Las Vegas: American companies came in for sharp criticism from management expert Jack Welch for their ‘knee-jerk reactions’ in indulging in ‘blanket layoffs’ in the wake of the financial meltdown in that country.
Welch, a former CEO of General Electric, made these comments in the aftermath of the announcement by financial services major Citigroup to shed 52,000 jobs.
“Blanket layoffs are the worst. It is a classic case of a knee-jerk reaction,” Welch said in his keynote address at at a three-day event organised by IT solutions provider CA.
Welch said that he expected the global economy to bounce back by end-2009. He, however, did not give any reasons.
“The US would come out of its present financial turmoil and that would happen if it seizes opportunities in crisis,” he said.
“This is the time to do it. It is much harder to raise money,” he added.
There was a need to modify existing rules but he cautioned against going in for extreme regulations, as was done in the post-Enron scenario.
Welch, a supporter of globalisation, praised India in his interaction. “India is a miracle where countless entrepreneurs are constantly innovating and that has brought the ‘have-nots’ into the ‘haves’ league,” he said.
“The India story is remarkable. This is what globalisation can achieve,” Welch said.
He criticised the outgoing US President George W. Bush for the present global economic meltdown.
He had, however, supported Bush’s run for the US presidency eight years ago.
Now Welch is hedging his bets on President-elect Barack Obama. “He might bring in White House policy correctives,” he said.
“The next opportunities in technology would come in energy,” he said.
“Energy is the next frontier of innovation. It is the Silicon Valley of the next 10 years,” he said.