The restructuring of GE, which started in late July 2018, continues. In a recent announcement, GE CEO Lawrence Culp announced a new Industrial IoT company, which will create a $1.2 billion business focused on Industrial IoT. The new company will have its own brand, identity, and equity structure but still owned by GE. The independent structure of the company is definitely a good move, as this will allow it to focus on the core markets in the Industrial IoT market.
Those who have been following the news around GE Digital will definitely not be surprised by the comeback itself much but will definitely be surprised to know that many key people, since the retreat, have left the company such as GE Digital’s CEO Bill Ruh & GE’s Chief Digital Officer Ganesh Bell.
After selling 90% stakes to ServiceMax, the new formation will constitute of GE Digital’s Industrial IoT Solutions that includes –
- Predix
- Asset Performance Management
- Automation
- Historian
- Manufacturing Execution System
- Operation Performance Management
- GE Power Digital
- Grid Software Solutions
Obviously, Jeffery Immelt’s, Jack Welch’s successor, plans to make GE a top-10 software company is already dead, but GE does have an opportunity here to incorporate what worked and avert that did not work. It will be interesting to see how the new-yet-to-be-found CEO of GE Digital establishes a new path forward for the company. GE definitely has a lot of ground to cover to catch up from where it left.
- Startups such as C3IoT, Uptake, and other numerous small “IoT platforms” have grown their software clout very rapidly in the industrial market. C3IoT, particularly, has collaborated with all the major cloud platforms and has a presence on HPE.
- Cloud platforms also offer Industrial IoT solutions such as AWS SiteWise & Microsoft Digital Twins & Azure Sphere Secure-edge services. AWS & Microsoft Azure also has the advantage of more IoT developer (approx. 80%) on their side.
- Siemens, Honeywell & IBM’s industrial effort got a lot of boost from GE Digital’s marketing effort and they have capitalized very well on it.
GE’s biggest advantage in the Industrial IoT market is its huge base of Industrial assets such as Jet Engines, Turbines etc. Which makes a good case for Edge Computing & Digital twins that allows GE to monetize the data acquired from these assets. When compared to the other startups, GE holds an upper hand as they have both, industry expertise and the assets. This is also a primary reason why investors are now worried about their investments in the Industrial IoT startups. They don’t want to handhold and mentor these startups, instead, they look for the ones who focus on one sector and has expertise in it.
GE should focus completely on its current product portfolio to offer domain-specific solutions to customers by avoiding time & money investments in building a thick foundation. Instead of reinventing the wheel, it should follow a similar path as C3IoT by collaborating with major cloud tech and reuse what is already there. This way it can focus on the metrics that are of the highest importance to the customers and create good differentiation with the competitors.
