The key ideas

Winning

Jack Welch, Suzy Welch, 2005

How do you tell an employee the truth, whom should you hire, and why did someone else get the promotion? Jack Welch ran General Electric for twenty years, then spent years answering questions like these in halls around the world. This book collects his answers, from a company’s mission and honest assessments of people to five-slide strategy and career advice.

Who it is for

For managers who want to speak honestly with their teams and win, and for anyone thinking about a career without knowing how to grow further.

If a job does not excite you at least a little, do not settle for it.

Questions that keep people awake at night

Imagine a hall containing several hundred people: managers, small-business owners, students. A microphone passes along the rows, and the questions are almost always the same. How do you tell an employee the truth without hurting them? Whom should you hire? What if the boss is unbearable? How do you get promoted without losing your family?

Jack Welch heard these questions for years. For twenty years, from 1981 to 2001, he ran General Electric, one of the world’s largest companies. After retiring, he traveled to many countries and answered questions from more than two hundred and fifty thousand people. With his wife, journalist Suzy Welch, he gathered his answers in this book.

Welch’s main point is simple: winning in business is good, because a winning company gives people work, growth, and confidence in tomorrow. But winning rests on a few things everyone knows and few do daily rather than clever tricks: a clear purpose, honest conversation, honest assessments of people, and respect for every voice.

Ahead are Welch’s rules for managers, his five-slide strategy, his war on budgets, and advice for anyone seeking career growth. Let us begin with what Welch believes makes everything else possible.

A good mission answers one question

Almost every company has a mission, elegantly written and framed near the entrance. Welch jokes that many really answer the question of how to describe the business without offending anyone in management. People read “quality,” “customer,” and “integrity” without knowing what to do tomorrow morning.

For Welch, a good mission answers one question: how do we intend to win in this business? It names a choice: where the company will outperform others and what it will reject. Values describe the behavior leading to that goal. The mission says where to go; values say how.

Welch uses Arthur Andersen’s story to show what happens when a mission blurs. For almost a century, the firm’s craft was the audit, examining others’ financial statements, where caution and integrity matter most. Then consulting grew within it, a business-advisory division with a very different culture: bold, assertive, and oriented toward quick money. The two halves wanted different things, and in the 1990s, Welch says, the firm fought itself. In 2002, after the Enron scandal, Arthur Andersen collapsed.

Values mean nothing without consequences either. Welch divides managers into four types. Those delivering results and sharing values are promoted. Those doing neither are let go. Those loyal to the values but missing the target get another chance. The hardest case is the fourth: someone delivers numbers but does not share company values. Welch says precisely these people ruin companies, so they must be let go with an open explanation of why.

It resembles a soccer team whose best scorer ignores the coach. He scores goals, but the others quickly see that rules exist only on paper.

If you lead even a small team, try expressing its mission in one sentence answering “how will we win?” Name three ways of behaving essential to that goal, then ask honestly whether you actually reward them.

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About the author

Jack Welch (1935–2020) led General Electric from 1981 to 2001. Fortune named him Manager of the Century. Suzy Welch, his wife and coauthor, is a journalist and former editor-in-chief of Harvard Business Review.

All books by this author: Jack Welch, Suzy Welch

Terms from the book

  • Bureaucracy
  • consulting
  • Enron
  • General Electric: An American industrial corporation that made everything from light bulbs and household appliances to aircraft engines. Jack Welch led it from 1981 to 2001.
  • Arthur Andersen: An American firm once among the world’s largest in financial auditing. It ceased operating in 2002 after the Enron scandal.
  • Audit: An independent examination of a company’s financial statements to determine whether they accurately show income, expenses, and debt.
  • Differentiation: Welch’s word for a system that honestly separates people by performance and treats each group differently. The author’s framework rather than a universally accepted management standard.
  • Work-Out: General Electric’s program in which employees and managers examined obstacles to work, with the boss required to respond to suggestions immediately.
  • Budgeting: Drawing up a company’s annual financial plan: how much each department must earn and may spend.
  • Political capital: Influence and trust accumulated within an organization that someone can spend to support a person or accomplish something.

All terms

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