Ge Ceo Quotes

Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.” —Jack Welch, author and CEO of GE from 1981-2001

If I had to run a company on three measures, those measures would be customer satisfaction, employee satisfaction and cash flow. ” Jack Welch, former CEO of GE

General Electric, one of America’s largest corporations, made $14,200,000,000 in profits in 2010 and paid $0 in taxes—that’s right, fourteen BILLION dollars in profits, zero dollars in taxes. Jeffrey Immelt, GE’s CEO, doubled his own compensation package, and at the same time, is asking 15,000 of their unionized workers to make major concessions in wages and benefits.

While Immelt said that he encouraged debate, meetings often lacked rigorous questioning. One executive recalled being in a board meeting in which Keith Sherin was presenting the quarterly financial results to the group. The Power business had missed badly, but little specific detail was provided on what went wrong. This executive braced for the reaction from the directors, but it never came—none of them asked what went wrong. When Flannery committed to renewing and shrinking the board of directors, it included half a dozen current or former CEOs, the former head of mutual fund giant Vanguard Group, the dean of New York University’s business school, as well as a former chair of the Securities and Exchange Commission. The seventeen independent directors got a mix of cash, stock, and other perks worth more than $300,000 a year. The terms had been even more generous when GE still made appliances; the company allowed directors to take home up to $30,000 worth of GE products in any three-year period. The company matched the directors’ gifts to charity, and upon leaving the board, a director could send $1 million in GE money to a charity. Some directors admitted to having been sold by Immelt’s sweeping optimism, even if they knew he wasn’t the best deal-maker. But they knew he had a hard job, was playing with a tough hand, and had survived multiple major crises. Plus, they liked him. Immelt said that he did his best to keep directors informed, noting that he required them to make trips to GE divisions on their own, but he also knew that the complexity of the business limited their input. As they’d done under Welch, the board usually tended to approve his recommendations and follow his lead. Some felt that Immelt manipulated the board, and it was whispered that members were chosen and educated to see the company through his visionary eyes. There was concern that the board didn’t entirely understand how GE worked, and that Immelt was just fine with that. Like many CEOs who are also their company’s chairman, he made sure that his board was aligned with him.

In the weeks and months after Immelt left GE in 2017, a parade of negative stories and embarrassing disclosures revealed major problems that sent the company’s stock into a long decline. Conversations about what happened inevitably shifted to blame, and Immelt was the obvious target. He had spent sixteen years at the top and, regardless of what Welch had left for him, he’d had plenty of time to fix it. But there was plenty of blame to go around. Perhaps most of it should be placed on the board of directors, the independent group that oversees the CEO. Board members claimed to have been unaware of problems and to have gotten bad guidance from external advisers, and they said they didn’t understand how the company went from good to bad seemingly overnight. Some directors had no experience in GE’s business lines, others had trouble staying awake during meetings, and many stumbled away from GE’s collapse wondering, How could we have known? It had been their job to know, however, and their job to ask the hard questions that weren’t fully answered, or were never asked at all. It was their job to oversee management, and it was their job to protect investors from fatal hubris. Still, the path ultimately leads back to Immelt. As chairman, he was also responsible for steering the board. There is no doubt that GE’s size and complexity, which grew exponentially under Immelt, made it difficult or even impossible to manage. The CEO of a company is responsible for its daily functions and for managing its operations, however vast. The chairman guides the board, which is responsible for overseeing management and the CEO. When the board chair and CEO are the same person, the top executive is essentially his own boss. It can only get worse with time if a chairman remakes the board to his own liking. Simply put, it is terrible governance to give so much power to a single person and so little voice to shareholders. That is one reason this governance structure has been slowly fading from corporate America since the Enron era.

The board had largely followed the chairman’s lead. One newcomer to the board under Welch was surprised by the CEO’s command of the boardroom and the sparse debate among the group. Confused by how the meeting transpired, the new director asked a more senior colleague afterward, “What is the role of a GE board member?” “Applause,” the older director answered.

just as a brilliant strategy is worthless unless it is implemented, a powerful strategic principle is of no use unless it is communicated effectively. When CEO Jack Welch talks about aligning employees around GE’s strategy and values, he emphasizes the need for consistency, simplicity, and repetition.

I didn’t have the benefit of having worked under both CEOs, but it dawned on me how deeply a CEO’s persona and focus can shape an institution. Most CEOs are very good at many things, but they become CEOs for being superbly distinctive at one or two, which tend to be matched to a company’s needs at that time. Even CEOs need to declare a major. Welch is best known for Six Sigma—a set of tools to improve quality and efficiency—and his focus on people. Immelt instead emphasized sales and marketing, most visibly through GE’s branded “ecomagination” efforts to make and be perceived as a maker of greener products.

General Electric was the largest company in the world in 2004, worth a third of a trillion dollars. It had either been first or second each year for the previous decade, capitalism’s shining example of corporate aristocracy. Then everything fell to pieces. The 2008 financial crisis sent GE’s financing division—which supplied more than half the company’s profits—into chaos. It was eventually sold for scrap. Subsequent bets in oil and energy were disasters, resulting in billions in writeoffs. GE stock fell from $40 in 2007 to $7 by 2018. Blame placed on CEO Jeff Immelt—who ran the company since 2001—was immediate and harsh. He was criticized for his leadership, his acquisitions, cutting the dividend, laying off workers and—of course—the plunging stock price. Rightly so: those rewarded with dynastic wealth when times are good hold the burden of responsibility when the tide goes out. He stepped down in 2017. But Immelt said something insightful on his way out. Responding to critics who said his actions were wrong and what he should have done was obvious, Immelt told his successor, “Every job looks easy when you’re not the one doing it.

throughout my life, using skills or talents or a person’s raw physical power to help them rise to the top of their society came and went. In the beginning, it was the strength in their arms to swing their swords. Then the tongue to sway large groups to accomplish something together. It became those who developed the sciences, and then—to a degree—it was those again who had physical prowess and could run or shoot a ball into a hoop. Yet, it was those who produced the food, built the homes, protected society, or taught the children or young adults who often weren’t supported. They would do their jobs, punch their time cards, and do what needed to get done to keep society going. My suggestion is to consider all work—if done well—equal. Government needs to be in place, but we’ll require some form of service as your debt to society. Perhaps you are a musician but can test into working with an R&D lab in the future. Can that be your service?” “That,” Bethany Anne replied, “could be a nightmare. Just think about the ongoing effort for some of Jean Dukes’ stuff. There’s no way we could place a person into a project for two weeks and then they leave.” Michael tapped a finger on the table. “I understand. However, let me give you a quote from a worker to Jack Welch.” “Who?” Peter interrupted. Stephen answered, “Jack Welch. He was the CEO of General Electric—GE—back on Earth in the twentieth century.” Michael continued, “He was talking to the assembly line workers at one of their businesses and one of the men spoke up, telling Welch that ‘for twenty-five years you paid for my hands when you could have had my brain as well for nothing.’” The table was quiet a moment, thinking about that. Peter was the first to break it. “Makes sense. We use that concept in the Guardians all the time. Everyone has a role to play, but if you have ideas you need to speak up.” “It would,” Addix added, “allow those interacting to bring new ways of thinking to perhaps old and worn-out strategies.” “What about those who truly hated the notion?” Stephen asked. “I can think of a few.” “I’m tempted to say ‘fuck ‘em.’” Bethany Anne snorted. “However, I know people, and they might fuck up the works. What about a ten-percent charge of their annual wealth if they wish to forego service?” “Two weeks,” Michael interjected, “is at best four percent of their time.” “Right,” Bethany Anne agreed, “so I’d suggest they do the two weeks. But if they want to they can lose ten percent of their annual wealth—which is not their annual income, because that shit can be hidden.” The Admiral asked, “So a billionaire who technically made nothing during the year would owe a hundred million to get out of two weeks’ service?” “Right,” Bethany Anne agreed. “And someone with fifty thousand owes five thousand.” “Where does the money go?” Peter asked. Admiral Thomas grinned. “I suggest the military.” “Education?” Peter asked. “It’s just a suggestion, because that is what we are talking about.” Stephen scratched his chin. “I can imagine large corporations putting income packages together for their upper-level executives to pay for this.” “I suggest,” Bethany Anne added, “putting the names of those who opt out on a public list so everyone knows who isn’t working.” “What about sickness, or a family illness they need to deal with?” Stephen countered. “With Pod-docs we shouldn’t have that issue, but there would have to be some sort of schedule. Further, we will always have public projects. There are always roads to be built, gardens to be tended, or military

Under Welch, GE was changing rapidly. He famously gave a speech in his first year as CEO titled "Growing Fast in a Slow-Growth Economy." With the power of the GE brand providing credibility to his strategy, the new CEO oversaw almost one thousand acquisitions, or about four deals a month over his two decades, with a value topping $130 billion. p17

Jack Welch, former CEO of GE, spent an hour a day in what he called “looking out the window time.

The original idea, favored by Jack Welch, former CEO of GE, was that every company should aim for a certain level of turnover, whatever the consequences. The system was rife with perverse incentives. Peers who sabotaged others’ work could save their own jobs; managers might hire less-capable people on their teams to keep from having to fire existing employees whom they favored. Despite the system’s drawbacks, Welch’s influence was so far-reaching that stack ranking was adopted at many of today’s tech giants, where it wreaked havoc on morale and productivity for decades. Eventually, its negative effects became well known enough to make the practice a liability at companies chasing workers whose specialized talents made them scarce, such as engineers. In the mid-2010s, companies including Google, Microsoft, and Amazon abandoned it.

Nonetheless, the pattern seemed to repeat itself endlessly. A GE executive was named CEO of another company. News of the appointment would send the stock of that company soaring. The men were lavished with riches when they took their new jobs, signing multimillion-dollar contracts that ensured them a gilded retirement, no matter how well they performed. A period of downsizing usually ensued, and profits often ticked up for a few quarters, or even a few years. But inevitably, Welchism exacted its price. There was little focus on long-term strategy, and a slavish devotion to meeting quarterly results. “They wouldn’t know strategy if it hit them in the head,” said Roger Martin, the former Rotman School dean. “All they know how to do is take what they’ve got and refine it, make it operationally more effective.

What I found most interesting about Session C was the unique window it provided the CEO into the business. It was "boundaryless" before the word came into favor as a GE company value. It was functionally agnostic and part of a more extensive system managed by the top executive with ties to the board of directors, corporate and operating executives, and various management levels. No one could claim outright ownership for it, but everyone was intimately involved.

The Country Ambassador versus the Country Manager Some companies experiment with an interesting profile: a country chairperson who is a weak overlay over the business and largely plays an ambassadorial role. However, statesmanship and ambassadors are best left to the realm of diplomacy. These roles are a legacy of an era that no longer exists. GE tried the model over the past decade with limited success and finally abandoned it. A ceremonial role, with no accountability for the business and the responsibility only for engaging government, industry associations, and other CEOs, is usually not effective. Everyone—employees, customers, business partners, government officials—will quickly see this role for what it is and dismiss the person as lightweight. This does disservice to the incumbent and the role. The ambassadorial country manager who smells opportunity, but is powerless to act, can become intensely frustrated. Increasingly, the connections among strategy and execution, business, reputation, and regulation are tightening, so an artificial separation of these functions is suboptimal. Bringing accountability for these together in a single leader is vital for growing competent and well-rounded business leaders, who are capable of even being the CEO someday. If the business does require wise counsel, access, and influence and a senior public face, a strong advisory board headed by an iconic leader who serves as a nonexecutive chairperson may be a more prudent approach. We followed this model at Microsoft India with considerable success; the approach is gaining popularity at companies like Coca-Cola, Schneider Electric, and JCB.

Jack Welch, former CEO of GE. Welch says, “When the rate of change outside the company is greater than the rate of change inside, the end is near.