The New Rules: Fortune Takes a Shot At Jack Welch

Jack Welch is a CEO superstar. While there are those who question the underlying reasons for his success at GE, there is no doubt that GE stock performed extremely well under his tenure and that attaching his name to something almost guarantees success. Now, Fortune magazine has revisited the rules from Jack's book, Winning, and is questioning whether or not they still hold true.

If applied correctly, Welch contends, his rules can work forever.

Sorry, Jack, but we don't buy it. The practices that brought Welch, Goizueta, and others such success were developed to battle problems specific to a time and place in history. And they worked. No one questions today that bloated bureaucracy can kill a business. No one forgets the shareholder – far from it. Yet those threats have receded. And they have been replaced by new ones. The risk we now face is applying old solutions to new problems.

Personally, I think Jack's rules are mostly bunk. From what little I know about GE, I would say that the key to their success has been the economic diversification of their product and service portfolio, their focus on manager development and training, and their AAA credit rating that allows then to borrow cheaply and make a killing with GE Capital.

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And with all due respect to Fortune, their "new rules" aren't really so new. Still, this is an article worth reading.