Straight From the Gut
First of all, I love reading Jack Welch books. As most of you know, he is the former Chairman and CEO of General Electric, and is considered the CEO's CEO. I have followed him myself for many years, and have learned a great deal. Here are some quotes that I highlighted while reading his book, Straight From the Gut, several years ago:
1. It’s really the we that counts
2. You looked a lot better when you were just being yourself.
3. I never stopped seeing my roots even as my eyes opened to see a world I never new existed.
4. 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.
5. Basic management beliefs – competing hard to win, facing reality, motivating people by alternately hugging and kicking them, setting stretch goals, and relentlessly following up on people to make sure things get done
6. There are no shortcuts, don’t kid yourself.
7. Confidence – it’s what I’ve looked for and tried to build in every executive who has ever worked for me. Confidence gives you courage and extends your reach. It lets you take greater risks and achieve far more than you ever thought possible. Building self-confidence in others is a huge part of leadership. It comes from providing opportunities and challenges for people to do things they never imagined they could do – rewarding them after each success in every way possible.
8. There are rarely black and white answers. More often than not, business is smell, feel, touch, as much as or more than numbers. If we wait for the perfect answer, the world will pass us by.
9. In just one year, GE’s bureaucracy would nearly drive me out of the company.
What I was trying to do was “get out of the pile.” I wanted to provide not only the answer, but an unexpected fresh perspective.
10. Differentiation is all about being extreme, rewarding the best and weeding out the ineffective. Rigorous differentiation delivers real stars, and stars build great businesses.
11. The relative contributions of those players are easy to measure – they jump out at you – yet they are still part of a team.
12 . Everybody has to feel they have a stake in the game. But that doesn’t mean everyone on the team has to be treated the same way.
13. When people make mistakes, the last thing they need is discipline. It’s time for encouragement and confidence building. The job at this point is to restore self-confidence.
14. I think “piling on” when someone is down is one of the worst things any one of us can do.
Piling on during a week moment can force people into a vortex. You see this when leaders lose their confidence, begin to panic, and spiral downward into a hole of self-doubt.
15. Arrogant people who refuse to learn from their mistakes have to go.
16. Global intellect, tapping every great mind in the world no matter where it was located.
17. The best way to support dreams and stretch is to set apart small ideas with big potential, then give people positive role models and the resources to turn small projects in to big business.
18. I loved “constructive conflict” and thought open and honest debates about business issues brought out the best decisions.
19. firing people – If I learned anything about making it easier, it’s seeing to it that no one should ever be surprised when they are asked to leave. By the time I met with managers I was about to replace, I would have had at least two or three conversations to express my disappointment and to give them the chance to turn things around. I would follow up every business review with a handwritten note. I’ve seen many people go on to better and happier lives after leaving jobs that just weren’t working. All of us have a responsibility to try to make that happen.
20. We’d spend hours in a room, peeling back the onion until all the issues were exposed.
21. I realized how much my success would depend on the people I hired. I understood the importance of getting the right people.
22. In the early days, I fell in love with great resume’s filled with degrees in different disciplines. They could be bright and intellectually curious, but they often turned out to be unfocused dabblers, unwilling to commit, lacking intensity and passion for any one thing. In the hands of the inexperienced, resumes are dangerous weapons.
23. I learned that I was really looking for people who were filled with passion and a desire to get things done. A resume didn’t tell me much about that inner hunger. I had to “feel” it.
24. I could no longer have fingertip control of all the details. That made my obsession about people even more intense.
25. No one was used to the intense discussions about the strengths and weaknesses of every individual on their team.
26. Once again I saw the benefits of acting like a small company. Giving the project visibility, putting great people on it, and giving them plenty of money continues to be the best formula for success.
27. Many of these kind performance appraisals would come back to haunt me in the early 1980’s when we had to downsize the company. The “false kindness” only misled people and made their layoff an even greater shock than it would have been.
28. I learned the importance of people, supporting the best and removing the weakest.
29. There is probably nothing worse in business than to work for a boss who doesn’t want you to win. This can happen anywhere, at any level, and probably occurs more often than we think.
30. Downsizing’s are awful, as hardworking people get hammered by competitive change. In difficult businesses these changes never end. Unfortunately, it’s never over.
31. I’d gather them in a room – several layers worth of management – and grill them about the ins and outs of their business. “lets pretend we’re in high school – take me through the basics”
32. After the review, we’d take everyone out to get a better feel for them in a social atmosphere. In general, most didn’t look any better after hours than they did during the day.
33. I felt it was a good bet to put people in stretch jobs early in their careers. Far more often than not, they brought a lot more excitement and passion to the job and achieved greater personal growth for themselves.
34. Some employees proudly described the company as a “supertanker” – strong and steady in the water. I respect that but wanted the company to be more like a speedboat, fast and agile, able to turn on a dime.
35. I wanted GE to run more like the plastics business I came from – a company filled with self-confident entregpreneurs who would face reality every day. Every milestone could trigger a celebration that would make a business fun.
36. The good businesses had to be sorted out from the bad ones. I wanted GE to stay in businesses that were either No. 1 or No.2 in their markets. We had to act faster and get the damn bureaucracy out of the way.
37. All my career, I never wanted to see a planning book before the person presented it. To me, the value of these sessions wasn’t in the books. It was in the heads and hearts of the people who were coming into Fairfield. I wanted to drill down, to get beyond the binders and into the thinking that went into them. I needed to see the business leaders body language and the passion they poured into their arguments.
38. I wanted to break the cycle of these dog and pony shows. Hierarchy’s role to passively “review and approve” had to go.
39. Created a collegial group at the top called the Corporate Executive Council – or CEC.
Organizational layers were another residue of size. I used the analogy of putting on too many sweaters. Sweaters are like layers. They are insulators. When you go outside and you wear four sweaters, it’s difficult to know how cold it is.
40. Another effective analogy was comparing an organization to a house. Floors represent layers and the walls functional barriers. To get the best out of an organization, these floors and walls must be blown away, creating an open space where ideas flow freely, independent of rank or function. The impact of these layers was seen most easily in the capital appropriations request process. In some cases, 16 other people had already signed it, and my signature was the one required. What value was I adding? Eliminated the above process – each business leader has the same delegation of authority that the board gave me.
51. At the beginning of every year, the business made the case for the capital it needed. They own it and decide how far to delegate the spending authority. The people closest to the work know the work best. They become more accountable. They take their recommendations more seriously if they know a bunch of signatures aren’t piled on top of them.
52. Power represented much of what had to change, not the technology and products, but the attitudes. Too many managers considered their positions as reqwards for service to the company, a career capstone rather than a fresh opportunity. There was an attitude that customers were “fortunate” to place orders for their wonderful machines. The long-cycle nature of the business, with product life cycles and order backlogs measured in years, only compounded the lack of pace, excitement, and energy.
53. I probably didn’t understand many businesses – but I had the benefit of a pair of fresh eyes. I hadn’t invested my life in this business. I loved their passion, even though I felt it was misdirected.
54. Toward the end of our meeting, they resorted in frustration to one of the favorite “when all else fails” arguments heard in the business. “if we take the orders out of the plan, you’ll kill morale and you’ll never be able to mobilize the business when the orders come back.” That wasn’t the first time or the last time I heard desperate business teams use the argument. That reasoning falls into the same category as the other plea I often heard during tough times: “You’ve cut all the fat out. Now you’re into bone and you’ll ruin the business if we cut more.” Both arguments don’t make it. They’re both weak. Management always has a tendency to take the smallest bit of the cost apple. Inevitably, managers have to keep going back, again and again, to cut more as markets deteriorate. All this does is create more uncertainty for employees. I’ve never seen a business ruined because it reduced its costs too much, too fast. When good times come again, I’ve always seen business teams mobilize quickly and take advantage of the situation.
55. The opportunity to make heroes out of people who were not obvious Welch disciples was a breakthrough. It sent a clear message: You didn’t have to fit a certain stereo type to be successful in the new GE. You could be a hero no matter what ou looked like or how you acted.
56. All you had to do was face reality and perform.
57. I found it hard to get people to see a situation for what it is and not for what it was, or what they hoped it would be.
58. In a business plan, there’s little percentage in betting on hope. Self-delusion can grip an entire organization and lead the people in it to ridiculous conclusions. Whether it was appliances in the late 1970’s, nuclear in the 80s, or dot.coms at the turn of the century, getting people to face reality was the first step toward an eventual solution.
59. I told success stories for different divisions over and over again and every meeting for 20 years to get ideas transferred across the company.
1. It’s really the we that counts
2. You looked a lot better when you were just being yourself.
3. I never stopped seeing my roots even as my eyes opened to see a world I never new existed.
4. 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.
5. Basic management beliefs – competing hard to win, facing reality, motivating people by alternately hugging and kicking them, setting stretch goals, and relentlessly following up on people to make sure things get done
6. There are no shortcuts, don’t kid yourself.
7. Confidence – it’s what I’ve looked for and tried to build in every executive who has ever worked for me. Confidence gives you courage and extends your reach. It lets you take greater risks and achieve far more than you ever thought possible. Building self-confidence in others is a huge part of leadership. It comes from providing opportunities and challenges for people to do things they never imagined they could do – rewarding them after each success in every way possible.
8. There are rarely black and white answers. More often than not, business is smell, feel, touch, as much as or more than numbers. If we wait for the perfect answer, the world will pass us by.
9. In just one year, GE’s bureaucracy would nearly drive me out of the company.
What I was trying to do was “get out of the pile.” I wanted to provide not only the answer, but an unexpected fresh perspective.
10. Differentiation is all about being extreme, rewarding the best and weeding out the ineffective. Rigorous differentiation delivers real stars, and stars build great businesses.
11. The relative contributions of those players are easy to measure – they jump out at you – yet they are still part of a team.
12 . Everybody has to feel they have a stake in the game. But that doesn’t mean everyone on the team has to be treated the same way.
13. When people make mistakes, the last thing they need is discipline. It’s time for encouragement and confidence building. The job at this point is to restore self-confidence.
14. I think “piling on” when someone is down is one of the worst things any one of us can do.
Piling on during a week moment can force people into a vortex. You see this when leaders lose their confidence, begin to panic, and spiral downward into a hole of self-doubt.
15. Arrogant people who refuse to learn from their mistakes have to go.
16. Global intellect, tapping every great mind in the world no matter where it was located.
17. The best way to support dreams and stretch is to set apart small ideas with big potential, then give people positive role models and the resources to turn small projects in to big business.
18. I loved “constructive conflict” and thought open and honest debates about business issues brought out the best decisions.
19. firing people – If I learned anything about making it easier, it’s seeing to it that no one should ever be surprised when they are asked to leave. By the time I met with managers I was about to replace, I would have had at least two or three conversations to express my disappointment and to give them the chance to turn things around. I would follow up every business review with a handwritten note. I’ve seen many people go on to better and happier lives after leaving jobs that just weren’t working. All of us have a responsibility to try to make that happen.
20. We’d spend hours in a room, peeling back the onion until all the issues were exposed.
21. I realized how much my success would depend on the people I hired. I understood the importance of getting the right people.
22. In the early days, I fell in love with great resume’s filled with degrees in different disciplines. They could be bright and intellectually curious, but they often turned out to be unfocused dabblers, unwilling to commit, lacking intensity and passion for any one thing. In the hands of the inexperienced, resumes are dangerous weapons.
23. I learned that I was really looking for people who were filled with passion and a desire to get things done. A resume didn’t tell me much about that inner hunger. I had to “feel” it.
24. I could no longer have fingertip control of all the details. That made my obsession about people even more intense.
25. No one was used to the intense discussions about the strengths and weaknesses of every individual on their team.
26. Once again I saw the benefits of acting like a small company. Giving the project visibility, putting great people on it, and giving them plenty of money continues to be the best formula for success.
27. Many of these kind performance appraisals would come back to haunt me in the early 1980’s when we had to downsize the company. The “false kindness” only misled people and made their layoff an even greater shock than it would have been.
28. I learned the importance of people, supporting the best and removing the weakest.
29. There is probably nothing worse in business than to work for a boss who doesn’t want you to win. This can happen anywhere, at any level, and probably occurs more often than we think.
30. Downsizing’s are awful, as hardworking people get hammered by competitive change. In difficult businesses these changes never end. Unfortunately, it’s never over.
31. I’d gather them in a room – several layers worth of management – and grill them about the ins and outs of their business. “lets pretend we’re in high school – take me through the basics”
32. After the review, we’d take everyone out to get a better feel for them in a social atmosphere. In general, most didn’t look any better after hours than they did during the day.
33. I felt it was a good bet to put people in stretch jobs early in their careers. Far more often than not, they brought a lot more excitement and passion to the job and achieved greater personal growth for themselves.
34. Some employees proudly described the company as a “supertanker” – strong and steady in the water. I respect that but wanted the company to be more like a speedboat, fast and agile, able to turn on a dime.
35. I wanted GE to run more like the plastics business I came from – a company filled with self-confident entregpreneurs who would face reality every day. Every milestone could trigger a celebration that would make a business fun.
36. The good businesses had to be sorted out from the bad ones. I wanted GE to stay in businesses that were either No. 1 or No.2 in their markets. We had to act faster and get the damn bureaucracy out of the way.
37. All my career, I never wanted to see a planning book before the person presented it. To me, the value of these sessions wasn’t in the books. It was in the heads and hearts of the people who were coming into Fairfield. I wanted to drill down, to get beyond the binders and into the thinking that went into them. I needed to see the business leaders body language and the passion they poured into their arguments.
38. I wanted to break the cycle of these dog and pony shows. Hierarchy’s role to passively “review and approve” had to go.
39. Created a collegial group at the top called the Corporate Executive Council – or CEC.
Organizational layers were another residue of size. I used the analogy of putting on too many sweaters. Sweaters are like layers. They are insulators. When you go outside and you wear four sweaters, it’s difficult to know how cold it is.
40. Another effective analogy was comparing an organization to a house. Floors represent layers and the walls functional barriers. To get the best out of an organization, these floors and walls must be blown away, creating an open space where ideas flow freely, independent of rank or function. The impact of these layers was seen most easily in the capital appropriations request process. In some cases, 16 other people had already signed it, and my signature was the one required. What value was I adding? Eliminated the above process – each business leader has the same delegation of authority that the board gave me.
51. At the beginning of every year, the business made the case for the capital it needed. They own it and decide how far to delegate the spending authority. The people closest to the work know the work best. They become more accountable. They take their recommendations more seriously if they know a bunch of signatures aren’t piled on top of them.
52. Power represented much of what had to change, not the technology and products, but the attitudes. Too many managers considered their positions as reqwards for service to the company, a career capstone rather than a fresh opportunity. There was an attitude that customers were “fortunate” to place orders for their wonderful machines. The long-cycle nature of the business, with product life cycles and order backlogs measured in years, only compounded the lack of pace, excitement, and energy.
53. I probably didn’t understand many businesses – but I had the benefit of a pair of fresh eyes. I hadn’t invested my life in this business. I loved their passion, even though I felt it was misdirected.
54. Toward the end of our meeting, they resorted in frustration to one of the favorite “when all else fails” arguments heard in the business. “if we take the orders out of the plan, you’ll kill morale and you’ll never be able to mobilize the business when the orders come back.” That wasn’t the first time or the last time I heard desperate business teams use the argument. That reasoning falls into the same category as the other plea I often heard during tough times: “You’ve cut all the fat out. Now you’re into bone and you’ll ruin the business if we cut more.” Both arguments don’t make it. They’re both weak. Management always has a tendency to take the smallest bit of the cost apple. Inevitably, managers have to keep going back, again and again, to cut more as markets deteriorate. All this does is create more uncertainty for employees. I’ve never seen a business ruined because it reduced its costs too much, too fast. When good times come again, I’ve always seen business teams mobilize quickly and take advantage of the situation.
55. The opportunity to make heroes out of people who were not obvious Welch disciples was a breakthrough. It sent a clear message: You didn’t have to fit a certain stereo type to be successful in the new GE. You could be a hero no matter what ou looked like or how you acted.
56. All you had to do was face reality and perform.
57. I found it hard to get people to see a situation for what it is and not for what it was, or what they hoped it would be.
58. In a business plan, there’s little percentage in betting on hope. Self-delusion can grip an entire organization and lead the people in it to ridiculous conclusions. Whether it was appliances in the late 1970’s, nuclear in the 80s, or dot.coms at the turn of the century, getting people to face reality was the first step toward an eventual solution.
59. I told success stories for different divisions over and over again and every meeting for 20 years to get ideas transferred across the company.
posted by Lance Reid at 2:41 PM
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