Jack Welch and the Mysterious Business of Business

Jack Welch

Since I haven’t had many deep thoughts lately, I want to share with you some essays about history that have caught my attention. In this case, the history is pretty recent—it’s about the late Jack Welch, CEO of General Electric from 1981 to 2001.

When I was an economics editor at Business Week in the 1980s,  Jack Welch was becoming a legend. My editor-in-chief admired him, talked with him a lot, and featured him as a speaker at magazine functions. In 1999, Fortune called him the “manager of the century.” He was bold, smart, and unafraid.

But did he bring General Electric down?

General Electric  was founded by Thomas Edison and J. P. Morgan in 1892. It developed a ubiquitous brand name and seemed to “own” the field of electric appliances.

By 1981, however, when Welch became CEO, it lacked vigor. It was a $12 billion company, but stodgy and bureaucratic. Welch attacked that bureaucracy, laid off workers,  and started acquiring companies. When Welch left in 2001  the  company was worth $600 billion and in terms of revenues was the fifth-largest company in the U.S.

But gradually  the company fell apart. Continue reading “Jack Welch and the Mysterious Business of Business”