[erichurkman]

To read that quote differently:

1981 • Jack Welch becomes CEO • $1.29 2001 • Jack Welch retires • $37.20 (down from its peak of near $60.00 in mid 2000) 2020 • Nearly 20 years post Jack Welch • $6.28.

20 years of Jack Welch - +2,800% increase 20 years after Jack Welch - -83% decrease

[0zymandias]

2800% is a much bigger number than 83%. But if you do the math using your numbers, you see that GE substantially underperformed the S&P since 1981:

GE = (1+2800%)*(1-83%) = 4.93 = 393% appreciation since 1981.

S&P = S&P has appreciated 2000% since 1981.

GE << S&P

[ivalm]

To be fair, most companies underperform s&p 500. S&p is driven by giant winners, and every generation has different winners. In the 90s GE was the winner and other companies in s&p trailed them. This is what makes survivors like Microsoft so amazing, they managed to remain on top by reinventing themselves many times under different leaderships.

[erichurkman]

Maybe that's why Welch said to measure against GE's future leaders if they are destined to forever underperform the S&P. :)