LASZLO BOCK: OK.
Terrific.
Well, thanks, everybody, for showing up live, showing up
on the stream for this Authors at Google talk.
And I could not be more excited to be
introducing our guests today.
So I'll read a little bit to make sure I
don't miss the good stuff.
Although, there's so much, we could spend a whole hour
on this.
JACK WELCH: We don't need to do that.
LASZLO BOCK: Just a little.
Just a little.
Some people may not have heard of you two.
JACK WELCH: OK.
LASZLO BOCK: So just in case.
We're thrilled to host Jack and Suzy Welch today.
Jack was chairman and CEO of General Electric
during a revolutionary time in its history,
a time when it went from a great company
to the greatest company.
And the management practices that Jack instilled
and the team he built have been lauded ever since.
And it's a once in a generation kind of company, an institution
that he built and created.
Suzy, an author and journalist, former editor-in-chief
of "The Harvard Business Review,"
a keen judge of people and talent, and a fantastic writer.
They've been partners and collaborators
for over a decade.
They're both involved in the Jack Welch Management
Institute, which is a leadership development
program and an online MBA program as well.
And they're here to speak to us today
about their book, "The Real Life MBA: Your no
BS guide to winning the game, building a team,
and growing your career."
And everything that you talk about in here
resonates incredibly deeply.
It's a personal thrill, actually,
to be here because of my own history, my few minutes
I spent at GE, unfortunately after your tenure.
And it's a delight to meet you in person as well, Suzy.
So as you can see, I had a lot of comments and questions.
So what we do is I'd kick things off,
and then we'll open it up to questions.
We also have an online page where people online are
submitting questions, and somebody
will come up and tee those up.
JACK WELCH: Great.
LASZLO BOCK: And I have the advantage in that
I've read this cover to cover.
I don't know if everybody in the room has yet had a chance to.
But just for a context setting question,
it's been about 20 years since you've been at GE,
and you two have been partners in crime for some time.
What have you been up to?
What have you been doing?
JACK WELCH: Traveling the world, selling a message of business.
Business is good.
Winning is good.
When companies win, good things happen.
You get a cheerful crowd like this in the room
because Google wins.
You wouldn't have that if it was in the tank.
So basically we're out selling how to make it win
and why winning is good.
And we're also running 24 private equity companies.
And we started a school, which now has 900 MBAs.
We've spoken to over a million and a quarter people.
Excuse my voice.
I've been doing this for three weeks.
And I'm a burned out guy now, but I love doing it.
We both love doing it, and we learn every day
from different people.
We've been in the Midwest.
We've been across the East Coast.
And then we've been in this beautiful bubble
called California.
LASZLO BOCK: Now, you were saying
when we were talking before that what you see here
in Silicon Valley-- and you've been to some other companies.
You've talked to folks.
You were both telling me it's a little different from
once you get 50 miles from here, once you get in the Midwest,
once you get to the South.
What are you seeing everywhere?
How's it different?
JACK WELCH: Well, it's a tougher grind.
It's a tougher grind.
Since the 2008 recession, things have gotten a lot tougher.
And people out there aren't back to employment levels
they were at before.
They're not sure that the company that they signed up for
is still the same company.
They've lost some benefits.
Some other things have gone away.
Companies have shrunk down.
The word across most of the country is do more with less.
That's the slogan.
No matter where you go, do more with less.
It's not the slogan here.
SUZY WELCH: This morning when we were
getting ready to come here-- we've been here for a few days,
and obviously we in our lives had dealings
with Silicon Valley companies.
And I just was ruminating.
And I said to Jack, it is really like a different planet here.
We've just been through the Midwest,
Kansas City, Minneapolis.
And just the questions are different,
and the expressions are different.
And it's like this very-- and I'm
saying this in the most positive way, because it's
a beautiful thing.
But it's a very shiny, happy place
compared to many other pockets in the United States.
Where the sense of possibility here is amazing,
but we've been in rooms filled with people
who have a very different sense of what the world feels
like right now.
And wouldn't it be an amazing, marvelous thing
if the whole country was experiencing
what you're experiencing?
It's great.
JACK WELCH: The best way to think about this is Google
runs a survey every quarter.
SUZY WELCH: Not Google.
JACK WELCH: Not Google.
I mean Gallop runs a-- I'm at Google,
so I got Google on the brain.
LASZLO BOCK: We do surveys every quarter, too.
JACK WELCH: Gallop does a survey every quarter
on employee engagement in America.
And in the recession, it got down to the point
where 70%, in 2008, of employees didn't like going to work,
were not engaged in their job, didn't like what was going on.
Today, six years later, seven years later,
it's 65% in the last quarter that
are disengaged with their work.
They don't like work.
Work isn't part of their life.
They don't see it as part of their life.
It's a way to get a check.
And that's a terrible thing.
And so we're out trying to change that.
We're out trying to get people to have this feeling
of excitement, about growth.
Growth is an elixir.
And what you can do to grow, how you can grow, how you get
aligned-- all these things.
We think-- and we've seen it in private equity.
I've been involved with 74 companies over the last 15
years, 24 are active now.
And we've changed lives at these companies,
because these companies were orphans in big companies.
They were broken companies.
You don't buy a private equity company because it's healthy.
You buy a sick company and try and fix it.
And you spend several years fixing it,
and then giving it freedom.
But that life is not going on in many companies.
LASZLO BOCK: But you started out by saying
you're about preaching winning.
And you famously are known for-- at GE,
you said you have to be number one or number two
in an industry, or get out of it.
You talk about the importance of growth, of winning.
What you write about here and what you're hinting at now
is people just not enjoying their work,
about there not being meaning.
And in the book, you talk about the importance
of having a mission.
Is a mission the same as winning?
Is winning sufficient?
Or is there something bigger, better?
JACK WELCH: Winning's the product
of a good mission, and a good set of behaviors,
and the consequences that come from it.
So winning is the result. It's not a starting point.
Like, for example, we say the chief characteristic
of a leader is to be a chief meaning officer.
Give the work purpose.
People come to work because they want a purpose.
They want to have a reason for being.
They want to be a part of it.
And your job as a leader is to let people
know why they're there, where they're
going, why they're going there.
And then when everybody leaves out
in most places, what's in it for them to go there?
And what are the consequences, pro and con, of doing it right?
LASZLO BOCK: But how do you find that meaning
in the kind of places you've been to over the last week?
SUZY WELCH: I'm just think about these two anecdotes.
I hear your question, and this is
a little bit of a roundabout way of saying this.
For many years after Jack retired,
we ran a seminar called "Two Days with Jack Welch."
Where 100 CEOs would come in from around the world,
and they would work with Jack for two days.
And when we first did the planning for this Jack said,
I'm just going to spend the first hour
on just talking about mission.
Because all these CEOs surely know
what the mission is of their company,
and then we'll move right on to X, Y, and Z.
So the first day starts out, and Jack looks at this crowd--
100 CEOs who had self-selected to come to a group
to work on management.
So you'd think they'd be very self-actualized
and enlightened.
And I was sitting at one table with a bunch of CEOs,
so I could hear what they were saying.
And Jack said, OK, so just jot down your mission.
And there was this weird, uncomfortable silence.
And I was actually sitting at a table
with two brothers who were co-CEOs of a family company.
And one brother said to the other, what's our mission?
And you're here.
We've been here.
We've been at Google an hour and a half or something.
I've heard the mission mentioned repeatedly.
We got a demo.
We met people in the hallway.
And the mission is just flowing all out of you,
and I actually think you also--
LASZLO BOCK: Are you getting sick of it by now?
SUZY WELCH: No, I actually dig it a lot.
I was saying to Jack, too bad none of our kids are engineers.
They know poetry and whatever.
Because this is the kind of place
a mother would want her kid to work.
And so because of that mission and that sense of incredible--
I think you all know what you're doing here
and how your work is connected to the mission.
And secondly, in our 10, 12 years
traveling around the world, we've
made the point over and over again
that it's imperative for leaders, no matter
if you're a leader of 300 people or three people,
to make sure that your people know where they stand.
How they're doing, what they're doing well,
what they could be doing better, what the trajectory
of their career looks like.
And when we travel around we say to crowds, how many of you
know where you stand?
And it is a very, very good day when 15% of the crowd
raises their hands.
We were in Chicago the other day.
600 people we asked this question.
Four people raised their hands, knew where they stood.
It was a big business group.
And so they didn't know the meaning of their work.
Clearly, if you're not having a conversation about where
you stand and what you could be doing better,
you don't even know what the meaning of your work is.
This is why that number is 65% of people disengaged.
So you should all pinch yourselves
because I bet you know where you stand.
And we did this yesterday at a Silicon Valley company,
and 85% of the hands went up.
JACK WELCH: No, it was about 60%.
SUZY WELCH: But it was still better
than any place we've been.
JACK WELCH: Any place we've been Do you want to try it here?
LASZLO BOCK: Oh no, no, no.
I'm terrified.
Do not.
We can try it.
SUZY WELCH: Let's try it.
LASZLO BOCK: Let's do it.
JACK WELCH: How many people here know what their boss thinks
of them, they know exactly where they stand,
and what their career trajectory is?
LASZLO BOCK: Come on.
Thank god.
SUZY WELCH: You win.
JACK WELCH: Well, I'd say 60%.
SUZY WELCH: No, no.
I think a little bit higher, Jack.
Let's do it again.
LASZLO BOCK: Looks like 110% to me.
It was not 100%.
There was like four people in there.
Kevin, I'm looking at you.
SUZY WELCH: Taking names.
LASZLO BOCK: No, but it's actually
something we're not always great at,
because we love-- we focus on hiring great people.
And then we try to give them a lot of freedom.
And we try to get managers great.
But it's a hard thing even for us to get managers
to have those tough messages.
And later in the book, you talk about this.
You have a section-- I'm going to skip ahead-- where you talk
about a woman named Lauren.
Lauren is a financial analyst.
She's 34.
She'd heard whispers that she might be made a partner as part
of a management transition.
And you go on.
But suddenly the whispers stopped,
and Lauren was informed by a colleague
that her boss was the reason.
And you continue on.
And eventually Lauren was asked--
we asked Lauren-- you two asked Lauren
if her boss felt the same way about her value to the firm
as she felt about her value to the firm.
And she said, he just doesn't want
me to be a partner because I'm a woman.
He got pissed off when I went to part time after my baby.
And you write, was that the case?
It's possible.
But here's the story.
Lauren was guessing.
When we pressed her, she admitted
she had no clue how her boss really
felt about her performance long before her baby
or after, because he'd never told her.
And so that makes me wonder.
And it's great that we actually weren't quite at 100%.
Whose job is it to make sure the employee knows
where they stand?
Is it the boss's job?
Is it the employee's job?
Is it shared 50-50?
JACK WELCH: No, I think it's without question
the boss's job, but the employee has a responsibility,
if they've got a bad boss, to press on about it.
And we talk about career purgatories,
about working for a boss that doesn't
have your interests at heart.
That happens in every good company.
It'll happen.
You'll get a bad boss.
We talk about bosses that don't have the generosity gene.
That aren't generous about their praise,
generous about their rewards, steal ideas and take them up
as their own-- all those things.
So you've got to put timetables on those situations.
But it really is the boss's job.
We have a daughter.
You might tell this story, this one story.
SUZY WELCH: So one of our daughters works in LA.
And she's in the entertainment business
where she was very happy to get a job.
So she's working away, and you can
imagine having your career managed from afar by us, right?
So she actually is working in LA,
and she doesn't know how she's doing.
She's working very, very hard, but her sense
of her performance rises and falls on her boss's mood, OK?
So he's in a good mood, she's doing great.
JACK WELCH: And we get a phone call.
If the boss grunts, we get a phone call.
SUZY WELCH: The phone calls and the texts
are related to his mood.
So then one day, she gets a raise in the mail,
in her paycheck.
And she calls us, and she's ecstatic, second
only to us being ecstatic, that she got a raise.
And she said, I got a raise.
I got a raise.
We said, well, why did you get the raise?
And she doesn't have any idea why.
So because she's related to us, we said to her,
you have to go in and find out why you got this raise.
No, no.
I don't want to piss him off.
We said, you've got to find out why you got the raise.
So finally under extreme pressure,
she went in, into his office.
We can only imagine it was like, hi, sorry to bother you.
And so she said, I got a raise.
I'm really happy.
Can you tell me why?
And he looked at her, and said to her, merit.
Period.
That's it.
JACK WELCH: And what do you do with that?
SUZY WELCH: And she ran out the door.
She was so happy to get an answer and call us
and say, guess what?
I got a raise as a merit!
And she still doesn't know what it was.
Now, since then, she's been promoted.
So clearly they're happy with her performance.
But right now all she knows about what she does well
is "merit."
LASZLO BOCK: So what's your advice
then to somebody who's got a bad boss, who's not telling you
where you stand.
Just that you're fine, you're fine.
Your bonus is kind of OK.
It's great.
Maybe it goes up a little each year, whatever.
Do you confront the boss?
Do you push for an answer?
What's your advice?
JACK WELCH: No, I think the way you go is,
I'd like to talk to you about how you feel about my work.
How do you feel?
What do you think I'm doing well?
And how do you think I can improve?
How can I really improve?
Because I want to do a better job here.
And you don't ever confront them head on.
You go with what can I do better?
LASZLO BOCK: Wait.
Why don't you confront them head on?
Why don't you just say, what's going on with me?
JACK WELCH: Well, you can say, what's going on?
But you've got to ask them, what can I do better?
Don't go in and start challenging them.
It doesn't make sense.
It's suicide.
LASZLO BOCK: Yeah.
JACK WELCH: But come at it the other way.
How can I do better?
And what do you think I have to do to move on?
What do you think would be the criteria that
would get me the next level?
LASZLO BOCK: Yeah.
Well, the two of you, you talk about later in the book
when you're into the personal advice.
You have a section called "Why Careers Stall,"
which is related to this.
Because often your career stalls, probably you also often
aren't getting feedback.
And you're trying to figure it out.
And you talk about careers stalling for a few reasons.
You've got a blocker above you.
You can't grow.
You talk about how to resolve that.
You talk about wrongheaded notions
about the importance of multifunctional expertise.
You talk about boss haters, and you talk about purgatory.
It's like Dante's "Inferno" of career management here.
It's awful.
So can you talk a little bit about-- if you feel stuck,
what is a blocker?
What does that look like-- ahead of you, above you, around you?
And how we can step through each of these.
JACK WELCH: A blocker is somebody
who's enjoying your great work, and is very happy to keep you
in the draw to keep getting all that good work,
so that they look very good.
That could be one case of a blocker.
Another case of blocker is-- and these Midwestern companies
we were talking about is-- there's no growth.
The boss is going nowhere.
That doesn't happen here.
There's plenty of growth creating opportunities
all the time.
But in many companies, most of the world right now
with a GDP of 0.8% growth doesn't
have all these jobs opening up.
So you're stuck there in a no-growth situation
with a good boss maybe.
But what you have to do in all these situations
is control your own destiny.
You've got to put a timeframe on it.
I'll stick it out here for two years, or one year,
whatever you decide.
Pick a time frame and I'll overdeliver.
I'll give them more than they have ever seen before.
And if nothing happens, I've got to take my wares and move on.
LASZLO BOCK: Why do you think-- when you say it,
that's fantastic advice.
Most people don't do that.
Why not?
JACK WELCH: Insecurity, lack of self-confidence,
comfortable where they are.
Or maybe family situations-- kids, can't move,
they're in high school, college, whatever.
SUZY WELCH: Momentum, inertia, humanity,
and the fear of the unknown.
And I think also sometimes people
don't do anything because they have
this little nagging voice inside saying maybe the problem is me.
And it's just much easier not to look at that piece of it,
and so they'd rather just bump along.
JACK WELCH: I used to go to Crotonville,
which is our education place.
And I would teach every class.
And I would spend three hours in the class Q&A.
And then I'd spent three hours at the bar,
and I'd learn more at the bar than I
did in the teaching program.
But basically what I would always leave them
with-- always-- love being here, love being at GE,
but be ready to leave.
So that put the pressure on the leadership.
If the leadership wasn't taking care of you,
and we started seeing good people leaving
in a certain area-- and it didn't happen very often
in those days.
It didn't happen very often.
But if it did, we knew we had a bad boss.
Just like if you have a plant, a factory--
we had a lot of factories.
And when a union showed up, and a union took a vote,
and they got a positive vote-- now,
we never formed a union in the 21 years I was there.
But whenever it came up for a vote,
we knew we had a jackass plant manager.
Because otherwise it wouldn't get there.
If you had the right atmosphere, the right feelings
in the place, a transparency-- we want transparency.
Transparency is the biggest virtue
you can have in a company.
And if you have a transparent spot,
you won't have unions forming.
People will think they have voice anyway.
They will have voice.
They only form a union to get voice,
because nobody's listening otherwise.
LASZLO BOCK: So when you have these situations--
and I want to circle back to the career side,
but you've both seen a ton of companies.
And every time in the book you talk about a leadership
transition, you talk about firing people.
And this isn't the stack rank 70/20/10 stuff.
You talk about Eric Fyrwald at Nalco.
And he goes in, and he moved on.
You say many top leaders had to be
asked to move on-- more than half of the top 100
So new CEO, 50% or more of the people gone.
And then you say a personnel move speaks louder
than 100 speeches.
And there's a few other parts of the book where
you talk about the importance of when
you come in as a leader firing some of the people under you.
Is that just good hygiene?
JACK WELCH: We're talking there about private equity.
LASZLO BOCK: OK.
JACK WELCH: So in private equity,
the reason why you buy a company is
it's an orphan, usually, in a company.
It's a division that isn't liked.
I'm not sure at Google there are some, but I'll bet there are.
A division that's the turkey over here.
It gets less attention from the top people.
It doesn't get loved.
It doesn't get enough resources compared to others.
There are those in most companies.
So you buy these companies because the company
wants to trim down, particularly with activists out there now.
Companies are selling off divisions,
and you grab a division.
Well, those people haven't been looked at for 10 years.
They've been sitting over there, not growing,
not performing, but not being told anything.
So you bring them in, and you've got to get a fresh eye,
look at the situation.
So we're talking mainly about companies
you're acquiring that have been dead on their feet for years.
SUZY WELCH: And I think a lot of times,
and especially in those stories, when
you want your company to be productive, and fast,
and creative, and innovative, and all those things,
people pretty much need to share the values.
And the values have to be things like teamwork,
and like maybe you have here, fast failure.
You have values that you want people to demonstrate.
And so when there are these leadership transitions,
if a leader comes in and says, you know what?
I am installing these values, the values of urgency,
and speed, and boundarylessness.
And you have people who-- there's
a great story in the book, I think,
when Dave Calhoun came into Nielsen.
And he knew that this was a silo company where
nobody spoke to each other.
And he knew that if it was going to survive and be
the company he wanted it to be, he
needed people who wanted to share ideas.
And he tried and tried to get that value across.
But when he found managers that just would not share ideas,
he had to ask them to move on.
So it's a lot about values.
You guys talk about values a lot,
so this should sound pretty familiar, right?
LASZLO BOCK: Imagine a company that's going great,
and you have a leadership change at whatever level, right?
Doesn't have to be CEO.
Could be division, what have you.
What are the odds that they're not
going to have to fire anybody from the direct reports?
JACK WELCH: We bought two medical companies
in high growth industries that were underfunded,
and we didn't touch a person.
And we've had 6x returns with just pouring money
at them, giving them the resources to grow.
They were flourishing.
Now, you rarely find those birds, OK?
Whenever you find a blue bird like that,
you go home and rub, rub your hands.
Life is easy.
It's all good.
And you take it public, and in two years and make 6x.
LASZLO BOCK: And you look like a genius.
JACK WELCH: An absolute genius.
All you did was give good people money.
LASZLO BOCK: That's a good strategy.
SUZY WELCH: Yeah.
JACK WELCH: The thing you have in your book, which
I like so much, and I've never seen it written out.
I write it all the time, but I've never
seen, other than you and I, this idea
of paying great people lots.
Paying great people.
We have a story in here of getting whacked
and recovering from a whack.
And what we talk about there is the 2008 Recession.
We were so brilliant.
We bought this company called Home Depot Supply.
And Home Depot Supply sold lots of goods
to the construction industry.
In 2007, it was booming.
Housing booming, everything booming.
And it was doing $12 billion in revenues.
In 2008, four quarters later, it was doing $7 billion.
It collapsed on itself.
And so our smart decision to buy it
couldn't have been worst timing.
Could not have been worse timing.
We get it, and this guy Joe D'Angelo brings his team.
He'd been hiring them for sometime,
a bunch of people he worked with before.
His first act was not let's cut 10% across the board.
We've got to save money.
No, his first thing was pay the aces tons of equity,
tons of equity.
I've got to keep the stars.
If I'm going to get out of this whack, where he's probably
going bankrupt, the first thing I've got to do
is make the stars know we're all swimming in the same tank
together.
And I'm giving you lots of money.
Well, to make that a long story short,
he did lots of other things to get out of that whack.
And we talk about getting out of a whack.
We'll all have whacks business-wise, personal,
you'll get hit, and how you get out of it.
Well, this is a story of this guy
taking the absolute non-traditional way
of doing it.
He went at give me the aces in the game,
and I'll give them all the money.
Well, they just went public about six months ago.
The top team-- now, this isn't big money
by Silicon Valley standards, but the top guys
got over $100 million.
LASZLO BOCK: That's big money even here.
JACK WELCH: Even here?
LASZLO BOCK: Let me correct you, yeah.
That counts.
JACK WELCH: No, and the mid-level guys all
got $20 to $40 million.
LASZLO BOCK: That's also big money.
JACK WELCH: But it was fabulous.
But they hung in there through six years
of fighting that mess.
But he did the opposite of what you traditionally see.
Nothing's worse than anything across the board--
across the board raises, across the board cuts--
they're all sinful things to do in business.
They're just cowards.
LASZLO BOCK: Well, we were talking about this a little
beforehand.
So you find your aces.
You give them the big equity.
The middle people, they kind of get it.
They're worker bees.
The people at the bottom--
JACK WELCH: But they get some equity.
LASZLO BOCK: OK, they get equity, too.
What do you do about the layer just
below the ones who get the giant awards?
JACK WELCH: That's the toughest layer to manage.
I We started out with a system, Bill Conaty and I,
of going 10, 15, 50, 15, 10.
LASZLO BOCK: And Bill Conaty was your head of--
JACK WELCH: Head of HR.
And we were partners in this.
We [? lived ?] people the whole time.
That was our whole job in GE.
We didn't spend a lot of time on other stuff.
And the trouble always came in trying
to make these careful slices of 10
between the top 10 and the next 15.
We're all humans.
We're making these cuts, and we're not
really that good at making them, so we piss off the next group.
So we cut that down to top 20, middle 70, bottom 10
to try and get a distribution that looked like this.
And the biggest problem you have is
taking good people in the middle and telling them
they're in the middle.
That by far is the hardest job.
And so I always erred on pushing them to the top of the middle
and getting them as close as you could to the top.
LASZLO BOCK: And they're happy with that?
They live happily ever after, or they were just
slightly less unhappy?
JACK WELCH: You've got to understand that these ratings
are a period in time.
They're not a lifetime sentence.
I'm in the top 5%.
Am I there forever?
No, if you stink, you'd get out of there.
And if you're in the next group, you guys
have 5, 20, or whatever.
You've got that five tier thing.
And people that can move by performance-- the thing we've
got to get clear though on performance-- even you
in your letter had a little misunderstanding
of what our thing was.
When you're looking at valuing where people are,
there are two axes.
On one axis is behaviors, the values of the company-- speed,
boundaryless behavior, et cetera.
Now, you do that, a separate evaluation of these things.
And you put a half circle or a full circle,
because you can't put a numerical number to those.
You fill in a circle.
If they're fully qualified in that area,
they get a full circle, half circle, quarter circle,
whatever.
And then you come up with a judgment.
This is how this employee adheres to the behaviors
we need to win.
Because it's where we're going.
That's the mission.
How we're going to get there, or the behaviors, and then
the consequences.
And then on the bottom axis you've
got numerical performance.
Whether it's sales quotas, R&D, new products--
whatever you pick as the financial measurements.
Then you draw four quadrants of people.
And it's low to high on each axis, OK?
Low to high-- I wish we had a little whiteboard here--
but low to high.
In the top right, you've got high values, high behaviors,
and high performance.
That's easy, onward and upward.
On the bottom left quadrant, you've
got low behaviors and low numbers.
That's easy, too.
Give them some time to either fix it, or they move on.
Then the third type over here on the upper left.
You've got low performance but high behaviors-- very good.
They're on your team.
They believe in everything you believe in.
You give them a second, third, fourth chance.
Because when you get somebody who
buys into the whole system, the mission, if you will,
the mission of Google, the mission of company X, Y, or Z.
You want that person.
But it's the fourth quadrant out to the right
that kills companies.
And I'm sure you've seen them here,
and you've see them everywhere.
The high performer who's a horse's ass.
And every time you tolerate that person--
and you talk about your values and behaviors.
And you've got some jerk who's kissing up and kicking down
while getting good numbers, you keep tolerating him.
And you give speeches on values, and mission, and beauty,
and peace, and everything else.
But you've got this person.
Every promotion of that person, every time
that person gets promoted, you ruin 50 speeches, 500 speeches.
Stop flapping your lips.
Don't talk about it.
So that person with high performing numbers
and lousy values is a killer of culture.
It's a killer of culture.
LASZLO BOCK: You talk about, I think,
this is a category of that.
You talk about boss haters.
Like when you talk about why careers get stalled,
to come back to that, some of it is you've got a blocker.
The other category was you've spread too wide,
which if we have time, we'll come back to.
But talking about low values, you talk about boss haters,
and how they don't know they're boss haters,
or they don't admit it.
But they're toxic, they're poisonous.
JACK WELCH: I'm going to come back
to that, because I want to stay in this other thing a minute
more.
LASZLO BOCK: Please.
JACK WELCH: Because you talked about,
it in your book, Microsoft, and you talked about Yahoo.
And you talked about rank and yank, that terrible word.
It was destroying those companies.
You talked to, you interviewed people, et cetera.
That facts are you couldn't be in the top performing group
if you didn't have teamwork.
Because you're in the wrong place.
They're looking at numbers.
Enron was all numbers, OK?
That's a misapplication of a theory of the case.
You're an important guy to carry this message long term.
That's why I'm pitching you.
No, it's very real.
You can't be a bad team player or a bad behaving person
and be in the top 10.
LASZLO BOCK: So let's dig into that.
So I agree, but let's explore for the folks who
are watching and listening.
So somebody who has great numbers, great salespeople,
brilliant engineer, total jerk, horse's ass.
You can see that.
What about the people where they're not at both extremes?
Great numbers, but they're a jerk sometimes.
They kick down sometimes.
They're kind of political.
Where do you draw the line?
Where would you call?
How much of that kind of behavior is acceptable?
Is any of it, or is none of it?
JACK WELCH: You can tell-- do people
want to hang out with them?
Do they have a place where people want to work?
Are they attracting people?
Or are people dodging them?
LASZLO BOCK: Well, that's one thing we've seen here.
Because we do surveys.
We love our data.
We do surveys about what do you think of your manager
every six months?
And one of things that happens is
we see people who are kind of brutal, really
rough, tough managers.
And what ends up happening is the teams end up
giving them positive scores.
Because they say, well, you know what?
I don't like working for this person,
but I know where I stand.
Or you know what?
I've learned more than I've ever learned.
Yeah, I get beat up once in awhile,
but I'm learning so much because this person's direct
and in my face.
And what's interesting is when those people move jobs,
the leaders move jobs, no one follows them.
And the team kind of goes-- [SIGH OF RELIEF]
But every measurement we have along the way,
you look at it objectively.
And people go like, oh yeah.
You know, it's fine.
I can deal with it.
Is this like having a bad boyfriend or girlfriend?
You just can't break up?
What's the secret?
JACK WELCH: No, you're going to have some--
LASZLO BOCK: And how do you find those people?
JACK WELCH: Look, you're going to look
till the last day you breathe, and you're not
going to get them all.
You can get faked out on this all the time.
Nobody has a perfect system.
The question is what's a better system?
It's always going to be that.
Because you can always argue against the perfect,
but no system is perfect.
But you've got to be able to evaluate people
on two axes, not one.
And now you may not get it right.
You may not be perfect, but you'll
be better than any other system out there.
LASZLO BOCK: I think you're right about the second axis.
I think we need that.
We absolutely do.
I have one question I want to say for the end,
but I want to open it up for questions
either that are submitted online,
or if anyone in the room has questions.
Actually, I have a whole bunch of questions, but if anyone
wants to start migrating.
Do you want to just run to the mic,
so we can get a recording of that?
AUDIENCE: Hi.
Thanks again for coming to Google.
One of the challenges that any large company has
is remote office workers in developing their talent.
What are some the best strategies you've seen?
I know you developed talent in your remote offices
when you were at GE.
What are some of the best strategies
you've seen for owning your own career as a remote office
worker?
JACK WELCH: Well, I'll try a couple, and you try some.
We have an online school, all remote.
And the biggest challenge is how do you
socialize that office to believe they belong to the mothership?
It's a huge deal.
You've got to make all kinds of efforts.
What we do is we have pivot points on the computer screen.
We know how many contacts the dean
has with every faculty member per week.
We know how many contacts every dean has,
every faculty member has with every student.
An online school is the toughest thing in the world.
People are working all day, go home and do the work at night.
They got a sick kid.
The worst thing can happen and they'll
have to stay up all night and do a paper,
turn it in, get back, nice job.
Killer.
So they've got to have that strength.
So we monitor totally the socialization aspects
of faculty with the student, the dean with the faculty.
We've got to bring them in.
And we talk about subcontractors-- same thing.
Subcontractor has seven clients.
How do I make the subcontractor like me
more so I get his heart and soul?
Well, here, you feed him.
You do all kinds of things, but you
want to get that subcontractor with more allegiance to you
than to the other six clients he has.
So you're always working on socialization.
You're always bringing him into the core as much as you can.
You're measuring how many contacts you have.
You're doing all these things to be sure that nobody
feels they're out on an island.
SUZY WELCH: I think the main thing
is that if you don't actively manage people who are working
remotely or virtually, if you don't actively manage it
and you let it manage itself, it falls apart.
And so managers often can feel-- I felt that way myself when
I was the editor of a magazine.
I had a lot of people not working in the office
because editing can be done anywhere.
And so a lot of people were in life stages
where they wanted and needed to work at home.
I worked with a lot of moms.
And you want to accommodate them,
because they were so talented.
And you're so busy with what you're doing day to day
that you just let it go.
And then you realize six months have gone by
and you haven't seen this person,
and you haven't really talked to them.
Every interaction you've had with them has been electronic.
It was easy, and it was working pretty well.
And then you get that person in, and you have a conversation.
And you think how much better it could've been.
So I think you just have to have it on your to-do list
to actively manage remote relationships.
And if you just let them go, which
is the natural human thing to do,
you just are not getting everything you can out of it,
and teamwork suffers.
JACK WELCH: The one thing that Google
could bring to the world, if you will,
is the ability to socialize online education.
No matter how hard we try, whether it be Blackboard,
whether it be this system or the other system,
we still are missing the socialization link
in our MBA program.
That's the weak link in the system.
How do we get our students more engaged in our game?
SUZY WELCH: And new technology comes out all the time.
Believe me, we've seen it.
JACK WELCH: It's not enough.
SUZY WELCH: There's nothing there yet.
JACK WELCH: We need breakthroughs.
SUZY WELCH: Please do it!
JACK WELCH: Please do it!
And it would apply to these offices.
LASZLO BOCK: Are you Google for Education customers?
Because we can introduce you to someone.
JACK WELCH: We looked at Noodle and stuff like that.
We've looked at it.
It isn't good enough.
SUZY WELCH: Oh, oh.
JACK WELCH: It isn't!
No, it's a nice product, but it isn't good enough.
SUZY WELCH: Next frontier.
LASZLO BOCK: OK.
Next question?
AUDIENCE: Thank you.
So I had a question on your career management.
So there are two approaches, right?
One is you stay within a company,
and you grow, stay 20, 25 years within GE, or a company
like that.
And in the Silicon Valley, it's more like every few years
you get a promotion, as in joining another company,
and move around every few years.
So how would you contrast the two approaches
to managing your career?
JACK WELCH: I don't think you manage your career.
I think you manage your job.
And what you do is you overdeliver all the time,
so you become a commodity with gold stars
everywhere so everybody wants you.
Anybody who's managing their career,
picking, I'll go here next, and I'll go here next.
And if I get that job, then I'll get that job.
Killer performer.
Keep your eye on your job.
Do better than anybody's ever done on that job,
and good things will happen to you
is my view of all those things, whether you
stay in that company or go to another company.
LASZLO BOCK: That's actually in your career chapter.
That's your first main point.
You say don't deliver, overdeliver.
JACK WELCH: Yeah.
LASZLO BOCK: And again, that's something most people
actually-- we do our best.
But most of us don't think about it
as I'm going to kick butt every single day.
I'm going to exceed everyone's expectations.
SUZY WELCH: I think it's hard to talk about that in this room.
Because I'm going to presume that most of you
have been overdelivering since you were in kindergarten.
LASZLO BOCK: Most of them.
Most of them.
SUZY WELCH: OK, but overdelivering
is an interesting concept.
For some people, it's very natural, OK?
But for others, it's not.
By overdelivering it means doing-- in school,
you're taught to deliver.
Even when you're at a fine school, you get the assignment.
You hand in the assignment.
You do the assignment very well.
And you're going to get a great grade.
But when you get into the real world, it's a different thing.
It's about making the assignment much bigger.
You're asked to do X. And you actually
give serious thought to what more, what
would be the bigger question.
And so you deliver on X and the bigger question.
Jack tells a great story about when he was
trying to get out of the pile.
Early on he was a chemical engineer PhD.
And his boss asked him to present
to his boss about some plastic.
And instead, he presented to the boss about the entire picture
of the plastics industry in 5 and 10 years,
and did this McKinsey-like presentation.
They couldn't believe it.
But that's overdelivering.
And so the question is, are you thinking expansively
enough about your work?
And that is the way to manage your careers,
if you are constantly overdelivering.
And you've got to have a certain natural love
and joy above the work to be doing that,
and a certain natural engagement and curiosity about the work
to be doing it.
Otherwise, it's really hard labor.
JACK WELCH: One thing to think about--
and this is a simple little tip.
Is your boss a lot smarter after the meeting you had with him
or her than before the meeting took place?
Is your boss going out and can go to a cocktail party
and can blow smoke about something
you gave him beautiful insights into, or gave
her insights into?
Can he just end up smarter?
Did the boss just sit through a mind-numbing, boring regime
of you telling him what you've done, and how you're doing?
Or have you given him an expansive, broad view
of the subject that he asked about
or the meeting was supposed to be about?
Think about that every time.
Never go to a meeting without making
the boss you're dealing with smarter for having sat
through that meeting with you.
Simple tip, but think about it.
LASZLO BOCK: But what I love-- and then we'll
go to the question-- is that you keep
coming back to things that I, as an individual, control.
I control how much work I'm putting in.
I control whether I'm going above and beyond.
I control what happens in that meeting with the boss.
I control do I ask about-- the woman who asks,
what's my rating?
What's going on?
There's a huge focus on that.
And that's very different from the typical advice, which
is, well, chart your course, and check these boxes,
and get this experience.
JACK WELCH: I hate it.
Why would you?
We have an example in the book.
Everyone says, oh, get a lot of multifunctional experience.
That'll do a lot for you.
I always say, don't bring skates to the basketball court.
That's for hockey.
Don't try skating on the basketball court.
Michael Jordan tried playing baseball.
He stunk at it.
OK?
He went into pro baseball.
And do what you're good at and just excel like hell at it,
and the sky's the limit.
LASZLO BOCK: That's how a chemist becomes a CEO?
JACK WELCH: Yeah.
LASZLO BOCK: Yeah.
How good a chemist were you?
SUZY WELCH: A very good chemist.
JACK WELCH: Pretty average bear, chemical engineer.
LASZLO BOCK: Yeah.
JACK WELCH: Pretty average bear.
LASZLO BOCK: Really?
JACK WELCH: Compared to other PhDs.
But let me tell you the difference.
I got a PhD with a Nobel Prize winner.
I got out in three years.
Most of my peers took seven.
They were all smarter than I was.
But they doddled.
They played in the lab.
They liked lab hours.
I wanted to get the hell out of there.
SUZY WELCH: He wanted to be with people.
JACK WELCH: I wanted to be with people.
LASZLO BOCK: Yeah.
JACK WELCH: So I wasn't smarter by any means, not even close.
But I was in a hurry.
LASZLO BOCK: I think that might have
made-- I think we could debate the smarter part.
I think you probably did all right.
JACK WELCH: I did all right.
LASZLO BOCK: We'll see.
We'll see, I guess, in the next few years
how things work out for you, Jack Welch.
Another question.
AUDIENCE: Thank you.
I was wondering if I could ask a question about smaller
companies.
Because I think we have a lot in common
here with small companies.
I was just curious if you, having your experience at GE,
a big corporation, if there are any-- because I think
small companies are often proud of the fact that they're small,
and they don't have much in common with corporations.
What do you think smaller companies could incorporate--
practices, learnings-- from a big company
that you think they often overlook
or avoid intentionally?
JACK WELCH: Well, what a company always
wants to be-- don't forget that plastic story we started with.
I was the first employee, and 18 years later, we're
a $16 billion company.
We had one technician.
I hired the first one, the second one, the third one.
Now, we had the luxury of building that $16 billion
company in a big corporation that didn't know anything
about plastics.
So we were shielded, and we had lots of money.
We had a bank behind us.
So we weren't out starting it up from the ground.
But what does a small company never want to be?
It never wants to be a bureaucracy.
What does a big company want to be?
It wants to get rid of layers.
It wants to de-layer and become a small company.
But what does a small company want to be?
It wants to have leverage in the marketplace.
So it has to have unique products to get leverage
in the marketplace.
It must be unique.
It can't have just coverage.
So you want the muscle of a big company
and the heart of a small company.
And all these things don't go together.
For example, when you talk about business as a sport,
the team with the best players wins.
That's what I happens in sports.
The team with the best players playing together wins.
That's what happens in business.
So it doesn't matter whether you're
a small business or a big business,
you want the best players.
You want to constantly reward the best.
You want to do all the same things, but you don't want--
I was talking at LinkedIn yesterday and talking here
today.
You guys are now a bureaucracy.
You can have all the food and all the stuff around here,
but you're a bureaucracy.
Come on.
You got guys like him with forms and all that stuff.
It happens.
LASZLO BOCK: I'm going to survey them about this talk
afterwards.
I want the forms.
SUZY WELCH: You have to fear and loathe--
JACK WELCH: You're fighting every day,
but you've got layers.
You're adding layers.
You can't have this many people and not have layers.
But you've got to fight.
Every layer has to go through the scrutiny of-- you've
got to start from the standpoint of I
never want to have a layer.
When you're starting a small company, give them a salary.
You don't have to give them a title.
Give them a salary.
Give them more span.
I had 29 direct reports.
Ideally, I should have had 60 probably.
Because if you don't have a lot of draft reports,
you can't meddle.
And if you're good people, you want
them to have their own heads.
So you've got to fight like hell all the time
not to layer up a place.
Every layer is evil.
It spins messages.
It delays decision making.
It does all these terrible things.
LASZLO BOCK: So on this point, one of things you
talk about, one of these--
JACK WELCH: I probably didn't answer your question,
but you understand the theory.
LASZLO BOCK: One of the things you
talk about in terms of bureaucracy
is you touch very briefly on budgets.
And you talk about how every company has these budget
negotiations internally about how much you're going to spend.
And you write-- there's this beautiful line about,
and somehow, you always end up in the middle, right?
Because people-- how do you cut through that?
How do you get people to be honest?
JACK WELCH: Look, the main point in this book
is what a leader's job is.
It's to create an atmosphere of truth and trust,
where every meeting-- you can have a neon light up here--
there's only truth being spun here.
No spin, no BS.
We want the truth only.
Because everybody comes in with a pitch,
and they have their own biases.
They're pitching it, spinning it.
Let's take the bunch of review as a perfect example.
I'm in the field.
I come in to headquarters at Google here with my budget.
And I'll come in and say the market stinks.
The world's coming to an end.
The Chinese are killing us.
This is happening here.
All I can do is two.
And then the bosses here will say, I need four.
And you go into a windowless room
and sit there and bang heads.
There'll be no customers, no analysts, nobody around.
And you'll sit there for seven hours with presentations,
and slides, and all that stuff.
And you'll come out with three.
That's the budget for the year.
Nothing will have happened.
The only measurements that count is
how did you do against last year,
and how did you do against any competitors you
measure against?
That's all that counts.
Measuring against a budget is the dumbest thing
that was ever invented in business-- the dumbest thing.
Because a budget is a negotiation
between two human beings.
It has nothing to do with the world.
It's crazy.
It's stupid.
LASZLO BOCK: Yeah, you about looking at variance instead,
right?
You talk about variance instead?
JACK WELCH: Everything's variance in my mind.
We have a chapter in here-- "Don't be Afraid of Finance."
If you understand variance analysis,
how does the marketing budget compare to last year?
And are the sales going up because you
doubled the marketing budget, or are they not?
Everything against a variance, against last year,
against two years ago.
And you're acquiring a company, why
are you going to spend that much versus what they spent before?
Everything's variance.
It's arithmetic.
Is not DCRRs, or DSDCFs, or IRRs, and all that crap.
You don't need it.
You need to understand variance.
That's what you need in finance.
LASZLO BOCK: I don't know if Cliff's still here
who has the Dory questions, but if there's one--
AUDIENCE: We got them all.
LASZLO BOCK: Oh, we got them all?
OK.
And if there's any other questions,
we've got a few minutes left.
Two last things, one super-- well, actually,
in all your travels, what's the biggest business opportunity
out there?
What's the biggest, most exciting thing on the horizon?
And not at a high level, like online learning, or digital,
or something like that.
But if you were starting out, what industry would you go in?
What problem would you tackle?
What would you do?
JACK WELCH: You want a go?
SUZY WELCH: I think that's one for you.
I can do one thing.
I can write.
So for me, it's like the world doesn't need that many more
writers.
JACK WELCH: Well, I think biotech
is just the most exciting area in the world right now.
LASZLO BOCK: Why's that?
JACK WELCH: Because you're dealing
with a clear-cut mission.
You've got one mission.
It's easy.
Now, we have a medical system business in GE.
We buy medical companies.
It's not a problem getting the mission understood
by everybody.
You're changing lives.
You're making lives better.
You're doing all that.
I think it's a frontier now with enormous upside to explore.
LASZLO BOCK: But people have said this
about biotech, like 10 years ago, 20 years ago.
Is it different today than it was?
JACK WELCH: Yes, it's much hotter now.
There's much more breakthroughs.
Drugs are coming out much faster through technology.
LASZLO BOCK: Yeah.
What about-- well, actually, do you want to?
JACK WELCH: Yeah, sure.
AUDIENCE: Hi.
Thanks for coming.
I'm in a position where I'm choosing a new team right now.
What are some of the things that I should be
looking for in my new manager?
What should I look for in a boss?
JACK WELCH: You are choosing to go to a team?
SUZY WELCH: No, you're building a team?
AUDIENCE: No, I'm moving to a new team.
SUZY WELCH: OK, so what are you looking for in your boss?
JACK WELCH: Go through it.
SUZY WELCH: Your generosity theme?
JACK WELCH: Yeah.
SUZY WELCH: So there's one characteristic
that we think separates a good boss from a great boss.
And that's this thing that we call the generosity gene.
It's technically not a gene, but it is a-- OK,
I have to say that.
LASZLO BOCK: Hold your questions on that.
She knows it's not a gene.
SUZY WELCH: And I only say that because Jack
calls it the generosity gene, and I'm always there piping up,
saying all right.
And maybe it is, what do I know?
But I think what it is, and you've seen it,
and you've all experienced it.
It's this preponderance, this desire, this burning desire
in an individual to see the people working for him
or her growing.
And they get really psyched about giving promotions,
and raises, and seeing people get things right,
and just getting better.
We've all worked for bosses with the generosity gene who
have this incredible heart of love, really,
for people to grow, and to get better, and really love you
as an individual, and see you get more money,
and see you get promoted, and see you even leave the team
to go on to bigger and better things.
And then we've all had the bosses who steal your idea
and use it as their own, and really
get stingy around raises, and really get
stingy about celebrating you.
And so if you're looking for what team
you're going to go to-- because you'll go the extra mile.
And the team will be that much more energized
when the leader has got this generosity gene.
JACK WELCH: And if you think about it-- stay there a minute.
If you think about it, if you think
about it in this room, all of you,
you've worked for both types.
You've worked for people with a generous spirit.
You've worked for people that didn't have it.
Where was it more fun?
Where was it more enjoyable?
Because when I look at the people that
have led in our company, in the companies I've worked with,
74 private equity companies and GE.
If I look at these guys, the winning people, male or female,
they had this experience.
They loved to see their people grow.
The biggest thrill for me is we've
got-- you can count them-- 50, 60,
70 CEOs out there now who work for me.
Many of them-- you refer to one in your book, Dave Cote.
They were all chief executives of GE businesses.
That's the biggest turn-on in the world
to have the Boeing CEO, the Honeywell CEO, the Home Depot
CEO.
All these people were my partners.
They're my friends.
And the nice thing-- Google's got to have that.
They probably have a lot of it now already,
whether it be Marissa Meyer, or whoever else is out there.
You'll have the same raft because you've
got a human resource process that works.
And that's one of the great thrills of life
to see these people sprouting up all over the place from Google.
And Google will be the GE of the last 20 years,
20 years ago, going forward.
They'll have tons of CEOs out there running companies.
And it'll be the biggest turn-on for Google.
LASZLO BOCK: It is.
It is.
It's amazing to watch, folks.
So last question for each of you.
JACK WELCH: Thanks for that question.
LASZLO BOCK: You write in one of the concluding chapters.
You say, to quote from Mark Twain,
"the two most important days in your life
are the day you were born and the day you figure out why."
I'd love, if you don't mind, for you to share
why were you each born?
Why are you here?
SUZY WELCH: I happen to be a devout Christian.
So for me the answer is just going
to be I was born to glorify God.
So I think that's a really personal thing,
and probably if there's any other Christians in the room,
they would have the same answer.
So that would be the answer.
Now, how I glorify God is I have a gift, which is writing.
And I discovered that I had that gift, like many writers do,
when I was really young.
I started a diary when I was nine years old.
And I wrote in it every single day.
And if I didn't write in it, I felt like something
was really wrong.
So I was really lucky to be able to have that gift.
And then I've been unbelievably blessed
to find many different ways to use that gift
to change people's lives.
And in fact, when I was running HBR
when I would try to recruit people,
I would say please come join me help change the world.
That was just incredible.
So I was able to use my gift.
And all writers use their gifts in different ways.
LAZLO BOCK: That's amazing.
Thank you.
JACK WELCH: No, I just happened to be lucky.
Luck plays an enormous part in where you get to in these jobs.
You bust your butt.
You do all these things.
But I love people.
And when I took this job on, from the first plastic,
I loved my first employee, to my second employee,
to my third employee.
I like hanging out.
And I like being with people.
And contrary to what Laszlo feels--
and he's smarter and brighter in some ways.
SUZY WELCH: Going for you.
JACK WELCH: No, I believe in my gut.
I'm a gut guy.
I'm not an analyst.
I have a PhD and all that stuff, but I believe in gut, and feel,
and touch, and people.
And I'll hire, and I'll make mistakes with my gut
many times.
But so far, people like me.
They work hard for me.
We all work as a team.
It isn't me.
But I always hire people smarter than me in every job
I've ever been in.
And I like them.
I like hang around with them.
If you like people, it's a fun job.
It's a great job.
And that's what I like, and so it all worked out.
I was captain of sports all through college.
I was captain of sports in high school.
People tend to let me be captain.
So it seemed to be fun, and I've never stopped liking it.
That's why we keep doing this.
We love these interchanges.
We learn everywhere we go.
We see these magnificent people doing things.
And it's wonderful to be out here where
you're seeing all this growth.
Because growth really is an elixir of life.
It truly is.
It gives you a whole new jolt. And we're
lucky enough and fortunate enough
to have people come and listen to us.
So thanks for being here.
LAZLO BOCK: Thank you.
[APPLAUSE]
And if I can just say two quick things in closing.
One is it's not often you have a discussion about a business
book that then hinges on talk about God, and love,
and changing the world, and transformation.
So it's an incredible gift to have both of you here
and to have you share the wisdom you've both accumulated.
So thank you on behalf of Google.
SUZY WELCH: Thank you.
LAZLO BOCK: The other thing is I know just for this room
that you both offered to hang around and say hello to folks,
anybody wants to come up and chat.
And we have some books back there
that you're free to take, some others when
we run out that you're free to purchase at a discount.
I imagine your hands aren't completely sore and broken?
JACK WELCH: No, we're happy to sign any books.
LAZLO BOCK: You can probably get a few signatures.
But thank you, sincerely, for sharing your message.
SUZY WELCH: Hey, thank you for being here.
Thank you.
JACK WELCH: Laszlo, thank you.
LAZLO BOCK: Really appreciate it.
Real pleasure.
[APPLAUSE]