Change Leader Jack Welch Business Essay

1279 words (5 pages) Essay in Business

5/12/16 Business Reference this

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This paper will take a closer examination at how Jack Welch changed the General Electric Company using a transformational leader style. Welch’s strategic were to change the value system at General Electric. Moreover, Jack Welch is considered one of the greatest leaders in corporate business in the 21st century. What has made Welch so successful is his development of a modern model design for his company. Welch’s model has escalated the growth of General Electric profits billions dollars in a span of an about twenty years. There is no corporate leader to this date that has shaped the value of their company for shareholders much and as rapidly as Jack Welch has. He created a market that had share running high to make the company worth billion. Welch transformed General Electric, a key giant company during the industrial age in American into thriving company modern day company that is highly competitive globally. The key to all of Welch’s success is his ability to relate to people in an informal matter. He has protected communicating across the organization informally with his chain command and subordinates alike. Moreover, Welch’s charismatic leadership style and his aggressiveness when he attended meeting and events has given him the ability to communicated effectively with a very large number of employee across the entire organization.

Jack’s Welch’s Background

Jack Welch was born in 1935 in Salem Massachusetts (Abetti, 2006). Welch received his undergraduate, Master’s And Ph. D degrees all in the field of Chemical Engineering. Moreover, in 1960, Welch began his career with General Electric as a Chemical Engineer. According Abetti (2006) to the General Electric Company has been a part of history as far back as the development of new light technology starting with Thomas Edison becoming one of the largest organizations around the World over. However, as time went by General Electric begin to make their employees push in the development of product to in front of their competitive. One executive who had the leadership ability to do this was Jack Welch’s (Abetti, 2006). His leadership is considered true transformation leadership. He created a vision base on organization values. Welch efforts has help reform the structure of General Electrical management by cutting the middle management staff members.

Jack’s Welch’s Strategy

Jack Welch’s strategy was first getting his followers to see the big picture where General Electric was heading in the future. The whole time as CEO, he delivered his messages repeat to reinforce them. Them by handwritten directly to the employee this method has inspired many of the organization. Welch is known to spend most of his time in dealing with issues with employees. He personal knows over 1000 employee in the at all level in the company and this is by a first name bases (Amernic, Craig, & Tourish, 2007). Next, he created a completely new organization culture by restructuring the hierarchy of nine management levels in a simple structure that was more cost effective. Welch new that many of his senior leadership would question his policies. However, the key to his plan was to stick with the plan and policies, regardless how subordinates felt. Finally, Jack Welch knew there must be some high risk taken behavior in order for changes to take place (Amernic, Craig, & Tourish, 2007). Moreover, he obviously knew, how far to take risks. The strength and weaknesses were in leading the organization. Never the less Jack Welch’s strategy created the standard and benchmarks to instill in his subordinates change at General Electric.

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Jack Welch’s Charismatic Style

Indeed, there is no doubt that Jack Welch had displayed a substantial level of charismatic leadership during his reign at the General Electric. Jack Welch has shown his ability as a transformational leader by continuously trying to inspire and inspire his staff members to be the absolute best that they can be. There are four factors that Welch’s has display he possessed to be a transformational leader: idealized influence (factor 1), inspirational motivation (factor 2), intellectual stimulation (factor 3), and individualized consideration (factor 4) (Northhouse, 2010).Under the term, idealized influence the leader is considered a role model for employees to follow. Welch provided his workforce with his vision, so that they can have an obtainable. Jack Welch is known for having a personality that is out spoken and his has be credited by employees has being the one who spurred growth for general Electric. Welch has conducted idealization influence by decentralizing the entire organization and giving his lower level workers some say so in the decision making process in the company¬†Inspirational motivation (factor2) can be simply¬†considered as inspiration (Northhouse, 2010).

A change leader expects their followers to meet high expectation. Welch had high expectations for the entire business unit in General Electric. He challenged his employees to function to be number one or two in the organization. If any of these units fail to reach these objectives, they would be shut down or put up for sale by Welch. Moreover, this motivated the workforce to maintain Welch’s Goal, because they all had a shared value. Intellectual stimulation (factor 3) Transformation leadership must be able to allow the subordinate in became innovated and not be afraid to challenge their current beliefs to develop a better approach to a process. Jack Welch management techniques were so successful that other organization begins to follow his practices in management (Northhouse, 2010). One particular practice in manage that welch was known. Individualized consideration (factor 4) represents the leader who provides a supportive climate in which they listen carefully to the individual needs of followers (Northhouse, 2010). Moreover, Welch was thought of by his staff as an innovated leader for the individual. Some critic believe that welch management practice were cruel, but in all actuality Welch use plenty of tact and careful planning when it came to down to laying off his employees. Furthermore, many thought that he was being fair because he lay off worker with very bad work performance and even than he gave these employees, a very generous severance pay. Welch believes that his lever level employees should be more involved in the development of General Electric newly evolving organizational culture. They were instrumental in the development of general Electrics’ Mission Statements. Welch’s Techniques created a sense of unity and Sense of belonging in the organization. In addition, Welch always took many trips to the numerous business unites in the company.


Jack Welch’s leadership principles have changed the corporate model, and will be used for many years to come. Welch is well known by many to cut down on staff at the middle management level that job performance. Jack Welch made many milestones at General Electric here is just a few: According Kieser & Hegele, (2001) to Jack Welch, increased General Electric values of shareholder stocks to over 200 dollars a share (Kieser & Hegele, 2001). The profits for General Electric soared to more than $400 billion in revenues in one year. (Kieser & Hegele, 2001) He had a specific focus on development of the employee; begin the process at the hiring stages in the organization until they reach form of leadership position in the company. Finally, one of the main points to the success of Jack Welch tenor at General Electric is his attitude toward communicating constantly the value of the organization and letting employee share their ideas. Jack Welch allowed this practice to happen so that his manger could have a better understanding of their employee’s behavior to improve the overall organization productivity. Welch will place General Electric Company into ever-higher levels of success, After Welch leaves the organization.

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