Capital

Kiss

I came across a little book the other day called “The Welch Way”. It describes in a very simple and compressed style, the way Jack Welch, the former CEO of General Electric, very successfully lead GE to one of the most competitive businesses in the world. His way is described in 24 lessons that can be learnt from the way Welch managed the company. What struck me is that much of what he was doing was simplifying otherwise complicated management structures and processes. In doing that he released resources and energy to focus on what really mattered like innovation and production. I'd like to share here a few of the 24 lessons, which I think will help us as we are trying to make our own business more effective. What is interesting is that the way Welch did things is almost opposite to the way we normally do business in Ethiopia . Have a look at the table below, which compares the Ethiopian way with the Welch way on a number of issues. I admit that I have largely generalised the Ethiopian way and realise that this does injustice to those who are managing their business differently. I'd like to encourage you though to reflect on the statements made in the table and make your own assessment whether or not it would be useful to try and change some aspects of the way you are managing your business.

No.	Issue	The Ethiopian way	The Welch Way
1.	Style	Formal and autocratic.	Find ways to loosen things up (informal dress code, flexible working hours, informal meetings, social events).
2.	Bureaucracy	Formal, complex, entrenched everywhere, delaying decision making, wasting resources.	Eliminate unnecessary work and procedures; work with colleagues to streamline decision making; simplify things.
3.	Leadership	Manage by authority; lead by intimidation.	Lead by energizing others; encourage, say thank you and let workers know how their actions are helping the company achieve its objectives.
4.	Management	Micro-manage everything; keep information to yourself; do not delegate; the boss makes the decisions.	Manage less; encourage employees to make their own decisions and learn; train workers; delegate and encourage workers to take responsibility; empower them.
5.	Tradition	Respect tradition; do as it has always been done; don't take risks.	Ask: “Why are things done this way?” Brainstorm with colleagues and workers on how things can be done differently; don't be afraid to buck conventional wisdom.
6.	Values	Values are not very important; it is the numbers that count.	Clarify values and let them rule; the numbers will follow automatically; lead by example; walk the talk.
7.	Participation	Workers work, managers manage.	Workers may have some good ideas on how things can be done better; make sure everyone feels free to express ideas; hold informal brainstorming sessions.
8.	Pace	Take your time; let us see tomorrow; delay decision making.	Move on; don't sit on decisions; communicate faster (email, hand written notes instead of official letters); don't hesitate.
9.	Goals	Set modest goals and accept mediocrity.	Don't settle for mediocrity; reach for more than you think is possible; stretch out; no punishment for falling short of a so called stretch goal.
10.	Vision	Often not described; often unrealistic; management and workers not able to articulate the companies vision.	The best leaders are visionaries; they have a vision and are able to articulate it; inspire others to execute on that vision; hire and promote those most capable of turning the vision into reality.
11.	Performance	Give orders and tell workers what to do.	Don't bully or intimidate; involve everybody; the best idea wins.
12.	Quality	Quality is management's responsibility;	Quality is everybody's responsibility; take pride in your work; seek out quality training.

In conclusion, while we are largely managing our companies and organizations in a formal way, with complex bureaucratic procedures and structures based on hierarchy, Welch encouraged informality, recognition of workers, empowerment, innovation and above all simplicity. In his words: “Bureaucracy hates change….is terrified by speed and hates simplicity.” I'd encourage you to indeed look at the way your business is organised and try and see how things can be simplified to enhance effectiveness and achieve results. Embrace the “Kiss” – or Keep It Simple S……”

Reference: The Welch Way – 24 Lessons from the world's greatest CEO, by Jeffrey A. Krames