When I arrived at GE’s facility in Pittsfield, Massachusetts, in 1969, I heard about a young general manager in the plastics business there named Jack Welch. At 33, he was the youngest GM ever. With a doctorate in chemical engineering from the University of Illinois, he was working with miracle plastics in a business division that was on fire. Within a decade, GE was the leading supplier of everything from Apple iPods to NASA moonwalk visors. Pittsfield Plastics is where Jack became famous, and I arrived just as he was being promoted up the GE food chain. It’s also the focus of my own professional transformation.
In the early 1970s, under the mentorship of the unit’s general counsel Arthur Puccini, I prepared a defense strategy to head off a challenge by Germany’s Bayer AG to our multibillion-dollar Lexan patent. That made a solid impression on Jack, who recommended me for lead counsel of the plastics division. But the powers that be considered me too inexperienced for the job, which just made Jack angry; he didn’t like being overruled. So, determined to keep me in the fold, he offered me a managerial position that put me on an 18-month fast track through other executive operating positions. I went from strategic development to head of national sales. It was an enormous leap of faith on Jack’s part.
If I had gotten the legal appointment Jack wanted, things would have been different. Everything happens for a reason.
So Jack’s former office became mine, and I found myself knee-deep in strategic planning, the hottest game at GE. Now I was running a business and managing people, and one thing I quickly learned was the importance of spotting trends. Most businesses aren’t prepared to handle the black swans—the unexpected events that can have extreme consequences. All businesses need people who can project trends and create appropriate response strategies.
Jack moved on to Connecticut in 1977 to become a sector executive in charge of consumer products at what was then called GE Credit Corp. Two years later he was named vice chairman of GE, and 2 years after that Jack Welch became GE’s youngest chairman CEO. For my part, I decided it was fitting that I inherited Jack’s office back in Pittsfield, where he had taught me to get ahead playing by your own rules. I didn’t know I would soon follow.
The front lawn of Jack Welch’s home
Pittsfield, Massachusetts
June 1977
Who knew an old-fashioned ringer washing machine could weigh so much? But Suzanne and I were determined to drag the most hideous-looking one from a nearby city dump in our station wagon to place it on Jack’s front lawn down the street from us on Rockland Drive. We set it up in the middle of the night with a sign congratulating Jack on being “all washed up!” The prank honored Jack’s new position overseeing core GE appliances and GE Credit Corp., stepping-stones to his way to the top. It was our last bit of creative mischief.
Jack Welch was my boss, mentor, and friend for more than 3 decades at GE. The ebb and flow of our relationship mirrored the fluctuating connection between General Electric and NBC. If it wasn’t for Jack, I wouldn’t have been able to transform NBC into a major cable and entertainment player—but it also wouldn’t have been as difficult to accomplish. As chairman, Jack relied on divestitures and acquisitions as GE’s main growth strategy; I kept NBC focused on organic value creation buoyed by strategic partnerships. Our personalities and agendas were as complicated as the issues. The press never fully comprehended the breadth of our relationship, reducing it to simple equations like father-son, rival brothers, and best pals.
But it was never that black-and-white. Jack and I were both products of an Irish Catholic New England upbringing. We were both only children with strong-willed mothers who instilled in us a strong sense of ambition and self-confidence. We both were self-made businessmen.
Yet for all the places our professional and personal lives intersected, we were fundamentally different. I came to understand how he operated, in the way that good friends do. Knowing how and when to pull each other’s strings and press each other’s buttons was the key to working well together for so long. But I was never under any illusion. Jack would do what was right for Jack and GE first.
◆ Donald Trump, billionaire real estate developer, producer/star of the NBC series The Apprentice. Jack Welch was a great businessman and visionary who loved Bob Wright because he saw something in Bob that he just respected. You know I have a way of selling things. Bob used me so brilliantly to get a long-term deal with Rockefeller Center to acquire the floors occupied by NBC and GE. Jack saw Bob’s business acumen and he was attracted to that. There’s nobody that Jack Welch respected more than Bob Wright at the time. He really relied on Bob, and Bob did great deals for him in cable. ◆
Jack lived life as fully as he could. If he had three open hours, he would play 27 holes of golf. He’d get off a plane and he’d go out and have dinner twice. He drank too much and he ate too much, but he would never sleep enough. He could stay up all night and show up at a meeting the next morning looking like he had slept 8 hours. We all took shifts because no one had the stamina to be with him all the time. He was almost impossible to keep up with, although Suzanne somehow managed.
For several years the plastics division hosted ski weekends at the old Lake Placid Inn for all our big accounts. We would start the evening with a cocktail party, then a big dinner, and then everyone would take to the slopes for ski races. One typical Jack Welch weekend in the winter of 1976, we flung open all the windows because the radiator heat couldn’t be properly regulated. It was cold as hell outside, and Jack couldn’t wait to get out there and take on everyone. I remember Suzanne shouting out the window that she could beat him even though she’d only taken up skiing 3 months earlier. So she took him on. Everyone was shouting like they were at a baseball game: “What a bum you are; you’re a lousy skier!” It was hilarious.
Jack loved customers who wanted to play. He loved people who were competitive. I remember a dinner one night that went on forever, and everybody had too much to drink. Jack stood up and declared it was time to start the hockey game! The hotel had an outdoor hockey rink, so Jack chose up sides and pretty soon a bunch of 40-year-olds were running around, banging each other over the head with their sticks, yelling and laughing in the cold. The next morning Jack was the first person downstairs with a cup of coffee, organizing the day’s meetings.
Jack worked hard, partied hard, and played hard. That’s the reason he didn’t blow up, because he didn’t keep things in. Playing and partying were ways for him to shake off stress. That sometimes was awkward for other people, even if they knew it was a release for him. Jack was not a perfect person, but boy, did he have remarkable energy and great ideas! Jack was anxious for success, and he expected everybody around him to work as hard as he did. If you did that, he wanted you on his team.
From 1980 to 1983 I was in Atlanta with Cox Cable—a position Jack made possible. I was happy there and doing very well, but in April 1983, when Jack had been fully in charge as GE chairman CEO for 2 years, I got a phone call. “Listen, Bob, you’ve done a great job down there. I’ve been watching. But I need you back here at GE!”
This was Neutron Jack talking. He was already a legend for buying businesses, extracting the excess, and leaving only the buildings intact. Jack invited me to fly from Atlanta to North Palm Beach. “I have a nice story to tell you. I’ll pick you up at the airport!” So I met with Jack, Art Puccini, one of GE’s lawyers I had originally reported to, and Ralph Hubregsen, GE’s human resources vice president. I remember Puccini stretched out on the couch, ailing from a bad back, making a compelling argument for why I belonged at GE. That evening we all went to dinner with our wives, to a restaurant where jackets were required. I still have the white linen jacket I ran out to buy on the way, a memento of good times and warm climes. It was a great dinner with lots of boisterous conversation. Everybody was excited. That’s what it was like in those days. It all happened quickly, and I was sucked back into Jack’s gravitational pull.
The following month, Jack flew Suzanne and me to his home in New Canaan, Connecticut, to celebrate. He asked me to manage, evaluate, and recommend the potential sale of GE’s housewares and audio electronics businesses, which encompassed everything except televisions. Then he added an inducement. “If you get this right, you have a good shot at running GE Capital.”
That’s the most I ever trusted anyone making an unwritten offer. I thought it was a hell of an opportunity. So we relocated to Southport, Connecticut, near where the housewares division was located. Within 6 months I had traveled the world, assessing and more tightly managing the housewares and audio electronics businesses whose margins had virtually collapsed in a sea of cheap foreign exports. By December 1983, Jack had single-handedly negotiated a sale of GE’s small appliances and housewares operations to Black & Decker for $300 million in cash, stock, and notes. My job was to make Black & Decker executives comfortable with that deal before it closed in March.
And Jack kept his word: in 1984 I was promoted to CEO of GE Capital, reporting to Larry Bossidy. From then on, Jack and I worked together buying and selling, growing and redirecting GE’s businesses, often through GE Capital. One of the businesses we passed on was CBS. I thought it was a very good opportunity until we found out it wasn’t really for sale. Then in 1986 GE turned its sights on RCA and NBC instead, and that changed everything.
◆ Chuck Dolan. I remember Bob’s office on the 52nd floor of Rockefeller Center. The door was always open. And on the floor right above him was Jack Welch’s office, with a staircase that came down right next to Bob’s office. When Jack came down to see him it looked a little like God descending. But to Bob, it was just Jack. That’s how close they were. It was a wonderful partnership. ◆
I reported directly to Jack Welch for 14 years, from 1986 until his retirement in 2001. Before that I was never more than one report away from him. So I probably was closer to him for a longer period of time than almost anyone else at GE. I am very proud of our relationship. I racked up many successful deals and accomplishments that became part of Jack’s overall legacy. And he couldn’t help himself from getting more involved than usual in some of those business decisions. Jack could be my best ally or worst adversary as I pursued my contrarian game plan for NBC. He supported me one minute and then scuttled some of our best deals the next.
He couldn’t tolerate Ted Turner, so we never pulled the trigger on negotiated deals to acquire Turner Broadcasting and CNN. He trashed the acquisition for the Golf Channel that I negotiated when Suzanne and I were with Johnny and Alexis Carson in Scotland, out of concern that the GE board and investors would too closely align him with the sport. The irony was that NBC eventually did buy that asset, for market price. We could have bought the Golf Channel for an initial $50 million; a decade later Comcast, NBC’s new owner, paid more than $1 billion.
Jack had an incredible way of separating personal relationships from business. So while he loved his friends, he really loved business achievement more and he was vicious about it. If he could do business with his friends, it was great. And if he couldn’t, it was fine because not many of his friends were high enough achievers. Our friendship was steady, but our work relationship was sacred—and they were always separate.
Jack was a bit of a cowboy—a damn smart cowboy. Many of the aggressive things that he did back then he couldn’t do as easily today. When times were good, some board members would say things like, “You may not like the media business, but this guy can sure make money!”
GE’s board and senior management had little idea of how NBC worked. They thought it was like gambling at the Beverly Hills Hotel. For years Jack and I defended GE’s continued ownership of NBC—only to have him periodically shop NBC around behind my back, particularly when ratings and finances declined, as in 1991 and 1992. They were agonizing times.
While Jack didn’t give me a blank check, he did give me leeway to forge ahead, because we both knew broadcasting’s free cash flow business would change. I worked really hard to double NBC’s value my first 6 years as CEO while expanding the company’s cable horizons. Jack really didn’t want to sell the company so much as take the pressure off GE stock and appease institutional investors who were more comfortable with tangible assets like jet engines and light bulbs.
◆ Tom Rogers. There was no doubt that the most important relationship in Bob Wright’s working life was with Jack Welch. Don Ohlmeyer called it “as close a relationship as I have ever seen in business,” and any of us who witnessed it firsthand felt the same way. The relationship between Bob and Jack clearly involved a lot of mutual respect, but there always was some degree of tension that most people didn’t see. It was obvious to those of us working with them. Bob wanted autonomy to advance NBC’s business and had to go through Jack on most things. There were some occasional blowups and screaming matches behind closed doors. What was amazing to me was the way that Jack inserted himself more deeply into NBC’s business than he has admitted or was appropriate for somebody in his position. There was really no way to stop it or cut that off. But he never gave any sense—inside NBC or publicly—that he was undermining Bob. So, while Bob’s authority was never questioned, the level of Jack’s involvement could rankle him.
Bob felt that Jack could be unpredictable. Sometimes they were unable to get a consistent viewpoint going that was as strategically clear as it should have been. I remember the proposal to acquire the Sky Cable satellite service. It was something that NBC should have made happen and didn’t, largely because Jack didn’t want it. Had it turned out well, with a small company like Cablevision Systems driving the initial foray into satellites, NBC likely would be the co-owner of DirecTV today. But GE, which was already in the military satellite business, and Jack Welch had other designs.
Because of Bob’s GE pedigree, Jack gave him more leeway and sometimes quietly exempted NBC from some of GE’s controls. The access they had to each other, and the way they related in and out of work, was integral to the way they got things done. Then, about the same time Jack retired from GE, he and his wife, Jane, divorced. I think Jane and Suzanne were very close. And all of a sudden everything changed. Relationships unraveled and it was never the same. ◆
Jack did a lot of good for GE and its shareholders. But the stock increased an astronomical amount between 1996 and 2000 ($7 to $60 a share, creating a $530 billion in market cap) and got way ahead of itself. Jack began to believe the company was special because of him, and that created an absolute disaster. He got out with his publicity, and everyone else got stuck with the aftermath. The results after 2000 were just awful. The post-retirement exit package he negotiated was inappropriate and selfish (it included unlimited free use of a $50 million plane for the rest of his life!). He brought down all kinds of other people and horrible stuff happened. It all unraveled as he was leaving. He should have retired as CEO years earlier, but he didn’t want to go. If he had left in that 1998 period, maybe GE would have been a hell of a lot better off. GE should have used some of its inflated stock to acquire good businesses from 1998 to 2000.
Jack did such a good job for such a long time, and then in the late 1990s he let things get out of hand and the business got too big. Using GE’s overly inflated stock, GE Capital acquired too many diverse and risky businesses. That’s just a fact. Everybody knew it, but nobody knew what to do about it. A decade later, on his way out the door, Jack tried to redeem himself with the $42 billion Honeywell acquisition. But he waited too long, and the deal never happened. I believe he panicked. He was never going to fix it. That would have been a smart acquisition 2 years earlier, when GE had a P/E ratio of 40!
◆ Suzanne Wright. Over time, Jack started believing his own press. He just became a totally different person, and it hurt so much to see him change. He refused to come to our children’s wedding. Instead of just saying he couldn’t come for some reason, he said to us, “I don’t do weddings anymore!” That was it. It was personal. ◆
Jack Welch was preparing to retire from GE (a year later than expected) when he told me he was moving Andy Lack into my job as operating head of NBC. A year or two later that became a problem. Andy and Jeff Zucker were not getting along. Jeff had the runway to be CEO. I had taken NBC from basic broadcasting to cable and through erratic swings in profits. I was focused on ways to expand NBC’s audience and revenue base so it could compete with larger media players like Walt Disney, Viacom, and AOL Time Warner without hurting GE’s earnings per share. GE had no reason to be displeased.
I quietly convinced GE’s board that NBC’s divided house was not in the company’s best interest. I resumed as NBC’s sole commander in chief in the fall of 2001, with Jeff Zucker waiting in the wings. Jack had already retired, agreeing to personally pay for any of the controversial perks he sought that went beyond the normal exit package for a chief executive. GE was hit with a sever reprimand by the Securities and Exchange Commission. And Andy left to become chairman of Sony Music.
I always understood that many people had a love/hate view of Jack. They saw him as the greatest manager of all time or the biggest jerk of all time. There is a positive side to him and a dark side, too. I’ve seen all sides, and I know I was very fortunate to have worked with him. I got a lot out of our relationship. In the end, our falling-out was disappointing to me. It didn’t even have to do directly with the company. It had more to do with the way Jack handled his own personal and business affairs. That’s the nature of complex, layered relationships. It was more like divorce in a marriage where both parties still talk to each other and don’t hate each other, and wish things had happened differently. It is in part why Jack declined to contribute to this book when I asked. The thing is that Jack is stubborn Irish. Of course I wouldn’t know anything about that! So he never admits a mistake, and he’s not going to start doing that in his 80s.