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5.0 out of 5 stars
Well-Integrated Overview of Jack Welch's Philosophy for GE, 11 May 2004
Most articles and books about Mr. Welch overly segment his thinking. As a result, you miss the core for the details. Mr. Heller has overcome this problem, and puts the individual elements of what GE has done under Mr. Welch into a useful perspective. The book also contains helpful exercises for applying these concepts to your business.Mr. Welch is a master of focus. He took GE and turned its attention to the most significant opportunities. This was accomplished both by drawing attention to certain areas, and by eliminating many others. Mr. Welch's great strength is that he is open to and hungry for new ideas. As a result, his thinking has improved a lot from the beginning of his tenure as CEO. A modest weakness of this book is that it doesn't say enough about how the later ideas sometimes contradict the earlier ideas. For example, the book shows that Mr. Welch was always focused on cost-cutting. In the beginning, he often did this in the most brutal way . . . with massive layoffs. Only very late in the game did he discover the quality processes that produce larger and more valuable cost reductions. Such quality processes flourish when employees have stable employment and the focus is on improving their knowledge and autonomy. Yet, the concepts of Six Sigma were well known early in his tenure as CEO. Perhaps GE needed to been even more eager for new ideas than it has been. On the other hand, GE seems to have been effective in adapting to the Internet in a timely way. The book is organized around the following principles: (1) Turning managers into leaders (2) Using everyone's thinking in the enterprise (3) Moving ahead faster than competitors in meaningful ways (4) Expanding stock price more rapidly than earnings (5) Using new trends the influences to your advantage. These concepts are then translated into practices for you to use in three master classes: (1) Exercising leadership (2) Changing company culture (3) Breaking boundaries and limitations. This book will be most useful to companies and leaders that are in many businesses, have a lot of bureaucracy and rigidity, and are not in high growth areas. The examples are almost all drawn in ways that are relevant to those problems. On the other hand, the idea of focusing is useful for any business. My main disappointment in the book is that it did not address GE Capital, which has been the source of most of GE's success under Mr. Welch. Mr. Heller draws extensively on the primary books about Mr. Welch that preceded this one. Unless you want a lot more detail, you will not need to read those. There is a bibliography to help you find them in case you decide you do want to read them. After you examine this situation, I suggest that you take Mr. Welch's observation seriously that he did not move fast enough. If your company is going to be operating as well as it possibly can in five years, what changes have to be made before then? How can you get through these needed changes in the fastest, smoothest way? The future environment will probably not allow you to take as long to change as Mr. Welch had. Focus on the places where leadership can make the most difference!
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