Warren Buffett says of this book: “No other management book will ever be needed.”
Jack Welch, one of America’s most legendary CEOs of all time, increased General Electric (GE)’s value by over 40-fold during his 20-year tenure as the chief. From a chemical engineer in GE’s plastics division, to the company’s youngest VP and eventually the Chairman and CEO, his professional journey is the embodiment of growth. Some people love him with passion, some despise his views on many things, but I do believe we all can learn something immensely valuable from his professional success. As I’m reading this book, I constantly reflect on myself, and discovered so many pearls of wisdom. The following are my top takeaways from each of the four sections in his bestseller, Winning:
I. Underneath It All
1. Mission and Values:
The mission tells your organization where it’s going (thus answering one question: how do you intend to win in this business), and values describe the behaviors that will get you there. “Effective mission statements balance the possible and the impossible. They give people a clear sense of the direction to profitability and the inspiration to feel they are part of something big and important.” To Jack, values = behaviors. “People must be able to use them [values/behaviors] as marching orders because they are the how of the mission, the means to the end—winning.”
Jack calls the lack of candor “the biggest dirty little secret in business.” “Lack of candor blocks smart ideas, fast action, and good people contributing all the stuff they’ve got. It’s a killer.”
Jack strongly believes a company should greatly differentiate its software and hardware.
- Software: the people. “20-70-10” a very controversial part of Jack’s leadership. He separate his employees into three categories according to performance: (1) Top 20% should be “showered with bonuses, stock options, praise, love, training, and a variety of rewards to their pocketbooks and souls.” (2) Keep the middle 70% engaged and motivated. “…much of managing the middle 70 is about training, positive feedback, and thoughtful goal setting. If individuals in this group have particular promise, they should be moved around among businesses and functions to increase their experience and knowledge and to test their leadership skills.” (3) bottom 10% have to go. Jack believes that giving under-performers candid and timely feedback and letting them go actually helps them to find work that they can actually strive.
- Hardware: businesses in your portfolio and product lines. This was how Jack lived out his philosophy: “From 1981 through 1995, we said we were going to be “the most competitive enterprise in the world” by being No. 1 or No. 2 in every market— fixing, selling, or closing every underperforming business that couldn’t get there.”
II. Your Company
What Leaders Do
1. Leaders relentlessly upgrade their team, using every encounter as an opportunity to evaluate, coach, and build self-confidence.
2. Leaders make sure people not only see the vision, they live and breathe it.
3. Leaders get into everyone’s skin, exuding positive energy and optimism.
4. Leaders establish trust with candor, transparency, and credit.
5. Leaders have the courage to make unpopular decisions and gut calls.
6. Leaders probe and push with a curiosity that borders on skepticism, making sure their questions are answered with action.
7. Leaders inspire risk taking and learning by setting the example.
8. Leaders celebrate.
Jack believes that “the head of HR should be the second most important person in any organization… nothing matters more in winning than getting the right people on the field.” Here is his hiring matrix:
- 3 acid tests: integrity, intelligence, maturity (“certain traits that seem to indicate a person has grown up: the individual can withstand the heat, handle stress and setbacks, and, alternatively, when those wonderful moments arise, enjoy success with equal parts of joy and humility. Mature people respect the emotions of others. They feel confident but are not arrogant.”)
- 4-E (and 1-P) framework:
- Energy: “People with positive energy just love life.”
- the ability to Energize others
- Edge, the courage to make tough yes/no decisions: “Effective people know when to stop assessing and make a tough call, even without total information. Little is worse than a manager who can’t cut bait.”
- Execute: “knows how to put decisions into action and push them forward to completion, through resistance, chaos, or unexpected obstacles. People who can execute know that winning is about results.”
- Passion: “People with passion care— really care in their bones—about colleagues, employees, and friends winning. They love to learn and grow, and they get a huge kick when the people around them do the same” [What this site, WeZBest.com, is all about: Learn & Grow (which will lead to winning in life & work), and personally I do get a huge kick when my friends & like-minded people do same, haha!]
III. Your Competition
Jack has a very straightforward view of strategy. What he said in this book clearly reminded me of what Cigna’s CEO told me and my fellow actuaries about strategy – something should be fit on a piece of paper. Organizational strategy excites me; ever since I started to run student organizations as a sophomore in college, I’ve been constantly thinking how I can help my organization to win in the local community? To Jack Welch, strategy is also something exciting, it’s “a living, breathing, totally dynamic game.”
- “…what is strategy but resource allocation? When you strip away all the noise, that’s what it comes down to. Strategy means making clear-cut choices about how to compete. You cannot be everything to everybody, no matter what the size of your business or how deep its pockets.”
- Jeck Welch has three steps to do strategy:
First, come up with a big aha for your business—a smart, realistic, relatively fast way to gain sustainable competitive advantage.
Second, put the right people in the right jobs to drive the big aha forward.
Third, relentlessly seek out the best practices to achieve your big aha, whether inside or out, adapt them, and continually improve them.
- To find out what the big aha is and to test your strategy, Jack has something called Five Slides (Jack is definitely a master at coming up with management methodology; I wonder do all great CEOs good at coming up with McKinsey-style frameworks? Haha!)
SLIDE ONE: What the Playing Field Looks Like Now
SLIDE TWO: What the Competition Has Been Up To
SLIDE THREE: What You’ve Been Up To
SLIDE FOUR: What’s Around the Corner?
SLIDE FIVE: What’s Your Winning Move?
To learn more about these Five Slides, check out a great article by Jack Welch: Five Questions That Make Strategy Real
IV. Your Career
1. Finding the right job:
Jack believes finding the right job involves iterations: get a job and learn something about yourself: what you do like/dislike, and what are you good/bad at? Look out for signals for good fit:
2. Get promoted:
Basically, getting promoted takes one do and one don’t.
– Do deliver sensational performance, far beyond expectations, and at every opportunity expand your job beyond its official boundaries.
– Don’t make your boss use political capital in order to champion you.
- He then added a few other dos and don’t:
- Manage down: “Manage your relationships with your subordinates with the same carefulness that you manage the one with your boss.”
- Get on the radar screen: by stellar results and by “being an early champion of your company’s major projects or initiatives.”
- Amassing mentors: “Search out and relish the input of lots of mentors, realizing that mentors don’t always look like mentors.” This reminds me of an article I wrote and publish on CoachingActuaries blog, Let Others Be Your Teachers.
- Be the sunshine in the office: “Have a positive attitude and spread it around.”
- “Don’t let setbacks break your stride.”
- He then added a few other dos and don’t:
2. Work-life Balance:
I’m not sure if a legendary CEO as hardworking as Jack Welch would be a great source for work-life balance advice, but here summarizes his take on this topic:
Best practice 1: Keep your head in whatever game you’re at. We’ve already established that work wants 150 percent of you, and so does home. To alleviate angst and distraction, and to enhance your performance no matter what you are doing, be focused on where you are and whom you are with. In other words, compartmentalize.
Best practice 2: Have the mettle to say no to requests and demands outside your chosen work-life balance plan. Eventually, most people come up with a work-life balance arrangement that works for them. The trick is sticking to it. That takes discipline. Saying no is hard, especially for businesspeople who have gotten ahead precisely because they have said yes so often.
Best practice 3: Make sure your work-life balance plan doesn’t leave you out. … You have to make sure your work-life balance plan fulfills your dreams and passions. If that means working a lot, do it. If that means being home every night, let that happen too.
- Btw, Jack admitted at the beginning of this chapter: “No one—myself included—would ever call me an authority on work-life balance…. from my earliest days in Plastics, I used to show up at the office Saturday mornings. Not coincidentally, my direct reports showed up too. Personally, I thought these weekend hours were a blast… I never once asked anyone, “Is there someplace you would rather be—or need to be—for your family or favorite hobby or whatever?” The idea just didn’t dawn on me that anyone would want to be anywhere but at work.”
Time to act – how this book can help you grow!
After using Jack Welch’s advice listed here as a checklist to self-reflect and level up your game in the journey of winning, ask yourself: am I intentional in whatever I do? Notice Jack is a master in coming up with systems/frameworks that summarize how he wins. I hypothesize that his science/engineering background might have helped him to develop such an systematic way of thinking and approaching problems. Being able to self-reflect and know what work and what don’t is very important in our growth journey.