GE's Transformation...Start Small, Start Now
This story originally appeared on LinkedIn.
I constantly stress to my CIOs that they need to start now ... start small, but start now. The obvious question is, how?
I’ve watched our customers transform but I’ve also learned firsthand what it takes to drive change through industrial software. We’ve been remaking ourselves at GE as a digital industrial company and creating our architecture for the future. For me, the paradigm is that we eat our own cooking.
We’ve focused on four key areas in our transformation: cloud, data as a service, manufacturing and field services. Taken together, they drive a powerful combination of better outcomes and higher quality for our customers, and speed and productivity for GE.
Harnessing the cloud
The cloud is all about speed and the ability to take advantage of innovation quickly. By moving to the cloud, applications that used to take months to launch now take minutes. This is critical for GE, since we run thousands of applications in data centers and server rooms. But by 2020, we expect to run 70 percent of our applications in a cloud environment.
By leveraging “as a service” software and infrastructure, we’re moving out of the “manufacturing” business and into the “assembly” business so to speak. Don’t get me wrong – we’ll always have some of our own data centers and what we “assemble” in order to deliver includes a lot of our own production. But we’re thinking more nimbly and more strategically about how to use the entire ecosystem for speed and value.
With the speed of innovation cloud has brought to the market, we never assume that we have to build something ourselves. We evaluate the technology and the financials and make a business decision. This allows us to invest more in the differentiating items we do need to build.
And the cost savings will be significant. By embracing cloud-based solutions, we will significantly reduce our owned and operated data centers. We typically see in the range of 10-40 percent cost reduction as we do it.
Running a digital thread through manufacturing
When it comes to operationalizing the IT/OT convergence, manufacturing is ahead of the game. The key to our approach at GE has been turning our 400 factories into what we call “Brilliant Factories.”
The Brilliant Factory much more tightly (and digitally) integrates engineering and manufacturing design, leverages data to run our factories much more productively and optimizes the entire supply chain in new ways. Embedded sensors provide visibility into how equipment is performing and how to optimize production and material logistics real-time. We can increase machine uptime and predict maintenance before it is needed.
Analytics predict the risk of late delivery by suppliers, so we can adjust the entire production schedule before it creates a problem. These same sensors are used for insight into the physical process to make it better as well as providing the critical data for engineering models.
For example, our Power & Water and Transportation businesses, we’ve seen 10 - 25 percent increases in machine uptime (think productivity).
Data as a service
The whole focus of the Industrial Internet is to drive better outcomes for our customers. Data as a Service is how we drive outcomes from data inside GE.
Wielding our Predix platform and data lake technology, we can harvest large sets of disparate data in ways we never could before, and at cost points that were previously unimaginable.
At the heart of our efforts is an outcomes-first approach: start with the outcome, define the decision process, then drive back into the data. This is not, “if you build it, they will come.” We’ve been laser-focused and it’s yielding results.
By leveraging machine learning and analytical algorithms, we’ve cleansed and analyzed data sets across the entire GE industrial direct materials sourcing buy (all $40 billion worth). We’re driving new levels of transparency and negotiation with our suppliers as a result. And we did it in a few months, not years. Imagine how quickly we can drive acquisition synergies with this capability.
We’re also using Data as a Service to drive new ways of thinking in GE, solving problems in manufacturing, logistics and product quality. And we’re just getting started.
Predictive field service as a productivity driver
Field service is one of the most important places we engage with our customers. For our customers, more machine uptime can mean billions of dollars of productivity in their operations.
We’ve worked with our customers to drive some amazing outcomes. For example, we have a solution called “Smart Outage,” which is a mobile collaboration tool designed for our field engineers in our services businesses. It gives them real-time information, so when they are out on a rig, repairing some big heavy metal equipment, they have a way to connect back and collaborate with an expert.
We’re also leveraging machine data and algorithms to predict how to best maintain and optimize equipment performance for our customers … this means we can fix things before they break and monitor assets remotely and in real-time. And we’re well on our way to making the life of the GE field service engineer a completely mobile, digital experience.
Moving from a reactive to a predictive field service management model is expected to result in significant productivity gains.
In order to drive these outcomes, we needed a modular digital backbone that was connected by a single platform. That’s why we developed Predix. Now we’re connecting people with products and process and seeing growth for our customers and across GE. We work with integrated teams (software, IT, engineering) to bring these outcomes to life.
That’s how we got started. Are you in?
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