# kaal:claim:3411897-005

**Claim.** General Electric's decentralization under Jack Welch worked because each business unit was made fully accountable through its own profit and loss statement and market price internal transactions, which removed inefficiencies and drove up market value.

**Type.** empirical  **Support.** asserted

**Holds when.**

- pre and post internet era corporate reorganization
- no new technological innovation required

**Source quote.**

> Welch's method enabled each business unit to be run efficiently and profitably, while allowing unit heads significant flexibility and independence. GE's market value skyrocketed as a result of its decentralization of business units.

**From.** Wulf A. Kaal, *Decentralization - Past, Present, and Future* (2019), Part I: The Past, Types of Decentralization, page 8

**Cite as.** Wulf A. Kaal, Decentralization - Past, Present, and Future (2019). SSRN: https://ssrn.com/abstract=3411897

**Verify.** sha256 of source PDF `82f0aea026b3e3a526ec51bc073b3b864dc06cd9083ff9c54c550037045edaa9` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202019%20-%20Decentralization%20-%20Past%2C%20Present%2C%20and%20Future.pdf

**Topics.** decentralization, institutional-design, governance-design, corporate-governance

**Keywords.** organizational-decentralization, accountability, corporate-governance, general-electric

**Related claims.**

- extended_by: https://wulfkaal.github.io/claims/3808852-012

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.