Knowledge @ Wharton recently interviewed Johnson & Johnson’s CEO William Weldon. Weldon made the comments at a Wharton School leadership conference and a video and transcript of his comments is available here.
I’ve always admired J&J’s approach to leadership development. Because of their highly decentralized structure consisting of over 200 operating companies, they have the ability to leverage job assignments for development. Here’s a quote from Weldon on this topic:
“I think the other thing that decentralization does is that it gives you a tremendous opportunity to develop people. You give them a lot of opportunity to work in different areas, to work in smaller companies, to make mistakes and to ultimately move to larger companies. I also think that the benefit of the cultural side that you asked about is that you do have local people running the businesses. The men and women who run our businesses around the world usually are people who grew up in those markets, understand those markets and develop themselves in those markets. They can relate to the needs of the customer, whoever that customer may be.
The challenge really… I see it as a great benefit, rather than a challenge. This is because the problem with centralization is if one person makes one mistake, it can cripple the whole organization. This way, you’ve got wonderful people running businesses. You have to have confidence in them, but you let them run it — and you don’t have to worry about making that one big mistake.”
Here’s the full 17 minute video: