The Jack Welch MBA Capstone Program

After witnessing the immediate impact of a business simulation program for some of the world's top executives during his tenure as Chief Learning Officer at General Electric, Steve Kerr knew that such a program would be the perfect capstone to an Executive MBA education.

So when he joined The Jack Welch Management Institute (JWMI) as Dean, Kerr created a revolutionary Business Simulation Capstone project where students would be given the opportunity to run their own company through six quarters of its lifecycle.

Essentially, the Capstone project challenges student "executive" teams to turn around a distressed business by putting the management principles of JWMI founder and former GE CEO Jack Welch and other leading business thinkers into action. As many as three teams compete against each other, using a powerful, interactive platform to host live team meetings, virtually whiteboard ideas, and share collaborative documents. By inputting decisions into a spreadsheet over the course of the program, students see how their choices play out first-hand in a simulated competitive environment.

"In my 70/20/10 rule of learning, experiential learning is the 70," says Kerr. (The 20 percent is learning from others and 10 percent classroom learning.) "One of Jack Welch's principles is to give people information that is immediately useful, so by creating a Capstone project that is all about hands-on learning-by-doing, we are giving our students just that. Why wouldn't you replicate the most powerful part of corporate learning in the classroom?"

As the culmination of an MBA curriculum resolutely focused on providing concepts and tools that are relevant to the real world of business, the Capstone project is an ideal way for students to practice skills learned in coursework. Yet it also gives JWMI students a distinct competitive advantage in the marketplace by preparing them to tackle real corporate problems with effective strategic decisions.

"This is one of the few times a university has turned a true corporate executive development process into a class for graduate students," Kerr elaborates. "Students who successfully complete this final project demonstrate an ability to analyze, interpret, synthesize and communicate the key business principles and practices learned throughout the program, including Jack Welch's proven approach to organizational effectiveness."

Because students inherit a struggling company held by impatient investors, the simulation requires decisive management to achieve a quick turnaround on the balance sheet. Improving cash flow and quarterly profits, however, are insufficient criteria for "winning" in the simulation. The program also demands shrewd long-term planning to make sure each company is positioned for long-term growth.

"The Capstone project simulates the unpredictable nature of the real world," says Rich Avrut, a JWMI course designer who was one of the Capstone project's beta testers. "Having a strong vision for the company is absolutely necessary, but developing a heightened awareness of market changes can also help teams take advantage of information that competitors are missing. It is critical to challenge the assumptions in your business environment if you are going to turn over the right stones and transform your business," he argues.

In the virtual teaming environment of the Capstone project experience, integrating Jack Welch's canon of teachings is also crucial to student success.

"The task of turning a business around within a competitive environment forces vision, mission and value decisions," according to Doug LePelley, a JWMI faculty member who also participated in a beta test of the Capstone project. "In addition, the concepts of winning, and finding and defining a competitive advantage also become major aspects of the class," he notes.

The use of role-play demands that students take on the mindset of various corporate players. Every turnaround simulation requires teams to converse with all the stakeholders in the supply chain, create a robust strategy, and confront organizational transformations that are built into the simulation.

In the process, the Capstone project simulation forces students to practice creating high performance within a virtual team. The intense demands of the simulation provide a unique opportunity for students to realize their leadership skills. By design, teams are presented with excess information and must sort through a myriad of options in order to make complex decisions. As company leaders, Capstone students soon realize the need for team processes that focus their operations. They realize the dynamics at play on their teams and the need to energize their teammates to execute their vision, according to Avrut.

"This is a much needed skill for every 21st century organization, and a tremendous advantage for students attending JWMI," LePelley argues. "We create skills and value-add for our students immediately within their careers. The competitive nature of the simulation provides high impact, high value and forces high engagement within the team."

Another JWMI Capstone project tester, Jason Wood, summed up his experience this way: "The bottom line is that you have the opportunity to put theory into practice. You get to use the skills and education you have gained from your finance, operations, marketing, and other courses. You interact with JWMI faculty, students and external consultants to make quarterly decisions that will help move you ahead of your competition to ensure that your company is the best...but watch out! The JWMI program is made up of "cream-of-the-crop" students that are very competitive by nature. In order to win at this simulation, you will need to be at the top of your game."

"When you are done with this course, you will be ready to put your education and skills into action, and will already have experience managing teams, customers, suppliers, unions, and other day-to-day operational matters that businesses face each day," he added.

Indeed, as they come away from the Capstone Simulation with rich experiential learning under their belts, JWMI graduates can expect to be the better positioned to navigate critical business challenges, lead with confidence, deal with uncertainty, manage change, and ultimately win in the real world within their own organizations and careers.

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