1: The year was 1993. GE CEO Jack Welch was in Japan when he heard a story about the country’s railway system.
After World War II, Japan’s economy had been decimated.
“A large portion of the country’s population lived in or between the cities of Tokyo and Osaka, which were separated by just 320 miles of train track,” Charles Duhigg writes in Smarter Faster Better: The Transformative Power of Real Productivity.
“Every day, tens of thousands of people traveled between the cities. Vast amounts of raw industrial materials were transported on those rail lines.”
Traveling between the cities could take as long as twenty hours because of Japan’s mountains.
“So, in 1955,” Charles notes, “the head of the Japanese railway system issued a challenge to the nation’s finest engineers: Invent a faster train.”
The team spent six months on the project and came up with a prototype engine that could reach 65 miles per hour, making it one of the fastest passenger trains in the world at the time.
“Not good enough,” said the head of the railway system.
“He wanted 120 miles per hour,” Charles notes.
The engineers responded with disbelief. “At those speeds, if a train turned too sharply, the centrifugal force would derail the cars,” they explained. “Seventy miles an hour was more realistic—perhaps 75. Any faster and the trains would crash.”
“Why do the trains need to turn?” the railway chief asked.
“Because there are numerous mountains between the cities,” the engineers replied.
“Why not make tunnels, then?” the chief asked.
For a moment the engineers were speechless.
“The labor required to tunnel through that much territory could equal the cost of rebuilding Tokyo after World War II,” they responded.
The team returned to work and, three months later, showed a new design for a locomotive that could go 75 miles per hour.
“The railway chief lambasted the designs,” Charles writes.
“Seventy-five miles per hour had no chance of transforming the nation,” he said. “Incremental improvements would only yield incremental economic growth. The only way to overhaul the nation’s transportation system was to rebuild every aspect of how trains functioned.”
He wasn’t asking the engineers to make the existing train faster. He was challenging them to rethink what a train could be.
2: The engineers went back to the lab. Over the next two years, they ran countless experiments.
“They designed train cars that each had their own motors,” Charles shares. “They rebuilt gears so they meshed with less friction.
“They discovered that their new cars were too heavy for Japan’s existing tracks, and so they reinforced the rails, which had the added bonus of increasing stability, which added another half mile per hour to cars’ speed.
“There were hundreds of innovations, large and small,” he notes, “that each made the trains a little bit faster than before.”
The audacious goal forced them to rethink everything. But ultimately, they achieved it through hundreds of individual improvements.
In 1964, the world’s first bullet train, the Tōkaidō Shinkansen, left Tokyo for Osaka. The tracks cut through Japan’s mountains, and the train made the trip in under four hours.
Top speed? 120 miles per hour.
“Hundreds of spectators had waited overnight to see the train arrive in Osaka,” Charles shares. “Soon other bullet trains were running to other Japanese cities, helping fuel a dizzying economic expansion. The development of the bullet train, according to a 2014 study, was critical in spurring Japan’s growth well into the 1980s.”
But the story didn’t end there. Over the next ten years, Japan’s railroad innovations inspired high-speed rail projects in France, Germany, and Australia.
3: For Jack Welch, the story changed how he thought about setting goals.
When he returned to the U.S., he spoke with Steve Kerr, a GE consultant and former dean of faculty at the University of Southern California business school.
Jack gave Steve a new charge: GE needed to start setting goals that initially seemed beyond reach.
“Going forward,” Charles writes, “every executive and department, in addition to delivering specific and achievable and timely objectives, would also have to identify a stretch goal—an aim so ambitious that managers couldn’t describe, at least initially, how they would achieve it.
Jack called it “bullet train thinking.”
In his 1993 letter to shareholders, Jack wrote that “stretch is a concept that would have produced smirks, if not laughter, in the GE of three or four years ago, because it essentially means using dreams to set business targets—with no real idea of how to get there.
“If you do know how to get there,” Jack wrote, “it’s not a stretch target.”
More tomorrow!
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Reflection: Think about one of your biggest goals. Do you already know exactly how you’re going to achieve it? If so, is it really stretching your thinking?
Action: Choose one important area of your life or work and imagine a result so ambitious that you don’t yet know how you would achieve it. Don’t solve it yet. Start by asking what might be possible.