Innovation and Leadership Tips from Jack Welch
Article by Kerri Salls
Jack Welch may be the most talked about and widely emulated manager in business history. Using instincts and unique leadership strategies, he increased the market value of General Electric by more than 0 billion over two decades. So when Jack talks, I listen. That was the case at the Boston University Graduate School of Management Annual Symposium on Innovation I attended. Jack Welch was the morning keynote speaker. Here are some of the truffles he shared from his stories, insights and experience.
1. Your business must be efficient and it must produce results. To compete, you must innovate. There is no choosing to one or the other, leaders must do both.
2. Leaders must encourage and cultivate innovation in individuals and in groups; you have to be looking around for ideas every minute and always be open to collaboration. Be sure to keep those innovators around you. Rather than punish innovators who fail, reward them. Make them heroes for taking a swing. That will motivate them to keep trying and motivate everyone else that it's okay to try.
3. You get the behavior you reward. So if you punish innovators for failing, that's what you'll get. If you take ownership of the failure (because you're the boss and leader of the team), and keep swinging yourself, you model what you expect from the whole team. If you encourage, motivate and reward the effort, that's what you'll get. If you encourage risk- taking or innovation, that's what you'll get. If you ignore it, you won't get it.
4. Innovation has to be based on a WOW. You have to be able to sell it: why it's a fit for the company or market, and show your reasons for the "ah hah" light bulb. You have to believe in it, go after it, and have passion to back up the rational commitment.
5. Live your core competency. For GE it was building people. For GE, good performance gets a manager in the game. But it is values, tightly aligned to the company values, that move you forward. In Jack's experience, someone who is a whiz at the numbers but is "a horse's ass" to work with will break a company. It's a bad compromise.
6. No country has a confluence of energy, money and ideas like the US. So if you have an idea, go for it. Our Venture Capital market in the US is miles ahead of everyone else with buckets of money for entrepreneurs. "If not now, when?"
7. See everything as a race. Speed is a value - it may be your company's value. If speed is important, a single individual can screw up a big company. But what can be worse, a single individual does screw up a small company.
8. When asked about leadership, Jack Welch answered: "Leadership is everything". Your leadership sets the vision and determines the behaviors you want, in order to achieve that vision. You need everyone on the same page. You want your vision under their skin so they buy in completely to what you are about, what you stand for. Leaders must decide what's important, why it's important and where they are going.
9. Make everything you do public - all rewards and discussions. Keeping it private does not help you.
10. Profit is a by-product of success, not the objective. The objective should be to take an idea and create value in the marketplace. That innovation is in the heart and spirit of a company. So the biggest mistake is to get that new management job and continue to do the old job - the one you know.
11. Surround yourself with smart people. They keep you out of blind spots. They are moving. They are innovative - ready to change the world. They can be clients, investors, team members.
12. Jack Welch acknowledged a couple of things that can trip you up when starting out: Lack of focus. For example, you are sacrificing the future of the business when you focus on one current client exclusively. Control. If you own the business, you have control. As soon as you bring in a board of directors, venture capitalists or angels they have control.
13. By definition, successful entrepreneurs have a passion for what they are doing. That passion has to sustain you for a long time. Passion overcomes risk and leads risk because that belief in what you are doing is bigger that the risk. Entrepreneurs have to be comfortable with risk, always looking for new ways to do things.
14. Entrepreneurs must have three characteristics: They must be good at recognizing opportunities - and the limits of those opportunities. They must be insatiably passionate about their idea. They must be able to focus strategically on the deliberate action required. And, entrepreneurs must be able to keep all three balanced - like an acrobat.
For this audience of budding and alumni MBAs, Jack Welch was adamant that it's not the idea for your company/product that is most important. Rather, it's the execution and building the business that outweighs the importance of the original idea. These principles apply to a new business forming, a sole proprietor as well as to businesses in place for decades.