Champaign in 1960. Welch joined General Electric in 1960....   [tags: GE General Electric CEO]

Free Essays
1161 words (3.3 pages)

Essay about Jack Welch

- Jack Welch was born on November 19, 1935 in Salem, Massachusetts. After graduating high school, he studied at the University of Massuchusetts and received a bachelor's degree in chemical engineering in 1957. He immediately moved to Illiois, where he receive his Master's degree and Ph.D. in chemical engineering. In 1960, Jack started working at General Electric for a starting salary of $10,500. He was very unhappy working for GE due to the low wages and the bureaucracy of management. When Reuben Gutoff, an executive above him, learned that Jack was thinking of leaving GE, he took him out to dinner and convinced him to stay after a four hour conversation....   [tags: essays research papers]

Free Essays
447 words (1.3 pages)

What Makes Jack Welch an Effective Leader? Essay

- What Makes Jack Welch an Effective Leader. ---ideas from the article “Will Legacy Live On?” Before I talk about what makes Jack an effective leader, I want to explain briefly why I chose him as my study subject. Why do I like him. Jack Welch created a new model for business leaders everywhere. His genius leadership and management techniques are an example to anyone aspiring to a successful career. Why is he so famous. He became the youngest CEO and Chairman of one of America's biggest and most respected companies (General Electric) at age 44, and successfully rewrote the rules of what an incredibly profitable and successful company should be, and had fun in the process....   [tags: GCSE Business Marketing Coursework]

Research Papers
966 words (2.8 pages)

In 1981 he made a speech in Hotel Pierre, New York City called ‘Growing fast in a slow-growth economy’ (8.12.1981).[2] This is often acknowledged as the "dawn" of the obsession with shareholder value.

He also pushed the managers of the businesses he kept to become more productive. Welch worked to eradicate inefficiency by trimming inventories and dismantling the bureaucracy that had almost led him to leave GE in the past. He shut down factories, reduced payrolls and cut lackluster old-line units. Welch's philosophy was that a company should be either #1 or #2 in a particular industry, or else leave it completely. Although he was initially treated with contempt by those under him for his policies, they eventually grew to respect him. Welch's strategy was later adopted by other CEOs across corporate America.

Each year, Welch would fire the bottom 10% of his managers. He earned a reputation for brutal candor in his meetings with executives. He would push his managers to perform, but he would reward those in the top 20% with bonuses and stock options. He also expanded the broadness of the stock options program at GE from just top executives to nearly one third of all employees. Welch is also known for destroying the nine-layer management hierarchy and bringing a sense of informality to the company.

During the early 1980s he was dubbed "Neutron Jack" (in reference to the neutron bomb) for eliminating employees while leaving buildings intact. In Jack: Straight From The Gut, Welch states that GE had 411,000 employees at the end of 1980, and 299,000 at the end of 1985. Of the 112,000 who left the payroll, 37,000 were in sold businesses, and 81,000 were reduced in continuing businesses. In return, GE had increased its market capital tremendously.

In 1986, GE acquired NBC, which was located in Rockefeller Center; Welch subsequently took up an office in the GE Building at 30 Rockefeller Plaza. During the 1990s, Welch helped to modernize GE by shifting from manufacturing to financial services through numerous acquisitions.

Welch adopted Motorola's Six Sigma quality program in late 1995. He led the company to massive revenues. In 1980, the year before Welch became CEO, GE recorded revenues of roughly $26.8 billion. In 2000, the year before he left, the revenues increased to nearly $130 billion. When Jack Welch left GE, the company had gone from a market value of $14 billion to one of more than $410 billion at the end of 2004, making it the most valuable and largest company in the world.

At the time of his retirement, Welch received a salary of $4 million a year, followed by his record retirement plan of $8 million a year. In 1999 he was named "Manager of the Century" by Fortune magazine.

There was a lengthy and well-publicized succession planning saga prior to his retirement between James McNerney, Robert Nardelli, and Jeffrey Immelt, with Immelt eventually selected to succeed him as Chairman and CEO. Nardelli became the CEO of Home Depot until his resignation in early 2007, while McNerney became CEO of 3M until he left that post to serve in the same capacity at Boeing.

[edit] Criticism
Some industry analysts claim that Welch is given too much credit for GE's success. They contend that individual managers are largely responsible for the company's success.[3] For example GE Capital, under Gary C. Wendt, contributed nearly 40% of the company's total earnings while NBC and Robert C. Wright worked to turn the network leading to five years of double-digit earnings growth. It is also held that Welch did not rescue GE from great losses as the company had 16% annual earnings growth during the tenure of his predecessor, Reginald H. Jones. Critics also say that "the pressure Welch imposes leads some employees to cut corners, possibly contributing to some of the defense-contracting scandals that have plagued GE, or to the humiliating Kidder, Peabody & Co. bond-trading scheme of the early 1990s that generated bogus profits".[4]

Welch has also received criticism over the years for an apparent lack of compassion for the middle class and working class. Welch has publicly stated that he is not concerned with the discrepancy between the salaries of top-paid CEOs and those of average workers. When asked about the issue of excessive CEO pay, Welch has stated that such allegations are "outrageous" and has vehemently opposed proposed SEC reforms affecting executive compensation. Countering the public uproar over excessive executive pay (including backdating stock options, golden parachutes for nonperformance, and extravagant retirement packages), Welch stated that CEO compensation should continue to be dictated by the free market, without interference from government or other outside agencies.[5] In addition, Welch is a vocal opponent of the Sarbanes-Oxley Act of 2002.[6]
Return to 123HelpMe.com