In 1963, Jack Welch accidentally blew up a factory at GE — and it taught him a lesson about leadership that's stuck with him to this day
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Jack Welch is the former CEO and chairman of General Electric.
Early on in his career there, he was a chemical engineer, and he accidentally blew up a factory.
When Welch met with a manager to discuss the situation, the manager coached him through the mistake and what he could have done differently.
In the years that followed, Welch treated his own employees the same way.
The first time Jack Welch met his boss' boss' boss, it wasn't to talk about promotion opportunities or about anything impressive he'd done.
It was 1963, and Welch was a chemical engineer at General Electric, the company where he'd eventually become CEO and chairman.
The issue at hand? Welch had inadvertently blown up a factory. Fortunately, no one was killed.
Welch recounted the experience and what it taught him in an interview with Stephen Dubner on the Freakonomics podcast.
After the incident, Welch said, his direct boss "didn't know me. He made sure he got away from me."
Instead, Welch was sent from Pittsfield, Massachusetts, to New York, to meet with the late Charlie Reed. Like Welch, Reed had a Ph.D. in chemical engineering.
As he drove down in his Volkswagen, Welch told Dubner, "I expected I might get fired."
To Welch's surprise, Reed "took me through the Socratic method. You know, 'Why it happened? What would you do differently? Why did you do that? Why didn't you do this?' And he was coaching me, and it was — couldn't be nicer."
The meeting taught Welch an important leadership lesson: "Never kick anybody when they're down. Kick them when they start to swell instead of grow, and whack 'em when that happens."
Writing in Forbes about the same event, Welch said that in the years that followed, he behaved the same way with his own employees and "saw it help more people for the better."
There's no telling how Reed might have reacted if the explosion had been fatal. But Welch's story about Reed's patience and willingness to coach instead of scold recalls another leader's admission that he loves when employees make mistakes.
Joe Schumacher is the CEO of the early education franchise Goddard Systems, Inc., and he previously told Business Insider that when people make mistakes, it means they're being proactive and helping the company grow.
When an employee does make a mistake, Schumacher said, "it can become a learning opportunity for the employee, managers, and executives on how to make the business more efficient, which can provide even greater value."
Listen to the full interview on Freakonomics »
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