Is this the Guy who Invented Mass Layoffs?

  • Is this the Guy who Invented Mass Layoffs?

  • freeman

    Organizer
    April 15, 2023 at 2:29 pm

    The bullet points:

    • Jack Welch was the CEO of General Electric (GE) from 1981 to 2001.
    • Welch is credited with transforming GE into the most valuable company in the world by the early 2000s, but also with short-sighted practices that ultimately led to the company’s decline.
    • Welch’s philosophy was that a company’s main priority should be to generate economic returns to its owners (shareholder capitalism). He implemented this philosophy by cutting costs, laying off employees, closing factories, and focusing on mergers and acquisitions. Welch also offshored jobs and replaced lifetime workers with contractors.
    • To boost GE’s stock price in the short term, Welch engaged in stock buybacks, a practice that critics argue discourages investment in innovation.
    • After Welch retired, GE’s stock price plummeted in the 2008 financial crisis, and the company never fully recovered.
    • In 2021, GE split into three companies and sold off its major assets.
    • Welch’s legacy is still felt in corporate America today, as many CEOs prioritize short-term gains for shareholders over long-term investments in employees and innovation.

    The video argues that Welch’s corporate practices, while initially successful in raising stock prices, ultimately led to GE’s decline. It criticizes the focus on shareholder capitalism and argues that companies should also prioritize investment in employees and innovation for long-term success.

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