How He Rewarded His People
Welch had a unique program in place at General Electric (GE) which did a lot to encourage his people.
As a matter of fact you could be rewarded without even being promoted by your base salary being increased by up to 25 percent a year. Cash bonuses were allowed to increase up to 150 percent a year, to between 20 percent and 70 percent of a workers base pay.
For stock options, they were expanded under Welch to reach beyond senior management alone. Eventually many people outside of senior management 
received options that became worth over $1 million.
What was unique in the dispersal of options was that they weren't handed out as automatic annual grants. Welch didn't want the program to be thought of as a "dental plan."
So what he did was insist that a minimum of 25 percent of workers that received options were getting them for the first time. No more than 50 percent of executives receiving them could get them for more than the grants for three years in a row.
This was highly motivating for those coming up in the ranks, and a message sent to those that had been around awhile that nothing was set in stone, and you had to earn your rewards not receive them for tenure alone.
It was a great system put in place that still allowed it to include spontaneity and longevity for those that excelled through great effort. Those coming up knew that there was room for them at the table, while someone sitting around performing at lower levels wouldn't receive what they deserved for their hard work, simply because they had been there for a long time.
At the same time, those that continuted to work and perform great for the company also knew that they wouldn't be neglected just to give those coming up a chance at the goods. Everyone was a winner in it. The company performance continued to show that Welch was right again in how he did it.
Other Jack Welch Resources:
Jack Welch's advice to MIT Sloan students
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