General Electric’s employees started to listen more attentively to CEO Jack Welch’s simple speeches on the company’s values following its unprecedented restructuring during the early 1980s, which included divestments in over 200 GE subsidiaries and massive layoffs of around 135,000 people. The resulting company was considerably less bureaucratic, underlying the CEO’s message of simplicity, candor, and transparent learning across boundaries. To underline this, Jack Welch personally started a series of “workouts” or “town meetings”—which were simply gatherings of key managers across functional and geographic boundaries—where difficult issues were discussed openly and candid learning was fostered around the CEO’s leadership. As a result, there were fewer and fewer places to hide in GE’s global managerial ranks throughout the 1980s. Individuals who survived their CEO’s grinding communications rituals were capable of passing on to others the simple message 14 SOCIAL NETWORKING AND TRANSMITTING COMPANY VALUES 111175-100 GI Business.indd 32 1/5/09 10:38:11 100 GREAT BUSINESS IDEAS • 33 of simplicity, candor, and transparent learning across boundaries. Most of Welch’s social networking took place at GE’s corporate university at Crotonville, where he reputedly spent over 50 percent of his time constantly coaching, and learning from others.
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• Reduce bureaucracy to increase the transparency and openness of your organization.
• Identify key employees across the business, and organize regular meetings to share ideas, report problems, and devise strategies. Use these meetings to assess workers: who is best at innovation and identifying problems, and who is weakest?
• Create a robust social network within your organization that can be used to transmit information and implement ideas promptly. This may involve bringing representatives from a wide range of “departments” to meetings. For example, rather than holding separate meetings for IT employees and marketing employees, allow them to discuss ideas together. This will give them a clearer idea of the challenges faced by the company as a whole.
• Hold regular meetings of global managers, to ensure they are unified behind the initiative and understand how it should be implemented. Also, encourage global managers to meet with members of their business unit to inform them of the company initiative.
• Provide incentives to managers to win their team members over—for example, by giving them performance-based rewards for their business unit’s success in implementing specific initiatives.