Update and Caution: August 10, 2022: We are both elated and worried about the wild popularity of this post from 2011. Serious questions are being raised about Jack Welch’s style, as depicted in this post. See recent criticism by David Gelles in “The Man Who Broke Capitalism: How Jack Welch Gutted the Heartland and Crushed the Soul of Corporate America―and How to Undo His Legacy.” Some GE managers who worked during Welch’s time seem to agree though ex-Home Depot CEO Bob Nardelli is still a steadfast supporter of Jack Welch’s leadership style. Welch was widely considered “the manager of the century.” The Jack Welch century was the 20th Century. Do check out what seems to be working in leadership in 2022. Leadership Style 2022: Jack Welch or Satya Nadella?
This blog had discussed Jack Welch’s 4E’s and one P in an earlier post; given the interest among blog readers, here is some more clarification about the concept.
To evaluate managers, GE started a system of differentiating managers on performance but was hard pressed to identify the characteristics that differentiated managers on the “Vitality” curve, which is essentially a “grading” curve or graph for managers. The word “vitality” is confusing because it refers more to being vital or essential to the organization rather than being “vital” in the “having high energy” sense. In fact, “Energy” is one of the 4 E’s but let’s go over the 4 E’s of GE leadership briefly:
- Energy: High personal energy of the manager is important. It reminds me of a boss who used to watch the speed at which you walked in the corridor! It sounds weird, but someone who is mostly lethargic in walking up and down does give off a “low energy” vibe.
- Energize others: Do you brighten up a co-worker’s mood? Or do co-workers feel down after interacting with you?
- Edge: Can you make tough decisions that are Yes/No without fear of being disliked? Welch found that many managers have two or even three of the above “E’s” and did not seem to click to be put in the top 20% of the curve. “Execution” was this missing 4th E which is this blog’s favorite managerial and leadership ability.
- Execution: Can you deliver? Let us say that you are a supply chain manager who is responsible for engaging a few small high-tech innovative suppliers for a new component development for a new product project. You asked one of your buyers to send out emails from the supplier database, and perhaps none of the suppliers responded. When you show up for the new product top team meeting, you just say that suppliers are not responding. Well, you are not “executing.”
The “execution” focused manager would have figured out why suppliers were not responding ( perhaps small suppliers worried about volumes down the road before investing), then would have put out a “development” financial advance proposal and discussed, offline, how much the new product team was willing to spend in supporting a new supplier. High “ability to execute” is the manager who walks in with the prototype of the component into the next meeting with no excuses.
Such managers do not promise anything easily. Once they do, top management or the board knows it can “consider it done”!
5.Passion: is the “P” in the 4 E’s and one P. A manager passionate about her/his job goals normally has some of the first 3 E’s and must focus a great deal on executing. Passion is what holds the 4 E’s together for the top 20% performers.