We really view ourselves as a series of laboratories that share ideas, financial resources, and management people.
Keep learning: This is one of the anchors of Jack Welch’s business philosophy.
Don’t be arrogant, he insists. Don’t assume you know it all. Always assume that you can learn from someone else. From a colleague, for example, or even from a competitor.
Especially from a competitor!
SCOUR THE LANDSCAPE
Welch exhorted his troops to scour the corporate landscape for good ideas and then to appropriate those ideas. “Legitimate plagiarism” he once called it: borrowing the best.
Some might wonder why GE—arguably one of the strongest companies in the United States—needs to go hunting for good ideas. Shouldn’t GE be teaching other companies what business is all about?
Absolutely not, says Welch. Every organization has to learn, and GE is no exception.
Here is Welch on the subject:
At the heart of this culture is an understanding that an organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive business advantage.
THE BADGE OF HONOR
It is a true badge of honor, according to Welch, to grab good ideas and run with them.
This kind of opportunism begins at home. Welch likes to point out that GE businesses share many things such as technology, design, personnel compensation and evaluation systems, manufacturing processes, and customer and country knowledge. The gas turbines business shares manufacturing technology with aircraft engines. Motors and transportation systems work together on new locomotive-propulsion systems.
But the learning continues beyond the walls of GE. For example, GE has adopted and adapted new product-introduction techniques from Chrysler and Canon, effective sourcing techniques from GM and Toyota, and quality initiatives from Motorola and Ford.
Note that by definition GE isn’t “first” with these ideas. GE did not invent the Six Sigma quality initiative. (Motorola pioneered it.) GE wasn’t even the next large company to get on board. (AlliedSignal was an early adapter.) But GE watched Six Sigma go through its shakedown cruises at other companies and then adapted it for its own purposes.
A large company like GE has access to a whole world of ideas, but the only way to turn that access into a competitive advantage is to develop what Welch calls a “pervasive and insatiable thirst” for those ideas, a compulsion to share them, and a mandate to implement them.
These are our three ingredients for success, whether the business is appliances, lighting, plastics, or something else: Build a good team, share ideas across businesses, give them resources to go. That’s it.
MOVING IDEAS: A KEY TO A LEARNING CULTURE
Moving ideas, Welch likes to say, is easy—assuming you have a learning culture.
One favorite Welch example of the learning culture in action came from its medical systems business, which created a CT scanner that operated remotely. The scanner allowed a user to detect and repair an impending malfunction on-line, often before the customer even knew a problem existed.
Medical systems shared that technology with other GE businesses, including jet engines, locomotives, motors and industrial systems, and power systems. Using the new tool, those other GE businesses could monitor the performance of jet engines, locomotives, paper mills, and power plants.
Welch was once asked how knowledge was transferred among the various GE businesses. He noted that every quarter some 30 GE managers hold a 2-day meeting. Each executive stands up in turn and presents new ideas:
When we leave there after 48 hours, we may not be the smartest people in the world, but we are the most knowledgeable at that moment, because we have been exposed to all these relevant topics. . . .
Most organizations don’t go for ideas in a meeting. Why not? Because everybody present comes from the same business. They talk about the vertical business. We talk about compensation plans, about China, about generic experiences.
Building a learning culture has put pressure on GE’s business leaders. They understand there is no reward for simply having a good idea at GE. The rewards come from successfully sharing that idea with others.
WELCH RULES
- Make searching for new ideas a priority of every employee. In today’s competitive environment, organizations can’t afford to leave anyone out.
- Hold idea-sharing meetings on a regular basis. Get a diverse group of managers together regularly. Make sure their ideas are translated into action.
- Reward employees for sharing knowledge. Find a way to reward managers and employees for sharing ideas and putting best practices to work at every level.