Jack Welch, GE's legendary CEO, has died at 84


Jack Welch died yesterday the long time chairman and CEO of General Electric one of most celebrated executives of his day was eighty four years old the legacy well sleeves is complicated it will be debated and case study to four years in particular the way he changed what American companies do profits above all shareholder value first in line marketplaces Katong has them General Electric once upon a time explicitly serve many masters workers research labs and last of all shareholders that's according to company documents in the fifties by nineteen eighty one in came a new boss Jack Welch he slashed underperforming divisions and workers he spoke at MIT in two thousand six you bring a man you say look this isn't working you're in the bottom ten United again in my money here let's over the next year get your move on my then cutting costs and pleasing shareholders was in vogue in Wall Street and work for G. its stock way out perform the market during the Welsh decades of the eighties and nineties Nicholas Heymann is long time G. analyst at William Blair she had no problem redefining the landscape and what would work and in that sense standout became kind of the Paul Bunyan of shareholder value creation shareholder value often came at a cost to workers it undid the post war corporate social contract says Rick warts but not the Drucker institute his book is the end of loyalty G. and vaporized about a hundred and seventy thousand jobs under Welsh up until that time only the term downsizing it really entered the American vernacular yet these kind of huge mass layoffs were still seen as pretty scandalous when will step down in two thousand one jeep your allied heavily on its finance arm GE capital which will build up and when the financial crisis came years later the company got hit hard law professor Margaret Blair at Vanderbilt's is that's when we'll just tone seem to change as the company got into trouble he conceded that maximizing share value is not always the smartest thing to do D. adage suggests that he changed his mind over time he must have begun to see if there were big problems in the underlying business well she may have been on to something today leading groups including the business roundtable blackrock and the Davos World Economic Forum are rethinking the shareholders first model in its

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