Jack Welch and Transformational Leadership Essay

3401 Words Apr 12th, 2008 14 Pages
Introduction

In 1981, 45-year-old Jack Welch became the eighth and youngest CEO in General Electric’s history. During his 20 years at the helm, Welch transformed the company from an aging industrial manufacturer into one of the world’s most competitive organisations, by building more shareholder wealth than any corporate chief in history. Time and again he reinvented the company, and time and again, his employees went along with it (Krames, 2002).

The paradigm of transformational leadership is useful in analysing how he was able to accomplish this (Dubrin, Dalglish & Miller, 2006). It is also useful in identifying the personal characteristics, the leader and follower values and the situational factors that contributed to his
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Being open to ideas, living quality, and having self-confidence followed. (Krames, 2002).

He created the cultural initiative ‘Work-Out’, a process in which managers listened to workers and gave employees a voice in decision-making. It helped to eliminate vertical and horizontal barriers and forever changed the way people behaved at the company (Krames, 2002). This process assisted Welch to achieve workable unity within the organisation, creating an environment of trust and openness that had not existed before.

According to Atwater and Atwater (1994), Welch’s orchestrated transformation of GE is testimonial to his ability to perform the role of explaining – to develop, articulate and effectively communicate a vision of what the company should be.

Transformational Leadership

Transformational leadership is an expansion of transactional leadership, which emphasises the transaction or exchange relationship between leaders and follower, such as money for work (Bass & Riggio, 1994). Transformational leadership adds to this exchange by addressing the follower’s sense of self worth to engage their commitment and involvement in the job at hand (Bass & Riggio, 2005). Bass (1985) describes the transformational leader as one who empowers followers and motivates them to work on collective goals instead of focussing solely on immediate personal interests. According to

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