c


"c
"  
c (born November 19, 1935) is an American businessman and author. He
[1]
was Chairman and CEO of General Electricbetween 1981 and 2001. Welch's net worth is estimated at $720 million.

Jack Welch was born in Salem, Massachusetts to John, a Boston & Maine Railroad conductor, and Grace, a

homemaker.

Welch attended Salem High School and later the University of Massachusetts Amherst, graduating in 1957 with

a Bachelor of Science degree in chemical engineering. While at UMass he was a member of the Alpha chapter of

the Phi Sigma Kappa fraternity.

Welch went on to receive his M.S. and Ph.D at the University of Illinois at Urbana-Champaign in 1960.

Welch joined General Electric in 1960. He worked as a junior engineer in Pittsfield, Massachusetts, at a salary of
[2]
$10,500 annually. While at GE, he blew off the roof of the factory, and was almost fired for doing so. Welch was

displeased with the $1,000 raise he was offered after his first year, as well as the strict bureaucracy within GE. He

planned to leave the company to work with International Minerals & Chemicals in Skokie, Illinois.

Reuben Gutoff, a young executive two levels higher than Welch, decided that the man was too valuable a resource for

the company to lose. He took Welch and h is first wife Carolyn out to dinner at the Yellow Aster in Pittsfield, and spent

four hours trying to convince Welch to stay. Gutoff vowed to work to change the bureaucracy to create a small -company

environment.

"ü
," Gutoff remembers pleading. " 

  
  
      

 

   
 ." "
 
 ," retorted Welch. "  
 ,"

Gutoff said. " ü   
  

 ." At daybreak, Welch gave him his answer. " 
  

 
 
," recalls Gutoff. " 

 

  
  


  

 
  
   " Some 12 years later, Welch would
[3]
audaciously write in his annual performance review that his long-term goal was to become CEO.

Welch was named a vice president of GE in 1972. He moved up the ranks to become senior vice president in 1977 and

vice chairman in 1979. Welch became GE's youngest chairman and CEO in 1981, succeeding Reginald H. Jones. By

1982, Welch had disassembled much of the earlier management put together by Jones.

[edit] Tenure as CEO of GE

Through the 1980s, Welch worked to streamline GE. In 1981 he made a speech in New York City called "Growing fast
[4]
in a slow-growth economy". This is often acknowledged as the "dawn" of the obsession with shareholder value. Later,

in an interview with the Financial Times on the Global financial crisis of 2008±2009, Welch said, ³On the face of it,

shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy... your main

constituencies are your employees, your customers and your products.´ [5]

He also pushed the managers of the businesses he kept to become more productive. Welch worked to eradicate

perceived inefficiency by trimming inventories and dismantling the bureaucracy that had almost led him to leave GE in

the past. He shut down factories, reduced payrolls and cut lackluster old-line units.[6] Welch's public philosophy was that
a company should be either #1 or #2 in a particular industry, or else leave it completely. Welch's strategy was later

adopted by other CEOs across corporate America.

Each year, Welch would fire the bottom 10% of his managers. He earned a reputation for brutal candor in his meetings

with executives. He would push his managers to perform, but he would reward those in the top 20% with bonuses and

stock options. He also expanded the broadness of the stock options program at GE from just top executives to nearly

one third of all employees. Welch is also known for destroying the nine-layer management hierarchy and bringing a

sense of informality to the company.

During the early 1980s he was dubbed "Neutron Jack" (in reference to the neutron bomb) for eliminating employees

while leaving buildings intact. In !" # ü$
, Welch states that GE had 411,000 employees at the end

of 1980, and 299,000 at the end of 1985. Of the 112,000 who left the payroll, 37,000 were in sold businesses, and

81,000 were reduced in continuing businesses. In return, GE had increased its market capital tremendously.

In 1986, GE acquired NBC, which was located in Rockefeller Center; Welch subsequently took up an office in the GE

Building at 30 Rockefeller Plaza. During the 1990s, Welch shifted GE business from manufacturing to financial services

through numerous acquisitions.

Welch adopted Motorola's Six Sigma quality program in late 1995. In 1980, the year before Welch became CEO, GE

recorded revenues of roughly $26.8 billion. In 2000, the year before he left, the revenues increased to nearly $130

billion. When Jack Welch left GE, the company had gone from a market value of $14 billion to one of more than $410

billion at the end of 2004, making it the most valuable and largest company in the world.

At the time of his retirement, Welch received a salary of $4 million a year, followed by his controversial retirement plan
[7]
of $8 million a year. In 1999 he was named "Manager of the Century" by Fortune magazine.

There was a lengthy and well-publicized succession planning saga prior to his retirement between James

McNerney, Robert Nardelli, and Jeffrey Immelt, with Immelt eventually selected to succeed him as Chairman and CEO.

Nardelli became the CEO of Home Depot until his resignation in early 2007, and until recently, was the CEO

of Chrysler, while McNerney became CEO of 3M until he left that post to serve in the same capacity at Boeing.

[edit]Criticism

Some industry analysts claim that Welch is given too much credit for GE's success. They contend that individual

managers are largely responsible for the company's success. [8] For example GE Capital, under Gary C. Wendt,

contributed nearly 40% of the company's total earnings while NBC and Robert C. Wright worked to turn the network

around, leading to five years of double-digit earnings growth. It is also held that Welch did not rescue GE from great

losses as the company had 16% annual earnings growth during the tenure of his predecessor, Reginald H. Jones.

Critics also say that "the pressure Welch imposes leads some employees to cut corners, possibly contributing to some

of the defense-contracting scandals that have plagued GE, or to the humiliating Kidder, Peabody & Co. bond-trading

scheme of the early 1990s that generated bogus profits". [3]

Welch has also received criticism over the years for an apparent lack of compassion for the middle class and working

class. Welch has publicly stated that he is not concerned with the discrepancy between the salaries of top-paid CEOs
and those of average workers. When asked about the issue of excessive CEO pay, Welch has stated that such

allegations are "outrageous" and has vehemently opposed proposed SEC regulations affecting executive

compensation. Countering the public uproar over excessive executive pay (including backdating stock options, golden

parachutes for nonperformance, and extravagant retirement packages), Welch stated that CEO compensation should

continue to be dictated by the free market, without interference from government or other outside agencies. [9] In

addition, Welch is a vocal opponent of the Sarbanes-Oxley Act of 2002.[10]

[edit] Personal life

Welch has had a slight stutter since childhood. He had four children with his first wife, Carolyn. They divorced amicably

in April 1987 after 28 years of marriage. His second wife, Jane Beasley, was a former mergers-and-acquisitions lawyer.

She married Jack in April 1989, and they divorced in 2003. While Welch had crafted a prenuptial agreement, Beasley

insisted on a ten-year time limit to its applicability, and thus she was able to leave the marriage with an amount believed

to be in the range of $180 million.[11]

The third wife of Jack Welch is Suzy Wetlaufer, who co-authored his 2005 book 


 as Suzy Welch. Wetlaufer

served briefly as the editor-in-chief of the %  


& before being forced to resign in early 2002 after

admitting to having been involved in an affair with Welch while preparing an interview with him for the magazine.

Welch underwent triple bypass surgery in May 1995. He returned to work full time in September of the same year and

also adopted an exercise schedule that included golf. Welch is a member ofAugusta National Golf Club. However,

in 


, Welch acknowledges that back problems forced him to give up playing golf, and that, surprisingly, he

doesn't miss it. He acknowledges using his time formerly spent on the golf course to consult with companies and

indulge other personal interests such as modern art, international travel, teaching and attending Red Sox games. Since

then, he has picked up his golf game, playing at courses such as Nantucket Golf Club, Sankaty Head Golf Club, and the

Country Club of Fairfield, CT, among others.

On January 25, 2006, Welch gave his name to Sacred Heart University's College of Business, which will be known as

the "John F. Welch College of Business". [12]

Since September 2006, Welch has been teaching a class at the MIT Sloan School of Management to a hand-picked
[13]
group of 30 MBA students with a demonstrated career interest in leadership. He is also a global

warming skeptic.[14] Yet he has said that every business must embrace green products and green ways of doing
[15]
business, "whether you believe in global warming or not...because the world wants these products."

Thanks to a donation from Jack Welch the Jack Welch Management Institute at the Chancellor University in Ohio was

founded in July 2009. The institute offers a MBA program based on Welch's management philosophy. Classes are

offered both online and at the school¶s Cleveland campus.[16]

On March 11, 2010, Welch appeared as himself in the fourteenth episode of the fourth season of the hit NBC sitcom 30

Rock. In the episode, he governed the sale of NBC Universal to a fictionalPhiladelphia-based cable company,

Kabletown, a parody of the actual acquisition of NBC Universal from General Electric by Comcast in November 2009.