Face Reality (The Welch Way)

Assume Everything is Fine
Face Reality

Jack Welch said that business, like life, boils down to one thing: facing reality, and then making the right decisions based on that reality, and then making the right decisions based on that reality. To him, there was no more fundamental --or important-- concept than this one.

The roots of Welch's "face reality" edict can be traced back to his childhood. Welch's mother always urged her son Jack "not to kid himself," to see things as they are, and not as he wished them to be.

Welch never forgot that enduring lesson, and it played an invaluable role in his success.

When Welch became CEO, most people thought that GE was in great shape. Although it was voted top company in America, Welch saw a company in trouble: one that had lost much of its market value, and one that was sinking under the weight of its own bureaucracy.

Although most thought that he should respect the company and its history, Welch decided to "start a revolution" and reinvent the company from top to bottom.

At the heart of welch's revolution is his "face reality" decree. From his very first day as CEO, he made sure always to see things as they truly were. He never fooled himself into thinking that things would just get better on their own. Once he recognized the reality, he launched strategies and initiatives that helped make things better. When he determined that many of GE's businesses, and laid off more that 150,000 workers.

Facing reality often means saying and doing things that are not popular. After all, who wants to hear that business is bad, or that things won't get better? But Welch felt that only by coming to grips with reality would things begin to get better. So the next time a boss or colleague says, things just have to get better if we just stay the course, consider telling that person to face reality. That's how Jack Welch turned an aging bureaucracy into the world's most valuable corporation.

Here are some ways to make sure that you don't "kid yourself," which might help you to see things as they are:

Look at things with a fresh eye:
Sometimes people are too close to things to see the truth. To get perspective, look at your situation as an outsider might. Start with a blank piece of paper and jot down the realities of the situation you are assessing. This might help you to see things in a more detached manner.

Don't fall into the "false scenarios" trap:
Many people in business just assume things will get better. That could be a trap. Don't make up scenarios based on wishes. You must face the truth. What can we do if things don't get better?

Leave yourself with several options:
The best time to change is when you want to, not when you have to. In assessing situations, construct several scenarios based on different outcomes. Always have a "plan B" if things do not go as planned.

How do you bring people into the change process? Start with reality... When everybody gets the same facts, they'll generally come to the same conclusion.

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From: Jeffrey A. Krames. The Welch Way: 24 lessons from the world's greatest CEO. New York, McGraw-Hill, 2004.
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