GE 2014 Annual Report Download - page 12

Industrial Internet has the ability to drive
unprecedented gains in productivity
and effi ciency. It will create high-skilled,
high-paying jobs for workers trained in
data analytics and engineering, and could
add $10–$15 trillion to global GDP.
GE can seize this opportunity in a way no
other company can. There are some busi-
nesses that design software, and others that
focus on building and manufacturing. But
GE is the only company that can join innova-
tive technology with industrial depth. That is
important as our customers seek outcomes
that deliver lower unit cost.
We are investing more in enterprise IT to
create a foundation for speed and effi ciency,
essential to win in the Industrial Internet.
We are putting 70% of our applications on
the cloud to improve fl exibility. And, we are
launching game-changing applications
to improve our effi ciency. An example is our
“Brilliant Factory” initiative where we are
unleashing the power of analytics in our
manufacturing plants. In Healthcare, we
already see improvements in yield, sourcing
and uptime; design changes can now be
done in 24 hours instead of three weeks.
We are investing in software and analytics
capability, investments that small compa-
nies or one-dimensional companies cannot
make. GE’s installed base has 10 million sen-
sors and collects 50 million data elements.
By analyzing this data—and combining it
with our deep knowledge of our machines—
we can generate substantial savings for our
customers and GE.
In Aviation, we now collect performance
data for 10 million fl ights; more than
1,500 terabytes of data. This data can be
used to segment fl ight operations and
engine performance, which can allow for
customized maintenance cycles. Across
industry, these small changes in perfor-
mance create big benefi ts in profi tability.
With the Industrial Internet, analytics
become predictive, employees increase pro-
ductivity and machines are self-healing.
To achieve these customer outcomes, we
have attracted world-class talent in data
science, user interface, cybersecurity and
agile development. We have built an analyt-
ics operating system called PredixTM that is
used across the Company. On this, we have
launched 120 apps for asset optimization,
enterprise optimization and internal pro-
ductivity. We call this Predictivity. Our teams
have a Silicon Valley presence and develop
GE has a lean structure. Our administrative
cost is heading toward 12% of sales, below
most of our peers. We run the Company
with small headquarters, common processes
and shared services. Through our Global
Operations, we aim to move 65% of our
processes into shared services at world-
class costs. A key part of our effi ciency
is a common and fl exible IT backbone. The
GE Store drives low cost.
We develop leaders. The cultural backbone
for the GE Store remains our leadership
institute at Crotonville. We invest $1 billion
in learning and development each year, and
we train 40,000 employees in Crotonville
courses each year. Around the world, we
offer “capability building” to countries where
we invest, as an additional benefi t to a
“GE job.” We train customer executives,
invest in schools, develop small business
and bring higher standards. This unique
cultural edge allows us to beat global com-
petitors far from home.
We will leverage all of the GE Store as we
embrace the Alstom acquisition. Alstom is a
big bet for the Company, and complicated
as well. Alstom has a similar customer base,
but different technologies; and we are
making the investment at the right point in
the cycle. The synergies are straightforward
and within our capability to execute. Just
by bringing the Alstom businesses to GE’s
operating standards, we will create billions
of dollars in value. Between GE and Alstom,
there are more than $1 billion of sourcing
opportunities on components one of us
currently manufactures. GE can add global
service, project fi nance and technology;
all from the GE Store.
Big Iron + Big Data = Big Outcomes
The most important addition to the GE Store
remains our expertise in building the con-
nective tissue of 21st century infrastructure.
Today, GE is leading the way toward an
age of brilliant machines that can harness
reams of data to deliver transformative
progress for people and businesses around
the world. This is the most important initia-
tive I have led at GE.
We call this the Industrial Internet and
are convinced that there are few limits to
its potential. Economists believe that the
The GE Beliefs drive the performance of the Company
and the actions of our people.
EMPOWER &
INSPIRE EACH
OTHER
LEARN &
ADAPT
TO WIN
CUSTOMERS
DETERMINE
OUR SUCCESS
STAY
LEAN TO
GO FAST
LETTER TO SHAREOWNERS
DELIVER
RESULTS IN AN
UNCERTAIN
WORLD
10 GE 2014 ANNUAL REPORT