Jack Welch, CEO of General Electric for past two decades passed away on Sunday, at the age of 84. Welch was surrounded by his friends and family as he breathed his last. His wife, Suzy, said that the cause of his death was renal failure.
Welch was a railroad conductor’s son who rose to success and became the CEO of GE, and grew its market value from $ 12 billion to $410 billion in mere 20 years.
Offering condolences to his family and expressing grief at his demise, US president Donald Trump tweeted, ” Jack Welch, former Chairman and CEO of GE, a business legend, has died. There was no corporate leader like “neutron” Jack. He was my friend and supporter. We made wonderful deals together. He will never be forgotten. My warmest sympathies to his wonderful wife & family!’
In 2015 Welch attended the TiEcon Silicon Valley in 2015, where he said that innovation was more important now than ever before and organizations have to be flatter to ensure that.
“Organizations have to be flat so that they can act with speed, minimum layers and there has to be a culture of risk taking where the support of taking risk is large. Everything has to be fast so innovation is critical to survival”, he said in an interview.
Commenting on the issue of a global talent pool in the 21st century he said, “The big thing is not talent, but where talent meets money. The reason why the US is winning, whether they have Indians or Chinese, or anybody else is because they have a pool of money. It’s typical for venture capital to meet ideas and marry quickly and other countries don’t have that in the same degree. There are pools of capital here that are always looking for ideas and you don’t have that in other countries.”
Venktesh Shukla, former TiE president recalling Welch as a grand keynote in 2015 when he was the TiE Silicon Valley president told indica, “Very sad to hear of the passing away of Jack Welch.”
“I called him to invite him to speak at TiEcon. He told me that it was him that made the strategic decision to build one of the biggest development centers for GE in India in the late 80’s – early 90’s,” said Shukla and added he had made a visit to India before that and he was hugely impressed by the brain power of people he met – not just people in the industry and scientists but also politicians and bureaucrats.
He figured that GE had to benefit from the enormous brain power that India offered and decided to make a huge investment there.
Shukla believes, Welch’s passion and energy was infectious. While speaking at TiEcon, he could barely contain himself while talking about his management principles as they related to recruiting and grooming talent. Some of his ideas were no longer fashionable in the tech industry but he had the conviction to fight for his ideas and it showed.
“He was a legend in his lifetime,” Shukla said. “His management principles influenced a whole generation of managers in corporate America and we were lucky to have him in our midst.”
With a determination to win by busting up bureaucratic complacency, Welch earned two titles — “manager of the century,” and “Neutron Jack,” the latter for slashing tens of thousands of jobs. Welch had said he hated the nickname. Under his leadership, GE became the world’s most valuable company, after Microsoft. Its fortunes later turned south, CNN reported.
While at the helm, Welch bought and sold scores of businesses, expanding the industrial giant into financial services and consulting. GE Capital Bank was founded seven years into his tenure. His acquisitions included RCA — then-owner of NBC — and Kidder Peabody, the brokerage that became entangled in an insider trading scandal.
John Francis Welch Jr. was born Nov. 19, 1935, in Peabody, Massachusetts, to Irish American parents. His father was a conductor for the Boston & Maine Railroad and his mother was a homemaker. The younger Welch studied chemical engineering at the University of Massachusetts Amherst and received his Ph.D. from the University of Illinois in 1960.
Welch joined GE in 1960 as a chemical engineer in its plastics division in Pittsfield, Massachusetts. He became a vice president in 1972 and vice chairman seven years later. In April 1981, at age 45, he succeeded Reginald H. Jones as chairman and chief executive officer.
Welch insisted that all of GE’s divisions be market leaders. ″Fix it, close it or sell it,” he was fond of saying.
Welch invented the “vitality curve,” in which managers were ranked into three groups. The top 20% “A” group was “filled with passion, committed to making things happen.” The “vital” 70% “B” group was essential to the company and encouraged to join the A’s. Then there was the bottom 10% “C” group. “The underperformers generally had to go,” Welch said in his 2001 book, “Jack: Straight From the Gut.”
According to the book, “the workforce went from 411,000 to 299,000 during his first five years as chief. With such cuts, he acquired the derisive moniker named after the neutron bomb, which was designed to kill multitudes without destroying cities.
Welch, who played a key role in the creation of CNBC in 1989, retired from GE in September 2001, days before the 9/11 attacks. Upon his retirement, The New York Times published an editorial that gushed over his professional record.
“Mr. Welch was a white-collar revolutionary, bent throughout his career at G.E. on championing radical change and smashing the complacency of the established order,” the editorial said. “His legacy is not only a changed G.E., but a changed American corporate ethos, one that prizes nimbleness, speed and regeneration over older ideals like stability, loyalty and permanence.”
A funeral will be held a New York’s St. Patrick’s Cathedral. The date has not been set.
“More than anything else — leader, business icon, management genius — more than those things, although they are all true too — Jack was a lifeforce made of love,” Suzy Welch said in a statement Monday. “Pure, bright, undiminishable love. His irrepressible passion for people, all people, his brilliant curiosity about every-single-thing-on-earth, his gargantuan generosity of spirit toward friends and strangers alike — they added up to a man who was superhuman yet completely human at once. He changed the world by touching people deeply and authentically, helping them see and reach dreams they couldn’t even imagine for themselves. And somehow, crazily somehow, he also managed to be the greatest husband and step-father who ever lived, giving our family twenty amazing years of adventure, happiness, and joy. Our hearts, so much larger and fuller having known and loved him, are broken.”