Book Extract

Master of constant change

Change yourself and change your organisation—constantly. These are the twin challenges of our corporate times. Executives must change themselves. They must develop new skills to make themselves more employable and to keep up with the heady pace of development.

Corporations must also change. The static organisation is on its way to the corporate graveyard.

Jack Welch has proved himself a master of both personal and corporate change. Welch never sits still and created an organisation that does likewise.

“Mr Welch can spend a day visiting a factory, jump on a plane, catch a few hours sleep, and start all over again; in between, he might stop in Sun Alley, Idaho, and as he puts it, ‘ski like crazy’ for five days,” noted an article in The Wall Street Journal.

Leaders are energetic. They have to be. Margaret Thatcher slept four hours a night and rose to pore over yet more government papers. IBM’s Lou Gerstner is renowned for his energy (and sleep) levels. Top executives travel constantly and yet still emerge from the arrivals lounge looking fresh, armed with a report they have just written somewhere over the ocean. David Campbell of the Center for Creative Leadership finds over and over that effective leaders and high energy go hand in hand on his leadership inventory.

Maximising energy

Energy is a prerequisite for the top job. The mistake is to think that Welch’s secret is quantity rather than quality. Maximising energy is much more than running fast or working harder. Anyone can work 16 hours a day. The world is full of hard working executives who have mortgaged their future health and family life against their current working day. But, how you spend your time, how you enthuse others is more important.

Quality is vital; quantity is no longer a competitive advantage. In fact, executives who pin their faith simply on working harder are taking a route to burnout and disenchantment.

The truth is that maximising effectiveness is more important than maximising working hours. Research by Phil Hodgson of Ashridge Management College estimated that conventional managers probably operate to just 40 percent of their true ability. They spend 10 percent of their time being really effective by doing what is important and 30 percent of their time gaining credibility in order to be really effective for that other 10 percent. The rest of the time they spend doing things that are not important, or don’t produce the outcome they want. Do the important things more often and more intensively and you will be working smart.

Working smart, Jack Welch style, has a number of features: Everyday is different. Everyday is a challenge. “Who runs out of ideas?” asks Welch. “If you never had another idea, you might as well quit your job. Every day we wake up, there’s another basket of opportunities. When you are $70 billion company, you are doing so many things wrong that the amount available for improvement is literally infinite.

Our improvements are getting greater with time, not diminishing.” Such relentless positivism insists that things can be sorted out, improved, solved. And it works.

Peel away the layers. Reverse engineer. Leaders have to dig deep, and deeper and deeper still.

They must peel away the layers. Executives must look for problems to solve. And then there is another problem, and another. Welch is an engineer by training and the urge to ask questions and figure out what is really happening has never left him.

They are not angelic figures who regard financial rewards as unimportant. They expect to be well rewarded, but look beyond the narrow motivation of money alone.

Get a life. “I spend enough hours to get the job done,” Welch once said. He is not one of those macho execs who constantly refers to working 23 hours a day and sleeping for five nanoseconds. (Of course, the fact that he does not say it repeatedly does not mean that he doesn’t work long hours. It’s just not a big deal).

Jack Welch, strange as it may seem, had a life outside GE. It was a fairly ordinary life. For such a powerful and wealthy man it was a very quiet life. Living opposite a golf club ensured that the first tee was never far away. He didn’t fill his few spare hours with non-executive directorships or other peripheral stuff. He enjoyed getting his handicap down and recharging. Smart.

Learn and change

Not only did Jack Welch work smart: he developed smart. His career has missed out the stagnancy of middle age. He has kept on learning, adding to his formidable battery of skills. He has changed and then changed some more. In doing so he has defied a commonplace pattern.

Look at how our careers develop. In the first place, we watch the corporate video or attend an induction programme to know the basics of what is expected of us: the corporate values and behaviour. Then, we go up through the first level of performance and are taught the essential things to survive and prosper in that business—perhaps it is selling, perhaps it is computing, perhaps it is accounting. Whatever it is we are given the basic rules. Master marketing and you will progress. Good financiers get to the top here.

Then, if we are very good, we move into a second layer where we can start to adapt some of the things we have been taught to local circumstances. But, it we come up against something we really don’t know, our best way of dealing with it is to go and ask someone who does know to help us enhance our knowledge.

During this process, the developing executive is highly conscious of his or her vulnerability. As we have seen, learning involves taking a risk and taking risks makes us vulnerable. People are afraid to make themselves more vulnerable, to expose themselves to potential loss of face, loss of opportunity or simply loss.

As a result, the executives develop what has been accurately labeled as a myth of mastery. By steering clear of trouble spots, situations that make them vulnerable, executives begin to believe that they are invincible. In their own minds that are, in Tom Wolfe’s phrase, “Masters of the Universe.”

In turn, this provides a formula for executive progression. The people who reach the top are high performers who don’t make mistakes. They get it right, but sacrifice things to get it right. They are often better at a particular skill than the people who work for them. They are perfectionists with high IQs who don’t tolerate dips in performance. They are also superstitious—believing that if they do what they have always done, things will come right.

As an adjunct to the myth of mastery, executives are often promoted because they are good technically, not because they are good with people.

Excerpt from ‘Business the Jack Welch Way’ by Stuart Crainer. Published by Wiley India