Jack Welch may not be asked to add a book on the etiquette of retiring gracefully to his volumes of management writings.
Mr. Welch, the iconic former chief executive officer of General Electric Co. who retired in 2001, was forced to backpedal this week after talking on CNBC about the company's recent earnings miss and the role of current CEO Jeffrey Immelt.
The colourful potshots won harsh criticism in media reports, but Mr. Welch seems to be in no danger of losing his status as a legendary management icon. Yesterday his believers continued to see his comments in the positive light of his continuing attachment to the company, where he was a "lifer" throughout his career.
"I'd be shocked beyond belief, and I'd get a gun out and shoot him if he doesn't make what he promised now," Mr. Welch said of Mr. Immelt in the CNBC interview. "Just deliver the earnings. Tell them you're going to grow 12 per cent and deliver 12 per cent."
He added that Mr. Immelt made a "screw-up" by promising earnings and missing the target three weeks later. "Jeff has a credibility issue," he said.
Although he moved into damage control mode afterward - doing further interviews to say his successor "has a hell of a track record" and that he is "100 per cent supportive" of his leadership - management experts say Mr. Welch risks damaging his reputation by playing armchair quarterback years after his retirement.
"It undermines Immelt, but I think it hurts Jack Welch's credibility as well," said Richard Powers, assistant dean of the Rotman School of Management at the University of Toronto. "Everybody will look at it and say, 'you have no business whatsoever going back in there and commenting.' "
It is undoubtedly difficult for a dedicated former CEO to stop caring deeply about the fate of a company he led for years. In recent weeks, former Federal Reserve Board chief Alan Greenspan has also spoken out in a series of interviews to defend his methods and his legacy with the Fed.
Closer to home, former Loblaw Cos. Ltd. mastermind Richard Currie expressed dismay in an interview in 2006 about the deterioration of the company and a major management shuffle.
Mr. Welch, 72, is a particularly damaging critic, however, because he is a rare former CEO who has retained a high public profile even after his retirement. He has rebranded himself as a management expert, giving frequent speeches and writing a column for BusinessWeek. This profile has helped keep him a popular subject for management thinkers - and gives him a continuing public platform to share his views.
While Mr. Welch is becoming increasingly "historical" as the years pass since his retirement, University of Western Ontario business professor Jeffrey Gandz says he is still widely respected and his methods continue to be analyzed and taught in business schools.
"You cut one of these guys, and they bleed GE," he said. "These are passionate people who are lifers with the company. Jack was a lifer with GE, and he's not going to detach from it easily."
One of Mr. Welch's best-known management strategies is his belief in avoiding surprises, ensuring earnings were steady and predictable. He would not have allowed an earnings miss to shock the market, says Bill Lane, a former speech writer for Mr. Welch who has written a new book, Jacked Up, about his leadership.
"This would not have happened with Welch. He would have smelled it coming, and gotten the word out," Mr. Lane said in an interview.
He added he does not believe Mr. Welch has lost faith in Mr. Immelt, whom he groomed for years as his successor. He says Mr. Welch's criticisms on CNBC were just part of his blunt and emotional personality.
"I think it's irresponsible, but it's a factor in his persona that he is hyperbolic," Mr. Lane said. "Jeff is his creation, and he's disappointed."
Prof. Gandz said he doesn't believe Mr. Welch has done any significant damage with the comments because most people will see them as observations about how others feel, rather than his own personal criticism.
"This is the dark side of mentoring," he said. "You don't necessarily get to pension off your mentor."
Yesterday, Mr. Welch turned his customary candour on himself, acknowledging it looks bad for a former leader to criticize his successor in public.
"Nothing, nothing, nothing is as disgusting to me as some old CEO chirping away about how things aren't as good under the new guy as they were under him," he said. "That's the last thing that I would be involved in."
Past leaders, recent critics
Alan Greenspan
(and Paul Volcker)
From The Daily Show to newspapers and speaking engagements, Alan Greenspan has been everywhere since he handed the reins of the Fed to Ben Bernanke in January, 2006. As Mr. Bernanke was giving a more upbeat assessment of the economy last year, Mr. Greenspan was raising the possibility of a recession. Then came Paul Volcker, the inflation-fighting Fed chairman from 1979 to 1987, who said publicly that the Fed under Mr. Bernanke was working "at the very edge" of its legal authority by bailing out Bear Stearns. Mr. Volcker didn't stop there, openly faulting regulators in Mr. Greenspan's era who allowed the subprime mortgage mess to become "the mother of all crises."
Richard Currie
In September, 2006, former Loblaw Cos. Ltd. president Richard Currie lamented the deterioration of the country's leading supermarket chain, which he helped build over three decades. Mr. Currie, who by then had left the group and was chairman of BCE, said he was baffled by an executive shuffle he believed created a convoluted chain of command at Loblaw, which saw the exit of its president and the creation of a three-man executive team. "I am greatly saddened," he said in an interview. "It's heart breaking, and the question one would have to ask with all these changes is: Why now?"
Rob McEwen
In a case that was somewhat different because of his shareholding in the company, Rob McEwen, founder and former chairman and CEO of Goldcorp, took on the company in 2006 over its takeover of Glamis Gold. Mr. McEwen, who held 1.5 per cent of the stock, launched a court fight to try to force a shareholder vote, objecting to Goldcorp's plan to issue shares to fund the purchase. He was unsuccessful in a high-profile battle that pitted Goldcorp's former chief against the company.
Staff
Janet McFarland