Hiring, the Welch way

The CEO of CEOs used the "4Es and 1P" principle to recruit a winning team

Winning was published by HarperCollins in 2005 and gave a fascinating peek into the leadership journey of Jack Welch who died earlier this week. Welch, who continues to be known as the CEO of CEOs even though his legacy at GE took a blow after he retired, was once asked at a public function, “What is the one thing you should ask in an interview to help you decide whom to hire?”.
 
Welch was well known for his quick repartee, but this was one question that stumped him. He got the answer only a few years later. In Winning, Welch says if he had just one area to probe in a hiring interview, it would be about why the candidate left his previous job, and the one before that.

 
“Was it the environment? Was it the boss? Was it the team? What exactly made you leave? There is so much information in those answers. Keep digging and dig deep. Maybe the candidate just expects too much from a job or a company. Maybe he wants a boss who is entirely hands-off or teammates who always agree. Maybe he wants too much reward too fast. Or maybe she's leaving her last job because she has just what you want: too much energy to be held back, so much ability to energise she wants to manage more people, too mu­ch edge for a namby-pamby employer and such a strong ability to execute she needs more challenge,” Welch, who co-authored the book, wrote.

 

The summary of what Welch was saying is this: Why a person has left a job or jobs tells you more about them than almost any other piece of data. Hiring managers all over the world would do well to follow the advice — something they often tend to ignore during an interview process. That’s because hiring good people is hard, but hiring great people is brutally hard.
 
His other favourite questions during a job interview were these: What does your competitive environment look like? In the last three years what have your competitors done? In the same period what have you done? Welch strongly believed that any leader or manager worth his/her salt should be able to answer the questions.

 
In recent years, many have questioned Welch’s strategy, leadership style and legacy. He is also known more as “Neutron Jack” for cutting thousands of jobs as a part of his policy of firing 10 per cent of his workforce every year. But the fact still is that he brought in many revolutionary changes in how hiring was done and had an uncanny ability to hire the right people while giving them room to spread their wings under his “Lead more, manage less” philosophy.
 
That led to the famous “four Es (Energy, Energise, Edge, Execution) and one P (Passion)” principle of hiring. This is what they stand for:

 

• Energy: Welch felt leaders with energy assume that the status quo is not good enough; last year’s performance again this year is not good enough; single digit growth is not good enough and business as usual is not good enough.

 

• Energise: People who energise can inspire their team to take on the impossible and enjoy doing it. The ability to energise is apparent in someone with an in-depth knowledge of their business, who sets a powerful personal example, and has strong persuasion skills.

 

• Edge: People with Edge make timely decisions (even the tough ones), spot new innovations, new markets and opportunities and have the ability to take calculated risks and even encourage others to do so.

 

• Execution: This is often ignored by interviewers. Somebody can have bright ideas, but can he deliver? People with good execution skills do not promise anything easily. Once they do, the top management or the board knows that it can consider it done.

 

• Passion: Passion is what holds the four Es together. Leaders must have a passion for what they are doing because then they would give it everything they have to make it happen.

 

Welch was quite clear that if this hiring process is followed, you get people who can do their job better than anyone else has done it before. Not only will they be able to present the employees with a vision and inspire them, more critically, they would be able to deliver that vision to their customers.