I’d like to review Jack Welch’s latest offering and NY Times Bestseller, Winning, written with his second wife, Suzy Welch, who I feel softened the old man up a little bit. His premise is simple, but right on: forget management theory, the only way to learn how to manage is to roll up your sleeves and do it. The medical profession has known this for years with their “see one, do one, teach one” training approach. Every medical student has learned this way in spite of what the books say. Unfortunately our management library is replete with “how to” books and esoteric theories that sound good but seldom are put in practice.

 

Make no mistake about it. Welch’s book is a “take no prisoners” approach on how to run a successful company which he did at GE for forty years. His philosophy is simple: you win or you lose. It reminds me of John Wayne as a platoon sergeant in Imo Jima, “See that hill men, let’s take it.” No namby-pamby. Welch ran GE the same way. Let’s look at his take on “Mission Statements.” This is clearly top management’s responsibility. Don’t delegate this to some Big Four management consulting company. If your leaders don’t have a vision for the company, then replace them. Effective mission statements should balance the possible and the impossible (Welch, p. 15). Values are the how of the mission and should be specific and change behavior. Welch uses Bank One’s values as an example of how to treat each other: 1) leaner is better; 2) eliminate bureaucracy; 3) cut waste relentlessly; 4) operations should be fast and simple; 5) value each other’s time; 6) invest in infrastructure; and 7) we should know our customers best. How often do we spend in endless, repetitive meetings that have nothing to do with the above values. Welch would say if you’ve got time to gab, then take a cab. Another paraphrase might be, if you can’t manage, then get the hell out of the way. Yes, he is coarse; yes, he is ego-driven; yes, he can be “in your face.” But one thing you can’t argue is GE’s numbers: until recently the most profitable company in the world and leader of jet engines (Exxon-Mobil has surpassed with the recent upsurge in oil and gas prices).

 

Another hallmark is Welch’s 20-70-10 rule. The top 20% are your “winners.” Pay them handsomely so they don’t leave. Pamper them if you have to; look at what George Steinbrenner’s done with the NY Yankees. Welch uses the baseball metaphor often in his book and considers the top performers your “star players.” The middle 70% are the backbone of the company and should not be ignored. Without middle management no one is left to do the hard work to design, build, and sell jet engines. The bottom 10% have been hitting below 200 for years and no longer need to take up space on the company’s bench; cut them; let them go; do them a favor (and yourself); adios. He devotes a full chapter in giving the bad news to under-performers, in his chapter: “Letting Go is Hard to Do.” First, no surprises, second, minimize humiliation. All good managers must do the dirty work of firing for non-performance. To ignore this is to ignore your responsibilities as a manager and you might be on the losing end at your next 360 evaluation.

 

I especially liked Welch’s chapter on “Strategy: It’s all in the sauce.” Forget the fancy templates and power points. Strategy means making clear-cut choices about how to compete.” (Welch, p.169). It’s the SWOT analysis redefined in one sentence. Short, sweet, and simple. That’s Jack Welch. In his chapter on “Getting Promoted: Sorry, No Shortcuts,” he talks about: treat your subordinates like you would your boss, champion the company’s major projects early on, search out and relish the input of mentors, and have a positive attitude and spread it around. There’s one no-no: don’t manage down. You’ve seen or worked for this person: s(he) is always telling you what the boss wants without buying into the mandate but only acting as the messenger. In other words, no backbone, no responsibility, no ownership, and no values, except “protect your own backside.” Welch puts these managers in the bottom 10% who are on their way out the door.

 

Whether you love or hate this guy, Winning is entertaining and written to incite and debate the merits of managing people to produce winners. After all, who wants to work for a losing company? Avis branded itself as being No. 2 but look what it did for Hertz.

 

This month’s recommendations:

 

 

1.     Pick out a “how to” book that follows your passion: gardening, managing, writing, painting, to see if the charisma of the author was a factor in your selecting this book.

2.     Look at how you respond to stress at work; ask your staff if they will share in a “no holds barred” encounter on whether you try to protect or infect staff with stress.

3.     Ask yourself this question: Why do I work? Write a least 500 words and review if you work for extrinsic or intrinsic reasons.