Introduction
In 1981, 45-year-old Jack Welch became the eighth and youngest CEO in General Electric’s history. During his 20 years at the helm, Welch transformed the company from an aging industrial manufacturer into one of the world’s most competitive organisations, by building more shareholder wealth than any corporate chief in history. Time and again he reinvented the company, and time and again, his employees went along with it (Krames, 2002).
The paradigm of transformational leadership is useful in analysing how he was able to accomplish this (Dubrin, Dalglish & Miller, 2006). It is also useful in identifying the personal characteristics, the leader and follower values and the situational factors that contributed to his success.
This paper will analyse Welch’s leadership of GE using the framework of transformational leadership. Conclusions will be drawn regarding Welch’s leader behaviour and effectiveness, taking into account the situation, the nature of the followers, Welch’s values and the international and cultural context.
Jack Welch
Welch performed a number of leadership roles that contributed to his achievements as CEO. Gardner (1989, as cited in Dalglish & Evans, 2005 ) identifies nine main tasks of leadership: envisioning goals, affirming values, motivating, managing, achieving workable unity, explaining, serving as a symbol, representing the group and renewing.
When Welch took over at GE, corporate America revered large bureaucracies as critical for close monitoring of personnel and it had placed great faith in a command-and-control management system (Slater, 2003). Although GE was regarded by many as a model organisation, Welch recognised that new global competition and poor economic conditio ...