Jack Welch, long-term CEO of General Electric, died on Sunday March 1, 2020. He was an inspiration for my own and many other people’s writing on careers, and ahead of his time in promoting, even demanding, career ownership. A brief account of his legacy over your career, drawn from GE’s Annual Reports from the early 1990s, goes like this.
A Boundaryless Company
In early 1990, Welch was the lead author of an Annual Report To Shareholders claiming that in the previous decade GE had “challenged the bureaucracy and generally got the better of it.” He adds what may sound like music to a career owner’s ears, “The cool efficiency that many have always associated with business leadership must give way to personal skills and traits like empowering, listening, passion, energy and the capacity to transmit that energy to others.” He continues, “Our dream for the 1990s is a boundaryless company, a company where we knock down the walls that separate us from each other on the inside and from our key constituencies on the outside.”
He further asserts, “We want GE to become a company where people come to work every day in a rush to try something they woke up thinking about the night before. We want them to go home from work wanting to talk about what they did that day, rather than trying to forget about it. We want factories where the whistle blows and everyone wonders where the time went, and someone suddenly wonders aloud why we need a whistle. We want a company where people find a better way, every day, of doing things; and where by shaping their own work experience, they make their lives better and your company best.”
That’s not usually the kind of stuff CEOs write in their annual reports, but Welch was ready to take on the naysayers “Far-fetched? Fuzzy? Soft? Naive? Not a bit. This is the type of liberated, involved, excited, boundaryless culture that is present in successful start-up enterprises.” He acknowledges this is unheard of for an institution of GE’s size, but “we want it, and we are determined we will have it.” It was clear he wanted career ownership, even if he expected it all to be directed for GE’s benefit.
A Vote For Self-Confidence
The next year, Welch reasserts GE’s established mantra that “only businesses that were number-one or number-two in their markets could win in the increasingly competitive global arena.” As a result, over the past decade GE had divested $10 billion worth of business and invested $19 billion in acquisitions. Welch was on his way to earning the label of “Neutron Jack” for the disruption this policy caused. In contrast, he credits GE people as able to “understand that slow-and-steady is a ticket to the boneyard” and needing “the power, the freedom and the tools” to promote the pace of change necessary for continued success.
To support his point Welch chastises what he sees as mainstream management practice, of frequently adding the term “manager” to people’s titles. In turn, “Managers, logically enough, see their mandate as managing: controlling, measuring and getting on top of things.” In doing so, they “unconsciously carve out fiefdoms and then feel compelled to defend them.” That in turn creates insecurity for other workers. The antidote for Welch, which was built directly into his model for business success, was “to create an atmosphere where self-confidence can grow” within each and every GE employee.
The straightforward approach to building self-confidence was “work-outs” or “town meetings” among all levels of employees to identify unnecessary or inefficient work practices. Being seen as a valued contributor to the overall work builds self-confidence. That in turn creates a more boundaryless vision and faster speed of delivery or innovation. The model behind this thinking is shown below.
De-Layering
A further message to shareholders continues to challenge the traditional structure of GE and the hierarchical layers that employees had traditionally seen as markers of career success. “Layers insulate. They slow things down. They garble. Leaders in highly layered organizations are like people who wear several sweaters outside on a freezing winter day.” Those leaders feel warm and comfortable but are blissfully ignorant of what’s going on around them. Welch’s solution was “boundaryless behavior” as the means to turn opportunities into reality, and to create value for his multi-business company.
Welch also introduces a typology of leader behavior to help his cause. The first type “delivers on commitments” and shares the values of the company; the second type offers neither of those things. Both are easy calls in terms of their career futures. The third type share the values but misses commitments, so is likely to get an second chance. Then there’s the fourth type who delivers on commitments but doesn’t share the company’s values, the person “who typically forces performance out of people rather than inspires it… the autocrat, the big shot, the tyrant.” Autocrats, we are told, stood in the way of an 80% drop in the cycle time of new milling machines now operated without supervision.
A Small Company Atmosphere
In a later message, Welch writes, “We love the way small companies communicate: with simple, straightforward, passionate argument rather than jargon-fined memos.” Small companies have to face the reality of the market every day. Moving with speed is their path to survival. A sense of urgency, and a focus on what really matters provides “a vaccine against bureaucracy and lethargy.” By contrast a lack of speed is what gets big companies into trouble.
The answer? Boundarylessness can serve as a ”behavior definer,” as a way of “getting people outside of their organizational boxes and working together, faster.” It can also be a way of getting people closer to customers, suppliers and other constituencies on which GE depends, and delivering “quick market intelligence” to drive everyone’s adaptation to a changing world.
Tough Career Questions
Looking ahead, Welch listed a series of “tough questions” every person in every business ought to ask themselves. They are summarized as follows:
• Am I facing reality? Am I painting flattering self-portraits, or looking honestly in the mirror? And when I have grasped the reality, am I acting on it fast enough?
• Do I see a competitor beating us with lower prices and claim “he’s nuts” or “he’s dumping.” Is the real answer “I’d better get my costs down now, or I’m gone”?
• Do I take comfort saying competitors are “spending too much on product development”? Or do I focus on their faster cycle time beating me to the marketplace?
• Do I wait in hope of some dozing manager suddenly springing into action? Does that mean I lack the courage to make the tough calls I need to make?
• Do I shrug in resignation at slow growth, and wait for new government bureaucrats to “fix the economy”? Am I frightened and paralyzed by change?
The messaging went on until 2001, when Welch resigned after 20 years of remarkable growth. A few years after he left, the company’s fortunes changed. But that’s another story.
A final word
The concept of the boundaryless company gave rise to that of The Boundaryless Career, which was largely loyal to the vision of the highly committed and collaborative worker described above. However, the developers of the boundaryless career concept took note of a) average employment periods of 5-8 years in Western economies; b) the unpredictable future of jobs pushing innovation; and c) the project-based nature of jobs in, for example, the construction and film industries. We therefore added that long-term employability was the individual’s not the company’s responsibility. With that in mind, you are invited you to remember Jack Welch by hearing his challenge below.
“When most of us look at our careers, if we are honest with ourselves about decisions we’ve made, changes we’ve brought about, we have to acknowledge that there was much wishing and hoping and temporizing that has slowed us in coming to grips with reality. But beyond that, our biggest regrets – sometimes our most bitter ones – are often that once we defined reality, and brought it into focus – we didn’t act fast enough, boldly enough.“
What do you say?
Postscript: After Welch introduced the idea of “The Boundaryless Organization” in 1990, it gained enough traction by 1993 for the Academy of Management to adopt the theme “Managing The Boundaryless Organization” for its Annual Meeting in Atlanta, Georgia. A group of participants offered a modest symposium on “The Boundaryless Career,” suggesting that in an era of restructuring and downsizing people “knock down the walls” in pursuing their careers. A book with the same title was published in 1996. Since that time, the idea has been referenced in over 9,000 scholarly articles.
(Special thanks to Lotte Bailyn, Michael Best, Allan Bird, Ronald Burt, Robert DeFillippi, Tim Hall, Monica Higgins, Kerr Inkson, Candace Jones, Barbara Lawrence, Phil Mirvis, Polly Parker, Denise Rousseau, AnnaLee Saxenian, David Thomas, Pamela Tolbert, John Van Maanen and Karl Weick who supported the 1996 book and continue to pursue related work today. Many thanks also to everyone who has joined the conversation since that time.)
