Jack Welch, Jack Welch Management Institute founder, explains how a “split role” in executive leadership leads to “shopping” the company. Jack Welch was on CNBC today below are all the clips and computer generated transcripts.
Split Chairman & CEO Role? ‘Dumbest Idea in the World': Jack Welch
our guest host this morning, jack welch founder the jack welch management institute, so many other things, former ge, ceo. how many board were you? none. you glefr did a board. you know what we talked about elan the cramer slrks ceo split up. andrew has been evolving. you were sure we should go the european route. no, i don’t think so. there is no data there to prove it. people think how can you be, how can more governance ever be a bad thing? we made the point if someone is that good at making decisions, they should be the ceo. let me say something no one talks about in a split role, you get shopping where the employees shop the idea, you want to buy this company? how about you, you want to buy it? no, it’s a mess. shareholder democracy can sometimes work, sometimes you can have a great dictator, only when the dictator is great does it work. that’s the complicated part. when you got a leader that can make decision that jamie diamond was crazy. then dave cally. he was so unabashedly anti-splitting it up. but they said he didn’t have enough financial acan you men acumen. he’s deeply capable if finance. these whackos don’t know anything about it. they’re sitting down in maine in the corporate library talking about that stuff. i mean, that wroel crowd. so he learned to manage those quarterlys under the master. he managed the business, not the earnings. why would you ever miss an estimate? because you tell them what the estimate is. 30 days later you announce it. right. a endope can do that. it’s more about managing expectations and the business. managing the business. not the earnings. is jamie diamond an other ceos safe for that, given that resounding vote or do you think iss and empg everybody comes back — they can’t go at jamie. that was the, that was crazy when they go after the best one in the game. then to go after dave on financial acumen. dave was there 20 years on thef, jamie is working in finance. is there a time and place for it, though? one of the things i think about. only to ask for a ceo. if you go back and look when jamie diamond, treks, it was a tron situation, bill harrison was the chairman when jamie was getting that done. i can see a time, for example. in six months when a guy was leaving? if jamie dup was going to step down, they had a succession plan, maybe you make him the chairman the next year or two to help out. a year. maximum. six month, preferably. okay. you give the guy the job. or the woman the job. they get the job. they make the decision. you don’t like them, throw them out. i’m not against firing them. but this idea of splitting for corporate governance and then they make this mistake with cody i felt was bowl saying he has no financial acumen, he has more, he’s forgotten more than the whole crowd will ever know. okay. we got to go. i’m just wondering, there’s got to be a way of making sure that boards aren’t just rubber-stamped of, you know, ceos. if the decisions are bad, the stock goes to held. if they’re friends with, golf buddies with the chairman and ceo. do you think you want to fight on the board? you don’t want fights on the board. you want smart people. if it all works well. cohesively. i sort of understanding. there are sometimes companies screwed up. that’s when you want the
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our guest host this morning is jack welch, a founder of the jack welch management institute. so many things to talk about. so little time. what i want to talk to you about honestly is the dynamic between the fed and unemployment and where we really have in the economy. do you want to talk about snowden initially? is that something? no, i’ll go anywhere you want. on snowden, that he broke the law, should be prosecuted. they should send him back here and prosecute him to the full extent of the law. the i give you my conspiracy theory, you said the president gets an a on this nsa stuff. i think they know that. i think this got us off the irs thing. i know, now we are talking about this i think he is right, no, we’re not talking about lois lerner anymore. that’s a real scandal. looking at metadata to catch terrorists. are you really going to be mad at the president for doing that, no? thoughts by the board. that’s off in the front. it will come back. it will be back. this took, she’s like, god, i love this snowden guy, isn’t she? she’s somewhere drinking a martini. here’s the qui i have. obama you says gets an a for this, snowden should go to jail with this? yeah. are we all cool with all of it? i’m wondering how far it goes. i think we got to understand, but when you have two presidents, totally different ideologies, you have feinstein and you have rodgers saskatoon be further apart. when al gore called it an abomination, then you know it’s the right thing to do, don’t you? just from — i don’t want to go there. oh, you’re chicken. no, i’m not. as a former ceo, what is the role, though, of th companies. you heard all the companies denied it or verizon not saying anything yet. when you were a ceo the ceo of ge, did you guys ever provide information for the government. did you ever have top-level conversations, tease type of things? no. was there somebody in your company that provided information? no, not that i knew of. not that i knew of. because you guys had access. not that i knew of, no. never happened. so we got your take on each scandal, a a.p. scandal, float your boat. the media, that’s the first time they paid attention. is that press scandal? no, it’s not. have you noticed out of these five scandals the four or five the media in this country didn’t break a single one of them. that’s interesting, but benghazi is misleading at best. that’s not a good — that was a bad situation. the way that. that’s just awful. we had lazear on the bush administration, admit it, the idea, never had talking points given to him on what he was supposed to say, put together by the white house that someone is supposed to read verbatim to spin something. the irs tragedy is a real scandal. right. the a.p. let the media fight if him. i can care less about him.