Is GE a Techno-turing firm?

GE, a multi-billion conglomerate, makes revenue worth $4 billion from its software services. And you thought it was an engineering technology company? Yes, it is a manufacturing company, going by the Wikipedia description, GE is into Energy, Capital Finance as well as Consumer and Industrial products. So, where does Technology fit in for a manufacturing firm? Leave alone the $4 billion annual revenue from software, GE is plowing another $1 billion to take GE to a state where IT not only enables its core business but where it transforms the way their business is done.

But has GE always been technology focused? How mature are its technology systems? Is the software GE has been selling/using transformational in nature? Where does GE stand today when it comes to the capability of other softwares in the market? GE, being a heavy weight conglomerate has done a decent job in the technology sphere, but in the end its a dinosaur, a huge one. A slow moving animal, with a lot of drag and a lot of catching up to be done in terms of technology.  There was a time (a decade ago), when GE was the most valuable company on the planet. Luckily for GE then, “software companies” were not the blue whales in the ocean as only a few software based fishes existed. Whereas today, most of the 10 most valuable companies(7/10) are technology companies.

Until recently GE has been using software majorly to monitor the installed turbines, engineGEs and pumps, and to keep a track of their health with a range of reactive solutions in case the software identifies a problem. It was only when companies such as IBM started offering predictive solutions by just gathering data from the hundreds of sensors already installed in the GE engines and turbines, that GE was on its toes. These softwares could predict when the turbine would fail based on analytics and data mining techniques. It was this threat of an intermediary(IT services), that undermined the value of GE’s software services. It was a threat GE couldn’t have ignored owing to the fact that a large chunk of its revenue comes from “Services”(refer to the figure below).

As a result GE launched a campaign called “Industrial Internet” in the year 2012. In a blink, GE has become much more Tech savvy than it used to be. Think of a technology jargon – Big Data, Hadoop, Analytics, Predictive algorithms, GE have a system in place for all. Can you imagine GE launching an algorithm optimization competition on Kaggle? No, need to trouble your creative quotient anymore!

Of course GE doesn’t plan to take on Google, Facebook or Apple, nor does it dream to change its focus from manufacturing to pure technology. But GE is also not alien to the technology buzzword “IoT” (Internet of Things). Why restrict to connecting your mobile to your car, your TV to your watch, your Air Conditioner to your body? GE, through its $1 billion investment, plans to take the same concept to the mammoth structures called Wind Turbines. It plans to create a network of highly sophisticated engines working in tandem with the wind. Think of more than 50 turbines communicating to make sure they extract the maximum out of the wind at that moment. Think of doomed flights being cancelled because GE’s software could detect the possibility of  a mid-air engine failure beforehand.

This is just the beginning, manufacturing could be a completely different ball game in a few years from now. It might be difficult to make out a difference between a pure technology company and a manufacturing firm. How about a technology firm acquiring a big manufacturing firm in the future? Or maybe a scenario wherein all manufacturing machines are replaced by 3-D printers? With a mach-3 pace of technological developments and super mature computer vision and artificial intelligence systems, “Impossible is Nothing” is bound to be the right answer.

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