Also: Markets latest, U.K. jobs, and Chinese surveillance.
Good morning.
I recently mentioned David Gelles’ new book reappraising the career of Jack Welch and demoting him from “Manager of the Century”—a title Fortune bestowed in 2001—to “The Man Who Broke Capitalism” (the title of the book). He argues Welch championed quarterly earnings management, frequent layoffs, financialization, and other evils of 20th century business.
This morning comes a defense from a most unlikely source: his successor, Jeff Immelt. Unlikely, because Immelt took an uncomfortable beating when he was running GE, both from investors—who watched their investment plummet by 30% during his reign, and more since—and from Welch himself, who was withering in his criticism of Immelt in private, and sometimes in public.
In a LinkedIn post this morning, titled “Jack Was Pretty Damn Good,” Immelt had this to say:
“Few people received more criticism from Jack than I did. That is why I feel uniquely qualified to defend him.
“Jack invested in leadership. He was a good coach…demanding and fair. GE produced a lot of good leaders. But the requirements for business leadership in the 2000s (and today) are vastly different than the 1990s and the needs of each company was unique. For example, outsourcing—a common practice for decades—is viewed unfavorably in a world of intense competition for jobs, protectionism and broken supply chains.
“Importantly, each leader was responsible for his or her own success, and many GE alums flourished: Margaret Keane at Synchrony, Scott Donnelly at Textron, Dave Calhoun at Boeing, Greg Lucier at Life Technologies, Dave Cote at Honeywell, Omar Ishrak at Medtronic, Frank Blake at The Home Depot, David Zaslav at Warner Bros. Discovery, Mark Begor at Equifax, Tom Gentile at Spirit AeroSystems, George Oliver at Johnson Controls, Joe Hogan at Align, Lorenzo Simonelli at Baker Hughes, Raphael Santana at Wabtec, Pramod Bhasin at Genpact, Kevin Sharer at Amgen, and Marijn Dekkers at Bayer AG…to name a few. Those who did best combined GE process skills with a passion for technology.”
GE cryptologists will note this exhaustive list excludes the two men who were in competition with Immelt for the top job—Robert Nardelli, who went on to run Home Depot and Chrysler, and James McNerney, who ran 3M and Boeing. In any case, it is a reminder that whatever else you say about him, Jack Welch had an outsized impact on a whole generation of leaders. But it’s also true that each of those leaders was a product of his or her times, and ended up with a very different leadership style from the man who launched them.
By the way, if you missed our interview with Jeff Immelt on Leadership Next, you can listen here (Apple/Spotify), or read Geoff Colvin’s classic story, What the Hell Happened at GE, here. I only wish we could bring back the late Welch to give us his unvarnished view of Gelles’ book. (His views were usually unvarnished.)
More news below. And read why one market guru argues that a recession is already baked into stock prices.
Alan Murray
@alansmurray
alan.murray@fortune.com
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Markets latest
Following yesterday's carnage (Nasdaq down 4.7%, DJIA down 2.8%), Asian and European markets have largely continued to slide but less dramatically, and U.S. futures are looking very mildly positive. Fortune
U.K. jobs
Newly-released U.K. jobs data shows record numbers of full-time employees and of unfilled posts, plus redundancies at record lows. It seems some of those who left the workforce when the pandemic struck are now coming back. However, there's been the biggest drop in real pay in over two decades, pointing to a worsening of the cost-of-living crisis, and a big rise in the numbers of those who cannot work due to ill health. Financial Times
Chinese surveillance
The Chinese city of Zhengzhou, a hub for iPhone production, has allegedly started COVID health-code apps to track potential protestors and limit their movements. This is exactly what privacy advocates most feared when such apps were rolled out in authoritarian states, and there’s a massive backlash over the likely fallout for public support for anti-COVID measures. (Bonus read: Michelle Bachelet is stepping down as the U.N.’s human rights chief, following heavy Western criticism that she was too deferential to China over its treatment of the Uyghur minority in Xinjiang province.) Bloomberg
Lightyear bans
Disney/Pixar’s Lightyear, an origin story for the Toy Story character Buzz Lightyear, has been banned in 14 Middle Eastern and Asian countries (and may be banned in China) because it shows a lesbian kiss. Disney says it has no intention of editing out the offending-to-some scene. Sky News
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Driving a sustainable technology agenda How can technology leaders use their organization’s sustainability priorities as a lens for making strategic choices for data, infrastructure, and emerging technologies? Deloitte explores how CIOs can drive transformation and impact their organization’s carbon footprint. Learn More
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Last mile
Electric Last Mile Solutions, a Michigan-based electric vehicle assembler that went public via a SPAC a year ago, collapsed over the weekend. It’s unlikely to be the last SPAC-happy EV firm to go under. Fortune
Celsius fallout
If the stricken crypto lender Celsius does go under, its users will probably never see their money again. It’s right there in the terms of use. Fortune
A.I. controversy
Fortune’s Jeremy Kahn examines the saga of Google A.I. engineer Blake Lemoine, who decided a chatbot he was working on had become sentient and—when his bosses demurred—took their conversation transcripts to the public, leading to his suspension. As Kahn notes, A.I. experts are pretty much united: “The chatbot, which Google calls LaMDA, is not sentient, they said. It cannot feel (which is the definition of sentience). It does not have thoughts. It does not have a sense of self.” Fortune
Inflation causes
Moody’s chief economist Mark Zandi reckons Russia’s invasion of Ukraine, and the sanctions that followed, are the primary culprit for current U.S. inflation, which is running at 8.6%. The pandemic and housing shortage are next on the list. Fortune
This edition of CEO Daily was edited by David Meyer.
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