Jack Welch, one of the most well-known CEOs in the U.S. and the chairman and CEO of General Electric between 1981 and 2001, passed away on Sunday night aged 84.
Welch will be mostly remembered as a firebrand CEO, a hard task-master who put a premium on high performance and profitability but also one who differed from traditional CEOs in his demeanour, penchant for informality, flexibility, and simplicity in work culture at GE.
Welch joined GE in 1960 as a junior chemical engineer in the company’s Pittsfield, Massachusetts factory for a yearly salary of $10,500. After almost quitting GE in 1961 because of his dissatisfaction with the work culture there, he climbed up the ladder quickly- becoming the vice president and head of GE’s plastics division in 1968 and then then the vice president of GE’s metallurgical and chemical divisions three years later.
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Jack was larger than life and the heart of GE for half a century. He reshaped the face of our company and the business world. He will be missed. We will continue to honor his legacy by doing exactly what Jack would want us to do: win. pic.twitter.com/3rxng5JOHkOpens a new window
— General Electric (@generalelectric) March 2, 2020Opens a new window
Welch wore several hats at GE in the Seventies. After becoming the head of strategic planning in 1973, he also donned the role of senior vice president and head of Consumer Products and Services Division in 1977 before becoming the company’s vice chairman in 1979. In 1981, Welch was appointed chairman and CEO- a position he would hold on to until his retirement in 2001.
After becoming GE’s CEO, Welch got down to work immediately. Over the next decade, he fired tens of thousands of workers, shut factories, sold off under-performing verticals, and fired 10% of managers each year based on their performance. At the same time, he completed 600 acquisitions, rewarded top-performing employees with stock options and bonuses, and heralded GE’s foray into financial services.
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Jack Welch, former Chairman and CEO of GE, a business legend, has died. There was no corporate leader like “neutron†Jack. He was my friend and supporter. We made wonderful deals together. He will never be forgotten. My warmest sympathies to his wonderful wife & family!
— Donald J. Trump (@realDonaldTrump) March 2, 2020Opens a new window
So profound was Welch’s influence and leadership that GE’s revenues jumped from $26.8 billion in 1980 to almost $130 billion in 2000 and the company achieved a market capitalization of over $450 billion by 2001. However, he had his share of infamy as well. Following his retirement, GE’s market cap almost halved over the next two decades and he was accused of cutting corners to achieve profitability and inflating price-earning ratios.
That being said, Welch’s legacy will be GE’s competitiveness and atronomical rise in the 1980s and the 1990s, something for which he has received much admiration since his retirement which did not prevent him from continuing to lead an active life. Welch passed away due to renal failure at the age of 84.
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