"How many out there (of perhaps 6,000 HR managers in the audience) are perceived by your organizations as equal in importance to the CFO?" Jack Welch asked. About 10 percent believed they were. “That’s not enough,” he said.
Welch, former head of GE and a great supporter of HR, offered his tips for HR managers at the recent Society for Human Resource Management (SHRM) Conference and Exposition in New Orleans.
If I Owned a Football Team
Welch said that if you owned a football team, you wouldn’t hang around with the accountant. You’d hang around with the manager of player personnel. That’s where the action is. And that’s how it should be for HR managers everywhere.
How do you make your case? "Get out of the picnic and insurance forms business," Welch said.
Honesty in Evaluation
No employee should wonder where he or she stands. When we have layoffs, all the affected personnel are saying, “Why me?” That means there haven’t been good evaluations, Welch says.
Isn’t the 20-70-10 System Barbaric?
Welch spoke about his famous (or infamous) 20-70-10 system that he installed at GE. (Briefly, under the system, 20 percent are rated as exceptional, 70 percent as fine, and the bottom 10 percent are eliminated.) Don’t get the wrong idea about the 10 percent, he says. "The idea wasn’t to machine-gun them—we worked with them, found a better situation for them, or helped them move on. Many of them had very successful careers."
"The number one thing to do to prove your value is to develop rigorous development and evaluation plans," Welch said.
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“I don’t want to work for the man.”
The shock of the downturn has many employees thinking, "I don’t like this." Your stars might stay a while, but when things get better, they’re going to want out—a chance to control their own destinies—unless they work for a company that offers flexibility, growth, and excitement.
Challenge your organization to create that kind of atmosphere—"Grab them by the shirts." In today’s market, you have to get creative taking care of the best and raising the average. "Make it better every day," Welch said. Do not be a victim, a player who doesn’t suit up for the game.
Communicate like Hell
Everybody is scared these days, said Welch. Are you feeling excitement, thinking about new ways of doing things, and how to restructure to come out thriving? Or are you hunkering down scared? "You have to make it vibrate—feel the excitement of tomorrow not the pain of today."
No whining, said Welch. And no over-positive cheerleading either. "People don’t want cheerleaders when the thing is leaking," he added.
Walk the floor, tweet, do what you can to communicate, so employees think, “They’re working for me."
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Long-Term and Short-Term Management
"First of all," said Welch, "recognize that any jackass can manage for the short term—you just squeeze the hell out of it." And any jackass can manage for the long term—you just share your dream. But you have to do both, and that is hard.
Welch on HR: "HR is important in good times; it defines bad times."
In tomorrow’s Advisor, we’ll get Welch’s comments on work/life balance and mentoring—it won’t be pretty.
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It’s amazing to me that as HR folks we don’t heed our own advice until someone of Jack Welch’s stature addresses the issue. I for one, stopped planning parties back in the last 90’s and decided to join the group at the table so that when it was time to make decisions, HR’s voice was heard and no one had to think twice about whether or not it was the party planner making a suggestion, or someone who was truly a business partner being part of the managment team!
Jack’s 20-70-10 is apparently no longer being practiced at GE, since I know of an entire department that was terminated last year.
Since he is the former head of GE and I am the current head of HR, I do not really care what he thinks.
The piece on the legendary Jack Welch made me think about my hard working HR Colleagues who have earned the proverbial “seat at the table”: good! Don’t give it up and stand up for what’s right for the organization, its people and its clients. You are a true Business Partner!
It is however, becoming crystal clear to me that there has been an emergence, in certain circles, of other types of “HR partnerships” who claim to have their “seat at the table” when it is in actuality just a suspicious “chair” haphazardly pulled up for effect: they are there only for subservient obedience (to often enable unethical strategies and practices) and then, there are those “HR Partners” who…well, never mind the table, they’re not even in the room!
Recently I read about a loyal employee of Bernie Madoff (you know the mastermind “investment genius” [as he was called at one time], who conned people out of $65Billion); this loyal employee was indicted and arrested; he had worked for the firm for over 20 years and Madoff was his nurturing “mentor”(some mentor program!). This person admitted that the business was all fake and counterfeit, from the very beginning. He is naming many other employees who knew of the scheme that left many investors bankrupt and employees without a job.
Almost daily we are hearing of similar corruption and fraud schemes by large, very large organizations. Ido these organizatins have an HR department?
They had to have an “HR” department (compartment? Maybe they were in it for the ride?…)
So if HR existed in these fraudulent and corrupt organizations…only two horrendous realities are possible:
1) HR had in fact “a seat” the malevolent table and was fully aware of what was going on, but chose to be quiet either because of unspeakable fear of a brutal command-and-control management regime … or because they, too were beneficiaries of an embedded stratospheric “bonus system”
or
2) HR had, in fact, no clue of the corrupt, illegal practices and HR was, by virtue of their ignorance/lack of training/lack of involvement in the business, relegated to a back office paper pushing pawn and never given (and most likely they never demanded ), salient business information/data/scorecards/performance data/documentation/audit results/employee surveys…
In both cases I say: SHAME ON YOU, HR DEPARTMENTS TO THE CORRUPT!
You go Jack! This is great advice for the folks who are closest to the “people place”. I believe HR has an important mandate to be at the right hand of the CEO, CFO, GM. The HR people I know, and I have presented at many SHRM conferences, really want to help and not be paper pushers.
I could feel his enthusiasm for getting things done rather than wringing hands about the economy as I read this article. This is a time for HR to be the balance point between the fear of these bad times and the possibilities that come from working together to make a difference.
As i said earlier, you go Jack, and you go HR!
Jack and I are about the same age and my time spent at GE (1964-76) were mostly good years. The senior management just before Jack ascended to the top did not back HR (especially labor relations guys like me who were thrown under the bus in the 1969-70 strike). Many of us left GE in the mid-70’s because of it. But we learned a lot about what to do and not do while there, and all of what Jack is saying to SHRM members is accurate and what we carried to other companies. What a leader!
Jack Welch’s take on HR role is right on. Human resources should be focused on developing and evaluating an organization’s talent pool. My company, Nightingale, helps HR departments cut down phone traffic while providing a valuable service. For pennies per member per month our team of nurse case managers assists employees by explaining their health insurance benefit plan and helping them to use it properly. Nightingale also picks up where insurance leaves off by directing employees to funding sources for medically necessary treatment that is not covered by their plan. We also negotiate reductions on medical bills on behalf of employees who are responsible for them. Ginny Capone RN BSN CCM, President ,Nightingale, a division of Capone & Associates, Inc
In response to Maurizio, in some organizations, HR does not have control over situations. In my organization, the CEO has the final word on EVERYTHING. All we can do is document the problem, notify the CEO, and document what we’ve done to cover ourselves until we’re able to find another job and move on.