Jack Welch and His Story

Welch joined General Electric in 1960, when he worked as a junior engineer in Pittsfield, Massachusetts. When he was not satisfied with the salary increase received and the existing bureaucracy within GE. He planned to leave the company to work with International Minerals & Chemicals in Skokie, Illinois. However, Gutoff Reuben, a young executive two levels above him, decided that Welch was too valuable to be released. He took Welch and his wife in a dinner at the restaurant Yellow Aster and spent many hours to convince Welch to stay. Gutoff promised to change the existing bureaucracy and create the feel of a small company in GE. Welch was appointed vice president of GE in 1972. His career rose to be senior vice president in 1977 and vice chairman in 1979. In 1981, Welch became GE's youngest chairman and CEO, succeeding Reginald H. Jones. In 1982, Welch had disassembled much of the management by Jones.

Bomb Jack Nutron
During the era of 80s, Welch worked to streamline GE and make it a more competitive company. He also encourages the managers of the businesses managed to become more productive by eliminating inefficiencies and cut inventories, and removed the bureaucracy that almost led him to leave GE in the past. He also had the nicknamed "Neutron Jack" (like the neutron bomb) for eliminating employees and leaving the building empty. In his book "Jack: Straight from the Gut" (Jack: Establishment and Courage), Welch said that GE previously had 411 thousand employees in late 1980, and became 299 thousand at the end of 1985. A total of 112 thousand employees who removed, 37 thousand of them are because the business was sold, and reduced over 81 thousand business operation. In contrast, GE has increased its market value rapidly. He was a lot of closed factories, reduced costs and cutting salaries of slow business unit running. Philosophy was that every GE business to be in position one or two in a particular industry, or will be abandoned. Although he was initially opposed because of his policies, but in the end he got respect. Welch's strategy was eventually adopted by many other Chief Executives. Each year, Welch would lay off the bottom 10% manager. He is famous for its frankness in executive meetings. He really pushed his managers to go, but he also gives bonuses and rewards of ownership of shares in 20% of its top managers.

Ownership program at GE also developed from only the top executives to nearly two-thirds of the employees. Welch is also known for destroying 9 layers of management and invested in the company's informality.

Strategy and the results
In the year 1986, GE acquired NBC, which is located in Rockefeller Center; Welch subsequently took up office in the GE Building at Rockefeller Plaza. During the 1990s, Welch helped to modernize GE by shifting from manufacturing to financial services through numerous acquisitions. Welch adopted the Six Sigma quality program from Motorola in late 1995. He led the company achieve a great income. In the year 1980 before Welch became CEO, GE recorded revenues of approximately 26, 8 billion U.S. dollars, in 2000, one year before he left, revenues increased to 130 billion dollars. When Jack Welch left GE, GE's market value had gone from 14 billion dollars to more than $ 410 billion at the end of 2004, making it the most valuable company and biggest in the world.

Early retirement and succession
At the time of his retirement, Welch received a salary of $ 4 million per year, followed by the value of a pension of $ 8 million each year. In 1999 he was named "Manager of the Century" by Fortune magazine. Welch's announced succession to Jeff Immelt in the same way his predecessor Reg Jones. He wrote this story in his book "Jack: Straight from the Gut" (Jack: Establishment and Courage). This succession process where there is a long walk 3 replacement candidates are James McNerney, Robert Nardelli, and Jeffrey Immelt, who eventually became his successor. Nardelli became CEO of Home Depot until the year 2007, while McNerney became CEO of 3M before moving into the CEO of Boeing.