So many people champion Jack Welch as such a great leader, but, at least as far as I believe, the “Welch-Way” is the wrong way. At GE, Jack Welch practiced short-term leadership. Life at GE was like a roller coaster ride due to irrational decision making with little regard for long-term implications. Every year, Welch fired the bottom 10% of his managers at GE to balance the books. And, GE profited, but it was rolling the dice and gambling with lives of employees for selfish gain — this is not strategy, this is greed. No, this is not leadership; it is just a survival of the fittest culture that breeds infighting, deceit, and short-term results.
This type of short-term vs. long-term leadership is a big part of so many our current problems in business. When getting in, making your nut, and getting out while the getting is good is the order of the day, it causes leaders to base their decisions on their OWN best interest not the best interest of the organization, the employees, or least of all, customers. So if you are regularly wondering why millennials switch jobs so often or want to make a difference today even though they’ve only been in a job for a few months; it’s a symptom of the short-term thinking we’ve made a cultural norm over the last twenty years or so.
The solution though is shifting that cultural norm to creating workplace cultures where leaders lead for the long-term. A good example is Costco, where Jeff Sinegal has shown us what long-term leadership means and how it produces results. While Welch was striking fear into the hearts of his managers (and his employees), Jeff Sinegal was creating strategies that kept employees employed even though the US was in an economic crisis. Sinegal believed that the company should be helping employees in bad times, not letting them go. He believed that keeping the family together created a strength and loyalty that would enable the company to come back with a vengeance when times got better. So, while GE’s stock was on its roller coaster ride, Costco’s stock was (and still is) stable and predictable — nothing exciting, just predictable progress, performance, and profit, and when you’re in it for the long haul with the success of others as well as yourself at your core instead of selfish gain and immediate gratification, predictability is better than spontaneity.
And if long-term leadership is step one, creating a positive work environment must be step two. When the environment at work is one of encouragement, where team-members help each other succeed, and one that meets people’s basic needs to live, learn, feel valued, and make significant contributions, we do more than just survive — we thrive…and so does the business…for the long term.