The restaurant that Jack Welch built

vinay kamat

Jack Welch is always a fascinating read. As the CEO of GE between 1981 and 2001, Welch did what no CEO would have dared to: create a new GE.

For, the GE that Jack was rebuilding was already a global giant. But why did he fix it? That’s the central question every Welch best-seller tries to answer.

In short, Welch saw GE as a nimble giant, not a global goliath. He saw GE as a culture of best practices. And Welch prepared GE to face the future: cost warriors from Asia, particularly China, who are stampeding competition today.

In a Financial Times-PwC survey (Friday, November 18), Welch ranks second among the world’s most respected leaders, after Microsoft’s Bill Gates; he ranks third among the world’s most influential management gurus, after Peter Drucker and Bill Gates. But is Welch really a guru?

Actually, he is a CEO’s guru, a mentor who is able to granularise leadership to a few why’s and why-not’s. In all his books, Jack: Straight from the Gut (which he wrote with John Bryne in 2001), and Winning (which he wrote with his wife Suzy in 2005), Welch exudes the passion and enthusiasm of a Peter Drucker. It’s only his GE-ness (he spent 40 years in GE) that makes his universe of observation smaller. Still, Welch has the ability to bring concepts alive through his experiences as manager, entrepreneur, leader, and writer. It’s like Sony’s Akio Morita constantly bringing a new zing to the repetitive life in the organization.

“There is no perfect business story. I believe that business is a lot like a world-class restaurant. When you peek behind the kitchen doors, the food never looks as good as when it come to your table on fine china perfectly garnished. Business is messy and chaotic,” says Jack, in Straight From The Gut.

In Winning, Welch tells managers where to start: “In my experience, an effective mission statement basically answers one question: How do we intend to win in this business? It requires companies to make choices about people, investments, and other resources, and it prevents them from falling into the common mission trap of asserting they will be all things to all people at all times.”

That’s nothing new; Michael Porter has said that. But Welch also created the templates of implementation; each template was a best practice at GE, like Six Sigma (a quality-enhancing tool). It not only impacted profitability, it gave a new voice to GE’s people.

It’s a mood that Control Your Destiny Or Someone Else Will (the 1993 book written by Noel Tichy and Stratford Sherman) captures completely. Tichy describes the scene in GE’s training centre: “(Ten) young college graduates, all recently hired as GE junior managers, were ferociously debating two propositions scrawled on a flip chart… Jack Welch is the greatest CEO GE has ever had. Jack Welch is an ***hole.”

Such irreverence, notes Tricy, could have only flowed from a culture of openness and confidence. It’s easy to conceptualise such inflection points with a few graphs, PowerPoints, and buzz-words. But the real success lies in institutionalizing something that is constantly changing. That was the restaurant that Jack meticulously built.

on peter senge

Not a knowledge guru, but a community organiser. That's what Peter Senge, 58, would like to call himself. For, the author of Fifth Discipline (1990) and Presence (2004) has focused all his work on creating the learning organization--a community of people who continuously enhance their skill-sets not to survive but to innovate. Senge's organization creates leaders at all levels--learners who function like a networked community. Senge, who met DNA's Vinay Kamat in Mumbai on Monday, speaks about his experiences with companies and CEOs.

Q: Fifteen years after the publication of your book, have organisations become wiser? Or are they still grappling with the basic question: How do we create a learning organisation?

A: It's a pretty difficult world out there. Organisations are under great and constant pressure. The environment has only got tougher the last 15 years. There's more short-term pressure today. But there have been achievements in pockets too. For instance, there's a lot more pressure today on organisations to focus on social responsibility. So, it's a time of cross-currents. Learning is a process that never ends. Remember: all organisations are imperfect. They are laboratories of change.

Q: How do you smell a learning organisation from a distance? How does it pass the Peter Senge test?

A: You know it when you get a sense of enthusiasm. I visited an automobile company in China recently and found quiet energy on the shopfloor. It looked like a life-force: relaxed, focused, not frantic. Have you seen martial artistes practising? There's no wasted energy: there's more outcome from less energy. I saw that kind of energy in the Chinese factory. The people there were eager to learn even after having achieved a lot. They had that one question on their minds: Could you tell us how we can be better?

You discover a spirit of learning in great organisations. People are very excited but they are humble enough to learn. It's so very different from other organisations. Six Sigma, for instance, is a hype created by consultants. Learners don't promote themselves. That's why I don't give examples of companies that have become learners. Now tell me: Can you find a perfect individual? I think it applies to companies too.

Q: Does leadership have to be collective? Doesn't the single leader model work well too? Haven't we seen that in the case of Jack Welch's GE?

A: It's not so, in my opinion. I don't think the single-leader model works. And, at GE, it wasn't Jack Welch alone. Of course, he was a good CEO. But he was always surrounded by talented managers. Often, collective leadership is a hard story to write. So, when you talk of Welch, you must also talk of GE's culture which created its top managers. Welch was certainly one of them.

Q Should learning organisations also have different vision-horizons of say, 10, 20, 30, years?

A: Yes, organisations should have layered vision horizons: 6-month, 5-year, 10-year and 50-year visions. We call them progression of visions. These visions are crucial to the evolution of the company as a learning, and progressive, organisation.

take the drucker test

vinay kamat

If management writing can be simple and clear, why make it complex and intimidating? And, if solutions are obvious, why do writers brand themselves as gurus? You’ll get the answers if you read Peter Ferdinand Drucker, the man who created his muse.

Although he invented the discipline of management, Druckersphere is shorn of hype, fad, mantra, buzz, paranoia, wow. It is a place to unravel yourself; know how to manage your time; realize the value of learning; and understand why results are important. Filled with powerful characters like GM’s Alfred Sloan and AT&T’s Theodore Vail, Drucker’s prose is as understated as Tom Peters’ forewards. When you finish Drucker, you are quietly bewitched by the clarity and linearity of his plot.

Drucker, who died on November 11, could well have passed off as a travel writer. With his acute observations and fascinating anecdotes, he rediscovered the organization for the reader. He peopled it with knowledge workers—resources in quest of superior results. In doing so, he exalted work; it was always something to be contributed, not executed.

In his 1966 book, The Effective Executive, Drucker said his would be the first word. If you read the book, you’ll realize that it’s the last word. Indeed, it’s the most convincing word in management literature. Read it before you read The Concept of the Corporation (the 1946 work based on GM) and The Practice of Management (the 1954 publication focused on tomorrow’s managers). The Effective Executive is the quintessential Drucker because it’s not just an idea; it’s a how-to manual and self-motivation tool as well.

Drucker’s anecdotal touch is the glue that holds the text. One anecdote tells how a President focused on deliverables, not weaknesses. “Lincoln, when told that General Grant, his new commander-in-chief, was fond of the bottle, said: ’If I knew his brand, I’d send a barrel or so of it to some other generals.’” In Grant, Lincoln saw what he wanted: a winner, not a guzzler.

“The first rule in decision-making is that one does not make a decision unless there is a disagreement,” explains Drucker. He elevates this rule with an anecdote from GM. “Alfred Sloan is reported to have said at a meeting of one of his top committees: ‘Gentlemen, I take it we are all in complete agreement on the decision here…Then, I propose we postpone further discussion of this matter until our next meeting to give ourselves time to develop disagreement and perhaps gain some understanding of what the decision is all about.’”

In The Practice of Management, Drucker quotes Jonathan Swift to describe the essence of management: “Whoever makes two blades of grass grow where only one grew before deserves better of mankind than any speculative philosopher or metaphysical system builder.”

Drucker grew two blades of grass too by contributing to the growth of the new corporation. It was an effort worth applauding. For, it also created a benchmark for ideating and writing.

unbrand yourself

vinay kamat

Try this one. How about getting yourself a brand manager? If companies have them, why can’t people? If the idea still sounds far-fetched, it’s because we think we can easily manage ourselves. So, we try to shore up strengths that we think are right. Well, they may be the wrong ones.
Simple idea. Too tough to implement. It’s been around though in many avatars. Maverick management guru, Tom Peters, popularised the concept of Brand You and Me Inc. What he said was attention-grabbing. Since then, converts have marketed themselves in their organisations by showcasing — or showcausing — their pluses. They have stopped being human resources. Instead, they have become human brands. They have realised that peer perception is as important as individual excellence.
The idea of self-branding was given a new spin by a CXO (a chief something, or everything, officer) I met last week, who has used it to climb up, and across, hierarchical ladders. His formula may sound like journalist Naomi Klein’s argument against an over-branded world; it’s actually a product extension of Jack Welch’s famous rule: Control your destiny or someone else will.
The CXO’s tried and tested mantra: Unbrand You. As you’ll see, it’s a deeper look at yourself.
Debrand yourself: “Companies get locked into the brands they create; individuals should not. Sony can never make cars, for instance. But you and I can change our careers if we want to. And, in an era where careers are shortening, how can you create Brand You around one career? You need to be as flexible as possible in positioning yourself just as you need to diversify your skill-set.”
Think community: “The future of pharma is generics; the future of technology is open source. Why can’t the future of careers be communities? As work increasingly gets outsourced, the individual’s ability to fit into virtual teams will be the biggest plus. A community chain, unlike a value chain, is based on personal relationships. Here, your ability to communicate laterally, not vertically, creates a feeling of oneness.”
Get yourself a brand manager: “If you can have your own financial planner and medical counsellor, why can’t you have your own brand manager. It’s not to create a brand but to help you not to create one. The best place to find a brand manager is your organisation. Your colleague could be the best choice: he would know where your shoe screeches or why your ring-tone affects sensibilities. By conducting a daily performance appraisal, he can tell you why you are making zero-impact in the corner room. He can even give you an indication of your internal and external market values, map your next career move, and conduct informal peer surveys to gauge your popularity. And if you still want to tag yourself, he would position you as a Walmart rather than a Prada. For, accessibility, not attitude, is the key to Unbrand You.”
“An eye is a new way of viewing something old,” says fashion designer Vera Wang, in Newsweek. Perhaps the CXO’s eye is an attempt to view careers in a new way. It’s an attempt to present oneself without using PowerPoint. It’s a nice way to be different.

mega mantra

vinay kamat

Name the mother of all management mantras. Name the mantra that companies and individuals can’t do without. Name the slogan that has the highest recall. Name the chant that's a wellness recipe as well.

It's called Positioning and it was introduced by Al Ries and Jack Trout in 1972. Until then, nobody had even thought of structuring the idea of positioning. What they said was pretty obvious: "To succeed in our over-communicated society, a company must create a position in the prospect's mind, a position that takes into consideration not only a company's own strengths and weaknesses, but those of its competitors as well."

Since then, Nike has positioned itself as the "just do it" brand, Apple as the "think different" company, Volvo as the purveyor of "safety." The idea of positioning was further simplified by Jack Trout in his book Differentiate or Die. “Being different,” says Trout, “often requires going against conventional thinking. You have to have the guts to go against what is often conventional wisdom.”

Needless to say, positioning is the world’s most powerful survival, or revival, mantra. It’s your lifebuoy-cum-booster. Positioning could be an ideological statement like Coca-Cola’s (the classic image) or Pepsi’s (the new-generation persona). It could be a cultural manifestation like Toyota’s (operational excellence) and Sony’s (innovation). It could be the assertion of identity like BMW’s (driver’s car) and Merc’s (top-class engineering). It could even be a connect with legacy like Cadillac’s (standard of the world) or VW’s (think small).

Positioning is the company’s belief in itself, its competencies, its people, and its vision. Some have called it shop-floor spiritualism; others have fondly referred to it as the wellness recipe. For, employees can motivate themselves only if they are encouraged to position themselves within the company so that the company can, in turn, position itself in the marketplace. An organization that articulates its positioning well to its employees has no stereotypes; it buzzes with individuals.

Michael Porter’s strategic fit (configuring your value chain to reflect strengths and strategic trade-offs) and C.K. Prahalad’s and Gary Hamel’s core competence (your basic strength that gives a competitive edge) are all manifestations of positioning.

Positioning is an attitude that is hard to miss. It becomes a war-cry when you are sure of yourself. China’s online guru-cum-entrepreneur Jack Ma is definitely sure of his. “Ebay may be a shark in the ocean, but I am a crocodile in the Yangtze River. If we fight in the ocean, we lose--but if we fight in the river, we win," he told Forbes magazine.

Jack Ma’s stance is not just strategic intent. It is a positioning statement for a local firm that is preparing for battle with a transnational. It defines the game, the domain, the players’ strengths and weaknesses, and the game-plan.

Indeed, it’s not just positioning. It’s an awakening. That is the power of positioning yourself in you adversary’s mind.