Don’t Listen to Jack Welch (Only His Best Part)

Jack Welch advises executives to leave their rooms and find out more about organizations they manage.

I’m afraid, this is what executives will do. Why? Welch makes two points. First, he shows the problem, which is real for sure. Knowing your organization is important. Second, he suggests to solve it by visiting “stores, trading floors, regional offices, factories.” It’s also a good point, but not the best solution.

By taking Welch’s advice literally, executives will find no more than a mess of emotions, stories, suggestions, and demands. It’s like reading a morning newspaper: you really need a lot of prejudices to make sense out of this flow of information, when this flow doesn’t have any sense. It’s best at confirming existing prejudices. If you really want to know something about the world, you should do a comprehensive study on topic.

How does it look in management? If you want knowledge, organize it. Build an IT system that let your people talk freely (even if anonymously), send requests to supervisors, get feedbacks, and discuss ideas in a single place. Not face-to-face meetings of the king and His Majesty’s subjects (it always looks this way). It must be a distant platform. A person must know it’s for real and feel no pressure.

Computers are stupid but extraordinarily good at handling whatever comes out of this. Can a human delegate 8.5 million problems to 3.7 million solvers in milliseconds? StackOverflow does this routinely and arguably saved more working hours than YouTube wasted. It’s a matter of minutes to find popular problems, topics, and experts. It’s easy to find where your help is needed. This system shows what matters.

You can spend time traveling around “stores, trading floors, regional offices, factories” to declare, like Jonny Cash, “I’ve been everywhere.” Or you can systematically improve the system that delivers real information from real people right to your armchair. An IT system is better at everything that travels can do: moods, relevant problems, upcoming disasters, and best ideas. Exciting travels, as Welch noted, show that you’re not alone. But they are not for decision making.

Computer-driven operations at Amazon and Walmart have beaten flesh-and-blood shops around the corner. These systems know what customers want, unlike shopkeepers who talk to their customers for hours each day. There must be some sense of modesty regarding own abilities to admit this, but it would be one level up in business management. The creators of Amazon and Walmart could improve because they recognized their limitations and let machines do their work.

This transformation is slow in management because of the email reputation IT systems have. They’re something delivering tons of letters you have no time to read. It’s a failure of design. Emails came from the 70s and haven’t changed since then. ERM and other “management” systems often copy emails in asking too much irrelevant information. They lack human input and the sense of importance. But that’s how public web services looked in the 1990s. Since then they’ve changed tremendously; and so will B2B systems. Don’t miss this moment traveling.