“Leaders Create Leaders, Not Followers” – Lessons From A Business Great
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"Leaders Create Leaders, Not Followers" - Lessons From a Business Great
By Jatinder Singh, Associate Partner, Lighthouse International
Quotes like "leaders create leaders", which you may have heard many a time before, are often said as platitudes with little practical application. However, Jack Welch, one of the greatest CEOs of his generation, is a person who truly lived this philosophy even putting his reputation and his company’s resources on the line for it...
An Infinite Return on Investment
In his biography 'Straight From The Gut', Welch talks about his vision for Crotonville - the training centre at General Electric and the base of it's leadership programs. In discussing why it was so important to him and the company’s success, he recalls having to do a financial plan for the training program, and when estimating the financial returns it would provide, he wrote...
"I drew an X and scrawled the word 'infinite' to make the point that the returns on our investment would last forever. I meant it."
His attitude towards investing and developing the people around him was even more remarkable because Welch was being heavily criticised at the time for shutting down a number of ineffective departments and businesses at GE. As a result, spending millions on training brought more criticism and claims of hypocrisy. Nonetheless Welch knew it was vital he invested in those who had potential and that they would deliver through greater creativity, effectiveness and ultimately more profit down the line. For Welch, leadership training had to be practical, so he got his hands dirty and taught many programs there himself! How many CEOs do you hear about getting directly involved in the training of their leaders? While he did make mistakes and it can be argued that his successor at GE Jeff Immlet hasn't done half as well, the principle Welch was working with of investing in the growth of his people was and is very sound.
Developing Future CEOs
Another incredible thing about Welch’s attitude is that he accepted it was inevitable that some of his leaders would need to leave the company once they had reached a certain level. In fact he actively encouraged people to go on to bigger opportunities. After all he knew that not everyone would be able to lead GE after he had gone and so they should have the opportunity to grow elsewhere. It has often been said that GE has created more CEOs than any other company. Developing our leadership skills and improving our personal effectiveness is an investment that provides returns for the rest of our lives as Welch sums up perfectly...
"Crotonville became a boiling pot for learning. Our most valuable teachers there became students themselves. Through their classwork and field studies, they taught the company’s leaders and one another that there often was a better way….Crotonville became in fact our most important factory."
Learning From Legends...
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Question 1 of 1
How much did GE under Jack Welch invest in Crotonville every year in order to develop his people?
That’s correct! It was half a billion dollars.
GE spent $500 million every year on educating and training their people and Jack himself took training sessions there over 250 times over 17 years.
Doesn’t that put into perspective how important legends see investing in themselves?
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