History of• Established in 1879 by Thomas Alva Edison, backing of banker J.P.Morgan as Electric Light Company.• Started manufacturing light bulbs & ele. equipment.• Edison was great inventor but not far-sighted manager.• Later Morgan took over charge and named it as General Electric Co.
Life cycle of Jack Welch• Born - 19th November 1935 at Massachusetts• Father was of passive conductor in train• Mother was dominating women and a housewife• He was a brilliant student at the University of Massachusetts• He did doctorate in Chemical Engineering from University of Illinois• He joined GE plastic factory in 1960• In 1981 he became CEO of GE• He retired from GE in September 2001• Became national hero
Traits of Jack Welch• Blunt – Speaks their own mind• Self motivated• Impatient with subordinates• Emotionally volatile – Unpredictable behavior• Fiery tempered• Neutron Jack• Charismatic leader• Not meliable
Traits of Welch• Vision: Ability to see around corners, probe consensus thinking and swiftly make a change when the market demands it.• Leadership: Track-record with people: How one supports and guides people who are working with him.• Crisis-management ability: Experience and courage to overcome a crisis.
Achievements of• Rapid growth • If Invested $100 in 1981 value becomes $6749 in 2001 (664% )• Monopoly in bulb market• Acquisition of RCA• New technology• Boundary-less organization• Expansion in new areas• Improved productivity in locomotives
Malpractices of• High employee turnover • As, Bs & Cs • 1 of every 4 employees was gone• Not fulfilling corporate social responsibility • Polluting Hudson river by releasing polychlorinated biphenyls• Pension fund• Criminal activities • Deceptive advertising of light bulbs & unfair debt collection • 39 law violation • Contracting fraud
Activities of Jack• Took company from $14 billion to $410 billion during his 20 years of journey in GE• Removal of bureaucracy• Adopted boundary less organization• Adopted Six sigma to eliminating defects• Selling of low profit companies• High rate profitability
Activities of Jack• Retrenchment of employees• Breaching of civil and criminal laws• Adoption of As, Bs, Cs session• Globalization• Purchasing of other units• Practice of work-out sessions• Enrichment of share holders
For society …• Paid taxes of $5.7 billion in 2000.• Managers became multimillionaire in GE stock.• Made $40 million in grants to colleges, universities, & non-profit group.• Community projects • Tutoring • Playground construction • Repairing school equipment & rec. machines for blind • Special Olympics
Other side of coin• Pressured cities, countries & states to lower taxes by threatening to move operation elsewhere.• This lowered budget for schools and infrastructure.• Manipulating laws which are in favor of company.