Bill Lane joined General Electric in 1981 and spent 20 years as the speechwriter for hyperkinetic CEO Jack Welch, who built GE into one of the world's most profitable companies by the time he retired in 2001. This story is adapted from Lane's new book, Jacked Up: the Inside Story of How Jack Welch Talked GE Into Becoming the World's Greatest Company (McGraw-Hill, copyright 2008).
What did I do to convince Jack Welch that I represented "candor"? I simply laid out for the General Electric CEO some views I had picked up around the company on whether he was being fair or mean, on whether employees were dismissing his pet initiatives as "hula hoops" or "flavors of the month," phrases that drove him up the wall.
I once told him that there was a class at "Crotonville," GE's internal management school, that included 35 guys but no women or blacks. Jack ripped the phone from the cradle and called Crotonville to shout at the manager about why we weren't doing better on this score.
I knew the Crotonville people would see me as an informant, and I'd have to go mend fences with them the next day. But Jack has a way of drawing things out of you that you wish you'd never said.
Jack knew I "swam with the fishes" at several levels of the company. I worked with his vice chairmen and with all his business leaders, ran a lot of meetings, spoke at Crotonville, and got a feel for everybody's perspective. I was friendly with most of the secretaries and the security guys. I even bowled in the blue-collar GE league.
Jack spoke frequently at Crotonville and addressed virtually every mid- to upper-level manager who came through. It was a genuine effort to stay in touch with what was going on in the company, although he was never really sure he was getting the unvarnished view on every issue. So he would interrogate people like me whenever he got the chance—providing me with the occasionally irresistible opportunity to torment him.
On one occasion he and I boarded his Gulfstream G-4 jet, and as we taxied, he turned to me with a friendly grin and asked, "So, Bill, who's screwing who?" He meant at GE's headquarters in Fairfield, Conn., and among the business leaders in the field.
This was a rare opportunity, and I seized it, shaking my head dramatically and saying, "There's an awful lot of stuff going on, Jack. You wouldn't believe some of it—but I can't give you names."
"Why not!?" (Loud and excited.)
"I just don't think it would be right. Some of it is going on right under your nose."
He got louder, but was laughing. "Tell me! Or I won't pay you!"
But I stood my ground, and he laughed and called me a few names.
The fact was, the level of misbehavior at senior levels of the company was fairly modest, with some celebrated exceptions. There was the rumored "stairwell incident," an acrobatic tryst between a male and female employee. An officer back in the '80s, who rode a Harley with the Hell's Angels, wound up in the slammer on IRS-related stuff. And there were other minor shenanigans of the type that should have a bar code on it because it goes on at every company—big and small—around the world.
Jack especially liked to pump his subordinates about what employees were thinking, because he needed the reassurance that they bought in to what he believed in passionately, which was mostly everything.
One of his rationales for selling off underperforming and sometimes ancient company businesses was that their sale would be good for the employees of those units. The air conditioning division, for example, had become a backwater. When we sold it to Trane, it became a major part of that company's focus, so employees were suddenly in the middle of the action.
One of the most resented divestitures was the sale of the housewares business to Black & Decker. Instead of big appliances, housewares made items like toasters, electric potato peelers, and that famous duo—vacuum cleaners and fans—known affectionately as "old suck and blow."
Now Jack was selling it all.
And Wall Street approved.