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Jack Welch: The CHRO is equal to the CFO (if not more important)

Feb 4, 2013

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Jack Welch, former CEO of General Electric (GE) and popular leadership author, believes that the Chief Human Resources Officer (CHRO) is at least as important as the CFO — and in his opinion, often much more.In this valuable 2005 video, Jack chats to Robert Joss of the Stanford School of Business about his book 'Winning' before a packed auditorium of MBAs. He takes a few minutes to emphasise the fundamental role of HR and the importance of building a winning team using a sports analogy.

  • The full video runs more than 60 min.
  • For the section on HR, skip to 13 min 15 sec.

Robert Joss: "You say something in the book that didn't shock me, but it may shock a lot of people, and that is, you said, the Chief Human Resources Officer (CHRO) is at least, if not more important than the Chief Financial Officer (CFO)."

Jack Welch: "And I'll tell you, we're not even close on where we have to be in this area. I was giving a talk in Mexico in front of 5,000 HR people and I asked a question to the audience: raise your hand if you're perceived by the organisation to have a seat at the table equal to the CFO. I didn't get 50 hands. Now, if I asked that question in GE, there isn't one HR person that wouldn't raise their hand. Every one of them knows they're equal to or more important than someone counting the numbers.

I always like to use the analogy if you were coaching a baseball team, or a football team, would you want to hang around with the team accountant or the head of player personnel? If you wanted to build a great team? The accountant can't do a damn thing for you, except to tell you how much money you have left to offer to Barry Bonds or anybody else. But he can't do much else. The idea that CEOs hang around with the CFO — the grunt, the guy with the green eye shade — is crazy. The HR person is the person that most companies make the picnics… newspaper… dental plans… fill out the forms… people, but if they use them right and they build seasoned executives into these jobs, they'll be an enormous aid to building great teams.

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… and so there's an enormous need to have these HR people be upgraded; be the stars of the organisation… by taking people that are in line manager jobs and having them grow there. I'm convinced that the reason why HR is not perceived as a very important function in companies is that everybody thinks they're HR experts. How many of you don't think you're a people person? Okay. I mean, everybody thinks they are. 'Who needs a helper?' is the view. "

Topics: Human Resources

Theo Winter

Theo Winter

Client Services Manager, Writer & Researcher. Theo is one of the youngest professionals in the world to earn an accreditation in TTI Success Insight's suite of psychometric assessments. For more than a decade, he worked with hundreds of HR, L&D and OD professionals and consultants to improve engagement, performance and emotional intelligence of leaders and their teams. He authored the book "40 Must-Know Business Models for People Leaders."

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