Jack Welch: “Straight from the Gut”

“You punk, if you don’t know how to lose, you’ll never know how to win. If you don’t know this, you shouldn’t be playing.” – Grace Welch

Jack Welch claims that his biggest influence in life came from his mother in the form of those words. When he lost a game of hockey at an early age of 11 and threw his hockey stick across the ice, his mother pushed her way into the boys locker room and severely scolded him. In that locker room, she taught him the value of competition, the pleasure of winning and the need to take defeat in stride.

The ultimate manager, leader, business role model went on to win often and big in his rising career in GE. Jack’s story is one of a kind. He is a role model for true capitalism and entrepreneurship and a living example of just how much one single person can achieve and what an astounding difference an individual can bring about. His ambition to move up the ladder in GE was brutal, calculated, and unmistakably hard to beat. With his Irish disciplined upbringing and the hardship of his parents always on his mind, he was equipped with much perseverance and ambition to supplement his success.

“Straight from the Gut” is largely a biography of Jack’s career but it could also be read as a business book comprised of stories of Jack’s corporate life and leadership. He hardly discusses any aspects of his personal life; he seems supremely detached to it rather than private about it. I am always foremost curious about the human being behind the leader. Albeit sparse, the accounts of Jack’s personal life show a man who is passionate about his work and his game. During the course of his 20 odd year GE career, few things concern him outside the top performance of GE and his golf game – and he goes into great lengths of detail no doubt on both subject matter. He marries and divorces 3 times, fathers 4 children, and rarely allows the ups and downs of his chaotic private life enter his business world. I am feeling undecided as to whether I am paying him a kind compliment or a mild criticism in this regard.

Sometimes, books have an effect on me days or weeks after I have finished reading them. With “Straight from the Gut”, I realized this uneasy aftertaste of the book a few weeks later. From all that I knew about Jack prior to the book combined with the excellent example he sets for GE, I considered him to be the ultimate visionary leader, and a visionary as someone who looks at the present corporate environment and builds toward the ideal environment that it should be. The sharp contrast between his vision for the business and lack of it for its environment is obvious in the make-up of his leadership teams at GE throughout his tenure. The make-up of his senior executive staff and senior management always consisted entirely of 40-plus-year-old married white males!

I am a believer of the best person for the job, and if the best consisted only of this class, then perhaps it is some 20 odd year coincidence across many departments of GE. Or perhaps, the vision of the best person for the job in Jack’s mind, reinforced by culture and tradition, was the ideal happily married white business man. Perhaps they were indeed the best at the time, for the nature of the beast which operated in such a way that lack of consideration afforded to their women or minorities counterparts hardly presented them with the opportunity. The question is not whether Jack chose the best person for the job. He nearly always did, and if he did not, he learned from his mistakes and rectified the situation immediately. The question is why a visionary like Jack lacked vision for selecting the best leaders from all possible pools of candidates and why his close-knit executive team could not foresee beyond the 1980s corporate structure and provide early opportunities for another kind of star.

This book, consisting of excruciating details of GE’s challenges, takeovers, Mergers & Acquisitions, plant shut-downs, negotiations, hiring and firing of employees, it makes for a long read. When you finish reading it however, you feel as though you walked out of a leadership class in GE given by Jack. What would that class be like if we were to drop in? Perhaps you would hear some of these quotes from Jack Welch.

1. Integrity – “Number one in being a good CEO. To establish it and to never waver from it.”
2. Meritocracy – Rewarding those who perform, abandoning those who do not. Operating within the bounds of true meritocracy at the core of GE.
   “If you do not take care of your top performers, and if you slice up your pie to give to all equally, your best performers leave. Where does that leave you? It is no longer a growing environment that feeds their needs.”
3. Owning the people – “You own the business. You are renting the people. Share your best people across the company”.
4. Striking the right balance – “Managing loose, managing tight. When to meddle and when to stay out, and knowing the difference.”