By Larry Schuster
Storytelling is a highly effective, precise tool to energize teams, refocus and revitalize demoralized companies, envision the future and create winning environments. It also gives life to abstract values and mission statements, and helps business speakers engage their audiences and more clearly frame their presentations.
Jack Welch Storytelling Tool
But like any tool, the question is how to use it, under what circumstances to solve what problem or challenge or further enhance the efforts of a great team.
In 1981, in his first year as CEO of General Electric, on a field visit to GE’s nuclear reactor business in San Jose, Jack Welch faced leaders of that business unit who resisted change.
The leadership of the business projected a bright outlook for reactor sales based on healthy sales for the 1970s. The leaders projected sales of three new reactors per year, as told in Welch’s book “Jack: Straight from the Gut,” and retold in “Lead with a Story”.
Looking back to the 1970s, the projections seemed reasonable, Welch recalled. That business unit had sold three or four reactors each year in that period. But two years prior to his visit, the US experienced a major disaster at a nuclear power plant in Three Mile Island, Pennsylvania. The public’s already cautious appetite for more nuclear power plants vanished. The company had not sold a single nuclear power plant in the two years since the accident.
Delivering The Shock
After listening politely, he shocked the leadership.
“Guys, you are not going to get three orders a year. In my opinion, you’ll never get another order for a nuclear reactor in the US. Instead, he said they should focus their business on selling nuclear fuel and services to the 72 active reactors they already built
The leaders argued if they removed orders from the plan it would kill morale, and they’d never be able to mobilize the business again when orders come back.
Welch was unfazed. GE re-staffed the business to focus on the service model he proposed. Earnings grew from US$14 million to US$116 million in just two years. And by the time he retired 20 years later, the company still had not received even one more order for a nuclear reactor.
In his career at GE, Welch retold this story numerous times when he needed to get his leaders to face reality. Getting people to accept change is the first obstacle to change.
For your company
In your organizations, when your team faces change, you may consider retelling this story to prepare your audience before delivering your own reality check on the need for change.
“GE never did get another order for a nuclear reactor. And the reality for us is, we cannot face another year of uncertain government support (or whatever is your situation).