What's a Strength-Based Strategy All About?
Jack Welch, former CEO of General Electric (GE), was highlighted on an episode of CNBC Titans in 2010. During the one-hour episode, Jack Welch said that he only wanted GE to keep the products and services that were number one or two in the market; the rest of the products and services would be sold to other companies. In other words, he wanted GE to focus on the products and services it was great at creating and selling, demonstrating a strength-based strategy. A strength is considered a characteristic of an entity that is consistently demonstrated to be near perfect every time (Rath & Conchie, 2008). I’m assuming that Jack Welch would agree to this definition, and would also add that, to him, a strength is being the top-selling product or service in the market.
Strength-based literature in the workplace seems to lean towards employees, leadership, and interventions. It is difficult, if not impossible, to find literature on strength-based strategy, which is exactly what Jack Welch was demonstrating. If GE’s products or services were not number one or two in the market, GE sold them and focused on what it was great at. Bottles (2002) states that focus is an important key to entrepreneurs’ success in business. We also know from the literature that focusing on one’s strengths increases confidence (McDowall & Butterworth, 2014; Wilson, 2006). In addition, who hasn’t heard the phrase, “They’re spreading themselves too thin?" With the evidence that is available, it is possible that a portion of GE’s success under Jack Welch’s leadership can be attributed to his strength-based strategy. GE focused its efforts on what its strengths were, while reducing the amount of products and services it wasn’t great at creating and selling.
Although Jack Welch’s story at GE is anecdotal, the literature out there supports his strategy of focusing on GE’s strengths (Garcea, Harrison, & Linley, 2014; Barton & Mackin, 2012). Prior to Jack Welch becoming the CEO of GE in 1981, GE had a market value of $14 billion. Upon his retirement in 2001, GE’s market value was a staggering $410 billion. Jack Welch increased sales from $26.8 billion to $130 billion during his tenure. It is important to note, however, that there is plenty of criticism surrounding Jack Welch’s style of management. I imagine positive psychologists wouldn’t condone some of his managerial tactics; after all, he didn’t get the name Neutron Jack for nothing. He laid off tens of thousands of employees, and some would argue he lacked compassion for the workers he laid off. Is that to say he wasn’t a successful leader? Perhaps that depends on how you define success.
To this day, Jack Welch believes one of his greatest strengths was being fair. As one of the identified character strengths according to the VIA assessment, fairness is demonstrated by treating all people fairly, not letting personal feelings bias decisions, and giving everyone a chance (Seligman, Park, & Peterson, 2004). He says that the tens of thousands that he had to lay off were either in the bottom 10% of performers or part of a department that was failing.
Do you think having GE focus on its strengths is what made it so successful? Is Jack Welch a job ‘slasher’ or simply a man creating a wildly successful company? After all, Jack Welch does pride himself on being a fair gentleman and focusing on what GE does best.
What we can take away from this example are a few key questions that, upon reflection, may help us in creating strategies to lead us to success. These include:
1. In what ways does your company excel? In other words, what are your company’s strengths?
2. How much time and energy is intentionally focused on these areas of strength?
3. If energy is not going into the organization’s strengths, where is it being directed instead?
4. How can energy be re-directed to ensure optimal performance?
Barton, W. H., & Mackin, J. R. (2012). Towards a strength-based juvenile correctional facility: Sustainability and effects of an institutional transformation. Journal of Offender Rehabilitation, 51, 435-452.
Bottles, K. (2002). Focus, exchange and trust mark successful entrepreneurs. Physician Executive, 28(2), 71.
Garcea, N., Harrison, R., & Linley, A. (2014). Living the future: A strengths-based example of restructure and culture at Boehringer Ingelheim. Strategic HR Review, 13, 111-117.
McDowall, A., & Butterworth, L. (2014). How does a brief strengths-based group coaching intervention work?. Coaching: An International Journal of Theory, Research and Practice, 7, 152-163.
Rath, T. & Conchie, B. (2008). Strengths based leadership: Great leaders, teams, and why people follow. New York, NY. Gallup Press.
Seligman, M. E. P., Park, N., & Peterson, C. (2004). The Values In Action (VIA) classification of character strengths. Ricerche di Psicologia, 27, 63–78.
Wilson, S. Z. (2006). Field education: Linking self-efficacy theory and the strengths perspective. The Journal of Baccalaureate Social Work, 12(1), 261-274.