Ordinarily this column serves to remind me that, Jack Welch, this great hero of commerce has no special skills. His long string of decades of success in buying companies to add to the portfolio and profit of GE and succeed in managing such a diverse work force and product line was the work of other highly skilled people.
Jack was largely a bright rahrah....
Jack was largely a bright rahrah cheer leader who lucked into a new field, buying smaller underpriced companies (underpriced relative to GE's multiple). Managing the acquired companies was definitely a skill, but the techniques were decades old when Jack learned them.
wrote a column a few weeks back (The Real Verdict On Business "Enron-like behavior is rare. Most businesses play by the rules, and the
rules work" By Jack and Suzy Welch - June
12, 2006), ..... when Ken Lay and
Jeff Skilling were found guilty, that we should remember that corporate
dishonesty is limited to a few out of thousands of corporations.
an expert witness on executive compensation I have often testified about the
Jack Welch Scam as an example of corporate fraud. What Jack did, with or
without the knowledge of his board of directors (such obscure language that
only a few ever read it) was to guarantee his pension at 12% return. For those
of you who don't keep compound interest tables in your head, his pension of $
millions was guaranteed to double roughly every five and a half years.
Jack, your boss, as the senior executive and as part of the top executive staff that includes the Board is to give us clear information about all the financials of the company. By hiding your extremely lucrative executive bonus as a pension guaranteed return, you were hiding an highly relevant financial fact from us. You are a first rate fraud.
Getting no comment from Business-week on their publishing hypocrisy has made me realize that I probably don't need a weak, wimpy magazine in my reading list. Business is not about wimps and corporate intent to deceive investors.