A Monthly Publication from Citrin Consulting
November | 2011


IN THIS ISSUE

Courageous Leadership

TED Talks

The Resilience Advantage

Absolute Citrin

 
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Courageous Leadership

It's About the People

After just a year of working for General Electric as a junior engineer in Pittsfield, MA, Jack Welch felt stifled by the bureaucracy and poor management style of his bosses and decided to take a new position with a chemical company in Illinois. Just a few days before his going away party, a young executive, Reuben Gutoff, who saw Welch's potential, invited Jack and his wife out to dinner to try to cajole him to stay with the company. Gutoff promised Welch that he would free him from red tape management and would help him create a more flexible and workable environment. Before accepting his offer, Welch challenged him by telling him that he "was on trial" to see if he could actually create that kind of workplace for him. Gutoff accepted the challenge "Oh, by the way" he also told Gutoff, "I'm still going to have that party because I like parties and I think they have some little presents for me".

Twenty years after that event in 1981, Jack Welch was named CEO of GE. The company had a market value of $14 billion. When he left in 2001, GE's market value had grown to $410 billion. In 1999, Fortune magazine named him CEO of the Century. There are many aspects of Jack Welch's tenure that sets him apart from other CEO's including his strategies of just focusing on product lines in which GE could maintain a #1 or #2 placement in the market or his focus on quality improvement strategies such as Six-Sigma that GE used to differentiate themselves from their competitors. For our discussion however, the focus is on how Jack Welch recognized and addressed getting the best people to work at GE.

When asked what is the most important about their company, every CEO and senior leader will say, "Our People", but how many leaders understand what bringing out the best in their people really means. To Jack Welch, that meant developing systems that would help GE bring on, develop, care for, and create the talent that would drive organizational success. At the heart of the process is GE's Session C reviews in which all the leaders at GE were systematically reviewed, evaluated and provided plans to strengthen their leadership skills.

Now most organizations do employee performance reviews annually and usually involve the employee and his or her direct supervisor. For Welch and his team, the process could take most of April and May of every year. Along with his key senior executives he would visit 12 different business units and review the progress of the top 3000 executives. Typically the sessions began at 8 AM and ended at 10 PM with the CEO, senior HR executives, and direct supervisors of the people being reviewed staying for the entire day. Welch required that everyone be "brutally honest" about how they saw the progress and potential of those employees being evaluated. The goal was to find leaders who had what he called the E to the fourth power of the 4 E's (and he later added a "P"). They went like this:

  1. Positive Energy — This translated to people who thrived on action, relished change, were optimistic and loved to play
  2. Energize Others — These leaders inspired their team and others to take on the impossible and to have fun while doing it.
  3. Edge — The courage to make tough yes or no decisions. Welch would say the world is filled with gray. Make your choice and make the call.
  4. Execute — Its great to have people with all the above qualities but unless they deliver results, so what?
  5. Passion — Welch looked for leaders who so deeply believed in the work being done that they had an authenticity to their leadership that transformed those around them.

Jack Welch believed in rewarding accomplishment so employees in the top 20% received handsome bonuses while those at the bottom were usually counseled out of the company. The middle group were encouraged to grow in their path and work to achieve better results. Jack Welch was clear about his role at GE. He still states that his "…main job was developing talent. I was a gardener providing water and other nourishment to our top 750 people. Of course, I had to pull out some weeds, too".

Consider how you lead your team and how you can do a better job of fairly evaluating their current and potential capacities for greatness—as employees and people. In my experience of undertaking talent assessments, I along with my clients are usually surprised about how much managers don't know about their employees and how a simple process similar to what GE does can help you find and gain more from your staff—for everyone's benefit.

 

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TED Talks

Pamela Meyer believes that the pursuit of truth requires us to understand deception and she's providing everyone with the tools to accomplish it. Check out her presentation on Lie Spotting. It's a bit long at 18 minutes but it will definitely validate what you thought when Bill Clinton lied to you and me.

 

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The Resilience Advantage

If you've not downloaded my latest e-booklet on resilience, please go to my website, www.citrinconsulting.com and click on the link at the bottom of the page.

 

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Podcast Series: "Absolute Citrin"

Please check out my new podcast Series "Absolute Citrin". My latest discussion is built on the ideas in the Resilience Advantage and you can subscribe to these free podcasts by going to itunes and searching for Richard Citrin.

 

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