The Economist magazine’s Business.view blog has some fun with Jack Welch’s new MBA program, which the legendary/controversial CEO (he was once named “Manager of the Century” by Fortune, but the company he ran, GE, has been a shareholder graveyard for most of this decade) will be offering online in partnership with Chancellor University.
So what exactly will you learn at the Jack Welch Management Institute? According to our friends at The Economist, it sounds like what’s on offer will be the standard MBA boilerplate. And Welch was, for good or ill (there are strong arguments for both those positions) never a just-going-through-the-motions-and-waiting-for-my-options-to-vest CEO. So why not offer a truly different MBA, one with the ambitions of Jack Welch? The writer speculates about what a real Jack Welch MBA would look like….
For a start, in keeping with the no-BS style of a man whose autobiography is called “Jack: Straight From The Gut”, your columnist suspects there would be no place for the sort of bleeding-heart “MBA Oath”, pledging to serve society rather than maximise profits, that Harvard Business School graduates have taken en masse this summer. After all, Mr Welch is credited with launching the shareholder-value maximisation movement with a speech in 1981 on “Growing Fast in a Slow-Growth Economy”. What Mr Welch cared about was quality—hence his embrace of the Six Sigma programme for total-quality management.
Equally unmissable would be the class on “Making Your Numbers”. Under Mr Welch, GE’s accounting was so creative it could be hung on the wall of the Museum of Modern Art (although it was all within legal bounds). Frequent use was made of off-balance-sheet vehicles, on a greater scale even than Enron. The firm’s huge, opaque financial arm, GE Capital, was used as a top-up fund in case profits in the rest of the business fell below the consistent growth promised by Mr Welch. Over the 80 or so quarters he was in charge, GE’s profits grew so consistently they were almost a straight line. Those were the days.
Is GE’s poor performance since Mr Welch left a reflection of how good a job he did, and how hard he has been to replace? Or is it his legacy? What an excellent topic for a case-study discussion for the first batch of students taking the Jack Welch MBA.