'The Man Who Broke Capitalism'

The Man Who Broke Capitalism: How Jack Welch Gutted the Heartland and Crushed the Soul of Corporate America—and How to Undo His Legacy, David Gelles (3.5)

Tough book to read: depressing, disappointing with quite a bit of hyperbole. In the beginning, I was put off by the simplicity of ‘Jack Welch ruined everything’, but I’ll admit that Gelles does a good job at laying much of the blame at Welch and his protégés’ feet. He did more damage to GE than I realized at the time – particularly with the emergence of GE Capital and the focus on financial businesses and away from manufacturing. One big surprise for me was the M&A strategy of GE. I participated in the M&A process at Allied Signal under Larry Bossidy and we were required to justify thoroughly how our targets fit into our Business Unit and company strategy. Gelles’ assertion that GE was buying businesses that didn’t fit their BU’s strategy seemed odd. There were other assertions about companies and people I had met that were a little off (i.e. the Allied Signal/Honeywell merger had a lot of issues due to large culture differences, not stress over a possible GE takeover). Overall, I agree with many of his points and am glad to see the shift from shareholder value to the more important, and inclusive, stakeholder value. I’d say the book leans a little too heavy to one side, but eventually gets to the important points.