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Digital Transformation Journey of General Electric

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Digital Transformation has been the new trend in the industrial arena since the advent of IIoT and the fourth Industrial Revolution. Restructuring the present industry, to fit the needs of the Industry 4.0, to increase the Productivity and Operational efficiencies, is called as Digital Transformation. This is a step by step process and the initiation should start from outside of the core business and then gradually pave in. Else, it’s a failure.

General Electric, one of the pioneer companies that established the concept of Digital Transformation, promised to deliver extensive applications for the purpose of Industrial IoT. The firm created the buzz for this, in reference to Predix, GE software for IIoT and the very next year in 2014, GE announced a turnover of more than 1 Billion!

Fatal negotiations:

Metaphorically quoting, “Too many cooks spoil the broth!” GE is a parent organisation for number of sister concerns like GE Aviation, GE Transportation and GE Power. All of these organisations needed the IT transformation and for this, GE catered itself with the GE Digital. But instead of restructuring the industries as far as the digital transformation is concerned, they shove GE Digital. Rather than Digital Transformation, it is considered as Digital enablement. What actually resulted were the billings that showed good numbers to the public, came from the business units of GE itself. This was one major loophole that the top executives could have taken care of long before the negations started proving to be fatal. This story is in much sync with the famous HBO series Silicon Valley.  Where, Hooli, a company, starts developing some other trendy thing and fails not just at it!

GE Digital also started catering to non-industrial organisations trying to help it’s own digital transformation. Soon it started providing consulting services and the main goal did not hold value for the firm and it reportedly had mixed return on investment.

“Quicksand” of product:

Generating long term revenue and a value base to the end users of a service that you build is always a must. GE failed in doing that as well. Predix was supposed to be a full-fledged development platform for third party developers. Instead, the paid partners of GE started using it. For an industry of the size of GE, all these are inimical and should be taken care of before the product is all set to launch. Building software on a quicksand like Predix is a sure failure of the product indeed.

GE has now shut down certain hardware sales and is restricted only to pure software sales. The very hard-working team at GE took bold steps and had the guts for trying new things, but unfortunately very few had power for influencing the how GE Digital had been setup. This obvious influence for the current outcome of GE Digital could have been better, had there been different setup.

It’s never too late to take off! Now GE needs to structure its business strategically and there is nothing stopping it from massive success!

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