Transcript - WINNING

Author: Jack and Suzy Welch
Plot: Jack's blueprint for winning
Note: It's a thick book, but a good read. But don't get the audio version, it's too complex and you'll find yourself frequently rewinding

Listen to "WINNING by Jack and Suzy Welch [14 Mins]" on Spreaker.

Full Transcript
Hey, welcome back!

Today I will be reviewing Winning by Jack and Suzie Welch. Caution: this is a 704 page book! It's big!

The audience for this book is anyone who wants to improve their career or be part of a winning team, and / or especially leader CEO types. If you’re just looking for career improvement essentials skip to the last few chapters. However, the insight into how your leaders think will prove useful.

I gave this book 5 stars. But I recommend you buy the hardcopy. This book is too full of information to listen to the audio version. Don’t even consider that! It’s the kind of book that must be studied. Read and re-read, underlined and earmarked. I got the audio version and while Jack Welch does a great job reading from his own book, the content is far too deep. You find yourself rewinding and replaying and taking notes instead of relaxing and taking all the information in. I can’t imagine anyone would get as much from the audio version as they would from the hardcopy, where you can simply underline instead of pausing and typing copious notes.

To his credit, it made me wonder if he was reading the book or if he was talking to me directly. I wondered if he was even speaking off the cuff. I doubt that was the case, which tells me his book is written in a very personable way.

However, as I said I felt overwhelmed with information and a little bored by the content making completing this book, feel like work.

Jack Welch is an American business executive, author, and chemical engineer. He was chairman and CEO of General Electric between 1981 and 2001. During his tenure, the company's value rose, are you ready? 4,000%! In 2006, his net worth was estimated at $720 million. And when he retired from GE he received a severance payment of $417 million, the largest severence in history.

And so when a guy like that writes a book called winning, he probably knows what he's talking about.

Jack wrote this book after retiring from GE just in case you’re curious.

He said he didn’t plan on writing one, but he kept hearing the same questions over and over and he felt like obviously the information is sought after.

His book starts with a well thought out introduction that summarized for the most part pretty well the entire book. However, to get the best value, you need the detail he provides after the intro. So don't just buy the book and read the introduction, you need the rest, too.

He conceded that winning is a broad topic. While there may not be exact solutions there are guidelines and frameworks that you can use in order to win.

He commented that after retiring and doing public speaking he hears a range of questions repeatedly over a broad set of topics that he summarized together under this book called WINNING. And he gave some example questions, and noted they range from: 

How to deal with the threat that China poses to do you think you’ll go to heaven when you die?

Business is a game that should be regulated by government and conducted fairly and honestly and therefore it is a game that must be won according to Jack.

He says winning is fun and if you’re not having fun, it's because you’re doing it wrong.

He contrasted winning with what it feels like to lose and how a dying company impacts stress, health and family life. Falling salaries diminishing self-respect it's not good. So He offered guidance on how and when to change your job.

I’m going to give you an example of the sort of clarity that Jack’s book brings to confusing and vague concepts. this is a skill he has: taking something that is ambiguous and merky and making it crystal clear is a skill that is made obvious by what he has written in his book. 

I'll start with the first example he gave for example the confusion about mission statements vs. values. He says the mission is where you are going and values is how you intend to get there. Now this is a boring topic in general, however he takes the boring and he actually makes it interesting.

The mission statement should be written by executives he says. And values should be written by employess. He says there can be no overcommitment to this. To enforce this you must reward and punish. Start with a draft and submit it for debate. And it should be debated. You want your people to agree to it. 

Some good questions to get it going in the right direction are:

  1. How are we going to win? 
  2. What are we going to do to win?
  3. What is winning?
    1. For GE it was becoming number 1 or number 2 in every business unit?

And then of course this missione then drives the behaviors which become your values. Once you know what your mission is, then you can say, "Okay, what values is it going to take in order to get us there?" And so an example of a value would be to treat customers the way that we want to be treated. Well, how is that? 

You say thank you in every interaction. And then your documenting of these behaviors results in the roll up of values into the mission statement and it ensures all of that is aligned to enable you to win. If your values add up to your mission and your mission is to win (the way that you define winning) then you will win.

When someone isn’t living up to the values that enable you to win, you let them go. That’s how you and they both know that it’s time to go.

Since they were part of the value creation process, or they agreed to it when they were hired, they will understand why they were let go. It will be clear to them that they should be let go. They contributed to the values, they understood and created or agreed to them, and failed to live up to their own standards. Of course they need to go. This makes it crystal clear what’s expected and it eliminates problems. All of these things are interconnected and very important.

A mission statement and values that are in conflict will kill a business he says. They must constantly remain in harmony. And that's important because when you hire, when acquire and divest, these values need to be re-evaluated and updated, or behaviors must be addressed to keep everything in harmony. Because when it's not in harmony, you don't win. The result you’re producing must be in alignment with your vision. He cited Enron and Arther Anderson as examples of failures in these areas. Obviously those are severe failures. And I like that he does that. We can assume that GE lived up to the standards that he outlined in the book, as an example of good behavior, considering that he was at the helm for twenty years. And each time he cites the risk of disobedience to the discipline, he gives examples of companies that fall into that category. Making it clear: okay, we know the result with Enron. And the Enron failure differs from the failure of AOL Time Warner for example. 

Up to this point I’ve described aspects of the introduction and chapter 1, my goal being to give you an example of how he dispenses with confusion in vague business principles. 

We’ll get into chapters 2 and 3 in a minute here, but this is something he does from the beginning of the book to the end. You’ll notice these concepts are interwovent. Meaning by the time I summarize chapter 2 and 3 you’ll see why the introduction and chapter 1 were crucial. 

Chapter 2 is about candor. He says the absence of candor kills a business and the presence of it makes all the difference.

Audit and oversight are necessary to ensure people are exhibiting the values they agreed to and candor is necessary to repair broken behavior.

And that makes sense, right? First the standard is made clear to everyone and then they need to know if they’re meeting the standard. They could be meeting, exceeding or failing to live up to the standard. And if no one tells them in plain English, then everyone loses.

Jack said that Aristotle had tremendous confusion over why people will say one thing and think another.

And while Jack Welch was told his candor would eventually get him fired, and he was told that repeatedly over the years, he believes it was what made him successful. He gave some examples of candor and acknowledged that it doesn’t always lead to strong relationships with everyone, but it does lead to high quality relationships with others who understand the value of candor. The importance of candor...

Chapter 3 covers Differentiation - he says this is the most controversial subject
that he covered in his book. People dislike doing it because it’s awkward and especially if they’re cowardly, it’s a problem for them. Telling one person they’re great and another one that they suck is somewhat undesirable.

He says he implemented this too soon. He should have first introduced candor and allowed that to exist until trust was established in the organization.

In my own words, I’ve discovered people are surprised I blurt out what I think and so I notice people tend to acclimate to me over time. It depends on when you meet me. Some people think I’m too nice when they first meet me, until they cross me and then I blurt out what I think about they did. And then they think I’m mean for a while, but if they’re around me long enough they discover I’m fair. And sometimes that feels good and other times that just plain hurts.

However, when we’re talking about who don’t normally use candor, it generally takes quite a bit of time for them to figure out the right balance. I’ve used candor for many years and I’m fair, and people will eventually figure that out, but when I first started experimenting with candor I made some major blunders. Not realizing there are many ways to communicate an honest message. And so I can only imagine what an entire organization of newborn candor babies would be like. Everyone trying to master this new skill together at once. In some respects that would make people more forgiving of mistakes, but it would also be hell on the nerves. And so I like Jack’s measurement. Rather than giving a time frame he looks for the result. Has trust been established in the organization? If so, time for this next new concept, the one he calls differentiation.

I'll give you an example from my own life of once when I was new using candor and I wasn't really very appreciative of the other person's perspective. What I said kind of came out harsh from her perspective. From my perspective, I was just being honest. 

I was once at the laundromat and while I was there there was this girl and I noticed she kind of kept looking over at me and I thought, "I think she might be interested." And then she kind of wandered over next to me and commented that her grandmother had told her that the best place to meet guys was in the laundromat.

Since I wasn't really interested in the girl I looked at her and I said, "you probably shouldn't take dating advice from your grandmother."

Now I didn't think that that was particularly harsh, but based on the facial reaction that this girl produced, it kind of looked like she wanted to open a washing machine jump in and put it on the spin cycle. Or maybe go flush herself down the toilet.

So bear in mind that candor is an art form and it will take a little bit of time to master. All right for differentiation, he says in order for that to work, you must have rewards and punishments. So those are pre-requisites. Rewards are bonuses, awards, that sort of thing. Punishments are disciplinary actions up to and including dismissal. He likens this to grades in school, they're necessary to reveal your need for improvement.

And then he described his 20/70/10 system: where the 20% are the top performers, 70% are the middle, and 10% are the bottom. And he says it’s crucial to let them go because they harm the companies’ performance and morale. And I agree, the bottom 10% can suck the life out of the top 90. I’ve seen it happen. It’s a marvel to watch. And so I completely agree. They need to be fired or they will multiply.

He noted that abuse is possible in any system, not just differentiation. So while some dislike it and note the drawbacks, that’s true of anything. Favoritism was the example he used. Where a manager picks favorites instead of performers and rewards everyone disproportionately. But the work done in chapter 1 and 2 should reveal these kinds of abuses. Because your division will underperform making the problem obvious to everyone. In that case the manager either must repent or face dismissal.

What I like about Jack’s book is that he is able to articulate how to implement clarity at every level in the organization. Eliminating confusion completely. And I would imagine it’s obvious how the three chapters I just described work together. The whole book is like that. The beginning of the book is a joy to read, the middle is a little tedious but necessary and then the end is just kind of okay.

The book is comprehensive; the paperback is again, 704 pages. It includes:

  1. Everything you would need to know to manage an existing company
  2. Or start a new one
  3. Or even spin off a new business 
  4. Handle a merger
  5. Even getting a job
  6. And moving up in the organization; 
  7. And an overview of what Six Sigma is (when you need it and when you don’t). 

He closes the book on miscellaneous questions including: 

  • How to deal with the China threat 
  • and his belief that he does, in fact have a real shot at getting into heaven.

Once again, whatever you do, steer clear of the audio book. Buy the hardcopy and then underline everything that it takes so that when you come back and review the book, like the reference manual that it is, it will be easier to find the high points.

Again, I gave the book five stars.

While Jack says the audience is for anyone looking to improve their own career, I personally think leaders and CEOs are the best audience. However, there is definitely value in reading books like this as an employee, because it gives you the view from the top down. And that truly will turn you into a better employee. So he is right, everyone should read it, but leaders should study it. And employees might want to skim.

That’s all folks!

Have a brilliant week! And ya’all come back now! Ya hear?

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