(FORTUNE Magazine) – Jack Welch bristles whenever he sees himself referred to as Neutron Jack (as in, when he enters a factory the building remains standing but the workers are wiped out). Welch picked up the nickname by cutting more than 100,000 workers from GE's payroll over the last five years. In a wide-ranging interview with FORTUNE's Peter Petre and Margaret A. Elliott, Welch explained why he believes the term unfair, and offered thoughts on managing the nation's largest conglomerate. Excerpts: On being a tough manager: I got a raw deal with all those things about tough-guy Jack -- fear, intimidation, guns and sticks and whips and chains. If you're mean you don't belong at General Electric. Let me tell you why the name Neutron Jack is wrong. Competitiveness means taking action. Nuking somebody means you kill him. We start a renewal process. When people leave our company we provide a soft landing. People who have been removed for not performing may be angry, but not one will say he wasn't treated with dignity. I don't think anyone would say he was treated unfairly, other than that bad management might have messed up the strategy. We can look ourselves in the mirror every morning and say we did what we could. On anxiety among employees left at GE: If you're a middle manager who's not going anywhere, not trained in tomorrow's technology, it's a tough issue, tough all across America. If you look at what we did as a nation and what companies like GE did over the last 25 years, a lot of people didn't stay current as we went from electro-mechanical to electronic technology. A lot of methods changed and a lot of people didn't change with them. If you're a middle manager in General Electric who is pretty well plateaued out, do you like what's happening to you? Probably you're concerned. On GE's failures in factory automation: We picked the right market but we couldn't have executed (the strategy) much worse. I endorsed everything (the factory automation team) did wrong. Somehow or other they got ahead of themselves in their execution. Until we automated our own dishwasher manufacturing we really never knew what it was ourselves. We stumbled and fell and tried this and tried that and then it finally worked. The automation business is doing extremely well and programmable controls have turned out to be a real winner. It won't be a multibillion-dollar business in 1990 (as GE had predicted), but it will be a billion-dollar one making $80 million to $120 million. On his biggest disappointment: The most gut-wrenching thing was being battered in the defense scandal. (GE pleaded guilty last year to overcharging on a government contract in 1980.) It hurt, it hurt a lot. We love this place and somebody was throwing stones at it. We went down a lot of paths (to figure out what happened). It takes a long time because (GE executives involved) come in with arguments about the complexity of government rules and a lot of other things. Then we got to the point where we concluded that someone did cheat, someone did try to beat the system. Until we got to that point we were chasing ourselves around in a circle. But it isn't the government's fault. It's basic integrity. In the end, your integrity is all you've got. On luck: The Lord threw parachutes to a lot of people and they all came down. Some landed in the steel business in 1980, some landed in broadcasting and some in financial services and some in investment banking. Where the parachute drops you is fortuituous, and then you make the best of what you get once you land. On the role of GE's top management: (Vice Chairman) Larry Bossidy knows GE Credit. He built it. I know the plastics business. (Vice Chairman) Ed Hood knows jet engines. After that we start to get into very shallow water. But we know people. We know how to spot good ones more often than we spot bad ones -- we don't bat 1,000 -- and we know how to allocate resources.