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Transforming GE through Industrial Internet
GE And Industrial Internet
GE, formed in 1892 by Thomas Alva Edison, had grown over the years into a large industrial conglomerate with interests in diverse businesses such as aviation, power, rail, healthcare, and oil & gas with revenues of US$ 147.669 billion for the financial year ended 2013 (Refer to Exhibit I for GE’s five-year financial summary). GE recorded revenues of US$ 800 million from its ‘Industrial Internet’ segment for the same period. The history of the Industrial Internet at GE could be traced back to 2004 when the company stood as one of the most valuable companies in the world. However, it was not as big as Apple, Microsoft, or Google. Immelt realized that the success of most of these companies was attributable to software, an area where GE did not have a huge presence. |
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Several internal surveys conducted in GE found that it sold US$ 4 billion worth of industrial software every year, used for monitoring wind turbines and running pumps. This was in contrast to the billions of dollars made by other companies. To add to its troubles, companies such as IBM were developing software that could discover why machines such as gas turbines failed by simply studying raw feeds from vibration motors or gauges. Considering that it sold industrial equipment worth US$ 60 billion a year, GE had not focused on these applications as a niche.
