book.chapter Initial stages

Jack Welch was born on November 19, 1935, in Peabody, Massachusetts, to second-generation Irish-American parents. His father was a lifelong railroad conductor for the Boston & Maine line, and his mother took on the primary role in raising Jack, their only child. After graduating from Salem High School, Jack pursued higher education at the University of Massachusetts at Amherst, attracted by the affordable tuition of fifty dollars per semester. He began his studies in 1953 and graduated in 1957 as one of the top engineering students with a degree in chemical engineering. His academic excellence led him to the University of Illinois at Champaign, where he received a fellowship to join the Ph.D. program. By 1960, Jack had earned his Ph.D. and married Carolyn Osburn. Upon graduation, Jack Welch, at 24, had multiple job offers, but he was particularly intrigued by an opportunity from Dr. Dan Fox at General Electric in Pittsfield, Massachusetts. He was tasked with developing a new thermoplastic called PPO (polyphenylene oxide), which showed great potential. Jack joined GE on October 17, 1960, as an engineer with an annual salary of $10,500. However, within a year, he grew frustrated with the company's bureaucracy and nearly left, but a young executive convinced him to stay by offering a raise, more responsibility, and protection from bureaucratic hurdles. Jack's perseverance paid off when, in 1964, GE invested $10 million in a pilot plant for PPO production, and Jack lobbied to be its general manager. A setback occurred when PPO was found to crack at high temperatures, but after six months of intensive lab work, the problem was solved by blending polystyrene and rubber with PPO, leading to the successful product now known as Noryl, generating over $1 billion in annual sales for GE. By June 1968, Jack's success with the PPO project led to his promotion to general manager of GE's plastics division, a $23 million business. Known for his blunt and candid demeanor, Jack was ambitious and openly aimed to become GE's CEO, a goal he mentioned in his 1973 performance review. His ambition did not hinder his career, and by June 1973, he became the group executive for GE's chemical and metallurgical division, overseeing $2 billion in annual sales, 46,000 employees, and 44 factories across 8 countries. Jack preferred to work from a suite of offices in the Berkshire Hotel in Pittsfield rather than move to GE's corporate headquarters in Fairfield, New York. Despite initial mistakes, he gradually learned to navigate the GE system. In 1977, he became a sector executive and moved to headquarters, where he was in charge of consumer products and services, a new area for him. The CEO succession process was politically charged, but Jack focused on his work, including growing GE Credit Corp., which saw impressive growth rates. By late 1979, the race for CEO had narrowed to three candidates, and Jack, at 44, was one of them. After a detailed assessment of their performance and vision for GE's future, Jack Welch was chosen by Reg Jones to succeed him as CEO, with the official transition set for April 1, 1981.