It takes enormous self-confidence to be simple, particularly in large organizations. Bureaucracy is terrified by speed and hates simplicity.
In the late 1980s and early 1990s, Jack Welch began to outline a new vision for GE’s future. In September 1989, for example, he noted:
The biggest mistake we could make right now is to think that simply doing more of what worked in the ’80s will be enough to win the ’90s. It won’t. . . . We have to turn in the ’90s to the software of our companies—to the culture that drives them.
Welch summed up his prescription for that culture in three words: speed, simplicity, and self-confidence.
THE FIRST TWO “S’S”: SPEED AND SIMPLICITY
Speed, obviously, meant having people make decisions in minutes. It meant cutting back on paper flow and staff work.
Simplicity, as Welch defined it, meant different things in different corners of the company:
To an engineer, it’s clean, functional designs with fewer parts. For manufacturing, it means judging a process not by how sophisticated it is, but how understandable it is to those who must make it work. In marketing, it means clear messages and clean proposals to consumers and industrial customers.
And most important, on an individual, interpersonal level, it takes the form of plain-speaking, directness—honesty.
Writing to shareholders in 1995, Welch elaborated on the importance of simplicity:
Simple messages travel faster, simpler designs reach the market faster, and the elimination of clutter allows faster decision making.
In the case of senior management, a critical component of simplicity is a powerful, easily graspable core message—a vision:
Whatever it is—we’re going to be number one or number two, or fix/close/sell, or boundarylessness—every idea you present must be something you could get across easily at a cocktail party with strangers. If only afficionados of your industry can understand what you’re saying, you’ve blown it.
THE THIRD “S”: SELF-CONFIDENCE
The third S, self-confidence, is intimately related to the first two. In fact, argues Welch, one can’t really embrace simplicity without a healthy dose of self-confidence:
One of the hardest things for a manager is to reach a threshold of self-confidence where being simple is comfortable.
Where does this self-confidence come from? Welch’s answer has several parts:
Some people get it at their mother’s knee, others through scholastic, athletic, or other achievement. Some tiptoe through life without it. If we are to create this boundaryless company, we have to create an atmosphere where selfconfidence can grow in each of . . . us.
But many attributes of large organizations, such as the turf battles, the parochialism, and so on, work against the development of self-confidence:
Self-confidence does not grow in someone who is just another appendage on the bureaucracy, whose authority rests on little more than a title. Bureaucracy is terrified by speed and hates simplicity. It fosters defensiveness, intrigue, sometimes meanness.
Even if a company can’t manufacture self-confidence, says Welch, it can work against the confidence-destroying aspects of corporate culture. It can provide people with opportunities to dream, take risks, and win. And it can make sure that employees can see how their work contributes to the overall effort:
We can grow a work ethic that plays to our strengths, one that unleashes and liberates the awesome productive energy that we know resides in our work force. If we can . . . create an environment where each man and woman who works in our companies can see a clear connection between what he or she does every day, all day, and winning and losing in the real world, we can become productive beyond our wildest dreams.
This was one reason GE devised its Work-Out program: to design a process that gave people a voice and got them talking to one another and learning to trust one another.
Again, the three S’s are interrelated and mutually supportive. In his 1995 letter to shareholders, Welch commented:
Self-confident people don’t need to wrap themselves in complexity, “businessese” speech, and all the clutter that passes for sophistication in business—especially big business.
Self-confident leaders produce simple plans, speak simply, and propose big, clear targets. Speed. Simplicity. Self-confidence. They emerged and endured as key watchwords in the Welch management philosophy.
WELCH RULES
- Promote the three “S’s”: speed, simplicity, and selfconfidence. These three attributes build organizations that are able to change with the changing environment.
- Start with a simple message. The most effective communications are those that are easy to understand. Making the vision clear sparks people’s passion and productivity.
- Establish systems that foster self-confidence. Help people understand how their efforts are helping the company to succeed. Find ways to let people take risks and win.