Engineering giant GE sees its future in IT

US engineering giant GE plans to invest heavily in software, analytics and communications technologies to improve the performance of its industrial and electrical equipment.

Speaking at its Minds and Machines conference in Silicon Valley yesterday, GE CEO Jeffrey Immelt revealed that the company plans to invest as much as $100 million in start-ups, in order to gain early access to IT-related innovations.

GE recently opened a research and development centre in San Ramon, near San Francisco. Immelt said yesterday that it may grow staffing at the centre, which is lead by a former Cisco executive, to 1,000.

It also announced a joint venture with IT services giant Accenture to help analyse sensor data from its machines to offer customers real-time performance and maintenance information.

Earlier this week GE announced a $1 billion plan to invest in what it calls the "Industrial Internet", the application of machine-to-machine (M2M) communications and analytics to industrial systems.

"The melding of the global industrial system that was made possible as a result of the Industrial Revolution, with the open computing and communication systems developed as part of the Internet Revolution, opens up new frontiers to accelerate productivity, reduce inefficiency and waste, and enhance the human work experience," it said in a report.

The report claims that aviation, power, healthcare, rail, and oil and gas, could save a combined $270 billion over the next 15 years by improving efficiency by just 1%. 

According to Reuters, Immelt said yesterday that software has the potential to disrupt many areas of industry, including the power and electricity distribution grid. "The grid has tremendous opportunities for application of both software and analytics," he said. "And we’re better off being paranoid about that."

"In an industrial company, avoid software at your own peril," he said.

Last year, GE announced plans to cut its use of IT outsourcing. “About 50% of the IT work was being done by non-GE employees,” said CIO Cherlene Begley at the time. “That strategy may have had its time, but there was a lot of downside. We lost a lot of the technical capabilities that we have to own.”

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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