The recently completed split of GE into three independent public companies marks the end of a 100-plus-year era that saw GE become a global “everything company” under the leadership of business icon Jack Welch. Protiviti’s Jim DeLoach explores the rise and fall of GE and what lessons GE’s story holds for the leaders of today and tomorrow.
Jack Welch was regarded as one of the most accomplished CEOs of the 20th century in terms of creating shareholder value. During his 20 years as CEO of General Electric, he grew GE’s market capitalization over 30 times. Given his undisputed success in making GE the most valuable company on the planet, people listened whenever he spoke. They wanted to know his “secret sauce.”
But a series of 21st century disruptions, including those both corporate and cultural, led to the eventual breakup of the American mega-conglomerate.
The Welch management philosophy
When Welch became GE’s chairman and CEO in 1981, he inherited a lumbering industrial conglomerate beset with a bureaucratic corporate structure, a cumbersome strategic planning process, a limited strategic focus and a perception that the company was slow to adapt to the market. At that time, GE also faced the challenge of translating financial results into attractive stock performance.
To address…
