Going Digital: General Electric and its Digital Transformation

In the same way that Millennials seem to adopt the latest digital technology with ease, our economy’s younger companies also display a natural aptitude for the new economy.

However, while the stories of the digital natives are instructive, what about more established corporates with longer histories?

How can a company that is over a century old transform itself to thrive in a digital economy?

For GE, responding to change is part of its modus operandi.

This is a company that has famously made change a core capability and a constant in its history.

For over 120 years, GE has ploughed forward under a banner of “Building, powering, moving and curing the world. Not just imagining. Doing.” This constant focus on innovation and transformation has made the company the only one to still remain in the Dow Jones Industrial Index since the original index was established in 1896.

The Need for Transformation
Over the last century, GE made the bulk of its revenues by selling industrial equipment and maintenance services to its customers.

However, in recent years, it faced increased competition from companies that were not just in the business of selling equipment.

These new competitors used information generated by large machines or equipment to provide services that improved productivity and reduced downtime.

GE realized that this trend had the potential to reduce it to just a commodity equipment provider. CEO Jeff Immelt underlined the importance of this shift, and the need to make drastic changes in GE’s business model, when he said in 2013:

“We know that there will be partnerships between the industrial world and the internet world. And we cannot afford to concede how the data gathered in our industry is used by other companies. We have to be part of that conversation.”