The Jack Welch way of winning
Authors: Jack Welch and Suzy Welch
Publisher: Harper Business, 2005
ISBN: 978-0060753948, 384 pages
By Rolf Dobelli, Chairman, getAbstract
Jack Welch, former General Electric CEO and chairman, is a legendary corporate mentor. Fortunately for readers, this volume (which he wrote with Suzy Welch, his wife) provides a top-tier mentoring session. The book is well paced with a mix of you-are-here details and stories by one of corporate America's savviest minds.
Welch is honest about his mistakes and his successes. The manual's only shortcoming is the chapter on family-work balance, an area where Welch admits his weaknesses. Otherwise, his corporate policy discussions score an abundance of points. getAbstract highly recommends this book to senior executives and up-and-coming managers alike.
"How Are You Going to Win?"
Winning matters because success leads to happy companies and "creative and generous" employees, as well as opportunities, jobs and tax revenue. In your mission statement, declare how you are going to win the corporate game. That will force your company to make tough choices about allocating resources. What's more, the process of setting a strategy eliminates a major corporate trap: the fatal attempt to be everything to everyone at every moment. A solid mission statement provides a clear road map. Corporate values are its nuts and bolts. Be concrete about acceptable behavior and ethical guidelines. The scandals at Enron and Arthur Andersen occurred when corporate values became divorced from mission statements.
"Underneath It All"
A lack of honesty - "candor" - is the largest "dirty secret" in corporate circles. This does not refer to underhanded dishonesty. It applies to people who aren't straightforward and who hold back valuable information. Dishonesty derails ideas, initiative and growth. It undermines employee reviews because people don't get real information about their work. Candor pays big benefits. Honesty expands feedback by getting more people into the conversation. It speeds the flow of ideas. When less fluff and smoke intrude into a discussion, people address actual issues more quickly. Candor also reduces your costs by limiting mind-numbing meetings. Become a model of honesty. Derail polite but meaningless banter by rewarding candid employees.
Grades of Excellence
Not all employees are created equal. Winning managers appreciate the differences. Leaders' failure to differentiate between stars, average performers and laggards hurts the bottom line. Accurate "differentiation" of talents - with bonuses for outstanding people and departments - transforms mediocre corporations into outstanding companies. For years, GE maintained a few underperforming businesses for sentimental reasons. For 20 years, its central air conditioning division was only marginally profitable. It depended upon the installation services of inconsistent outside contractors. As a result, its market share was tiny and it made only marginal profits. Then GE set a firm rule: Its companies had to occupy the first or second slot in their market segments or get out. GE sold the air conditioning unit and moved its resources (people and money) to lucrative areas of the company.
Use a similar approach with your team. The stars represent about 20% of your workforce; the middle tier 70% and the laggards 10%. Celebrate the top tier with bonuses and praise. Give middle-tier staffers motivation, feedback and growth opportunities. This group represents most of your workers, your biggest challenge and your future pool of stars. The bottom tier, plain and simple, has to go. This may seem callous, but a consistent, objective system serves everyone over time because it allows no hidden agendas or misunderstandings about job status or performance goals...
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