GE polishes global strategy with local transformation

General Electric (GE), founded 125 years ago, is one of the USA's iconic corporations. The firm has 300,000 employees working in areas ranging from aviation, healthcare, transportation, financials, and energy. The firm employs about 5,000 IT staff outside the USA."

Bringing business transformation to a company of this scale is no easy task. But the company is determined to transform from a US-centric company into a global company, so GE introduced a major change last year: siting a critical business unit here in Hong Kong.

Focused on generating growth outside the US, GE set up their Global Growth and Operations (GGO) business unit in Hong Kong last August. The GGO aims to develop business models that are cross-business in nature and globally scalable. To enable this development, the GGO operation supports 13 different regions worldwide.

King Lee, CIO, GE GGO said that his firm's IT strategy is formulated in the US before its implementation in different regions. Often, projects are prioritized based on the majority--and the majority is in the US.

"But when the company is focusing on growth and international markets are growing two to five times faster than the US, the need for IT in these markets far exceeds the US need," said Lee.

The 13 GGO markets include Canada, Latin America, Russia, Germany, Rest of Europe, the Middle East/North Africa/Turkey, the sub-Sahara region, India, China, Korea, Japan, Southeast Asia and Australia/New Zealand.

"The IT teams outside the US used to be very small and distributed," he said. "It's difficult for IT to be an equal partner with business to enable tremendous growth in these regions. We are now scaling up GGO IT to be bigger and bolder, in order to provide capabilities on the ground to facilitate growth."

Avoiding one-size-fits-all

One of the immediate goals for GGO IT, said Lee, is to integrate different IT teams, which used to serve specific GE business, and rebuild them as a cross-business growth-enabler for the region.

"GGO IT focuses on the needs of more than just one particular business's P&L," said Lee. "The unit focuses on needs that cut across all the GE businesses on the ground."

He cited one example: Customs regulations in China--which is different from the rest of the world. Instead of expecting each business to understand the regulations and report to customs independently, a team was established to provide expertise and IT capabilities that help different GE businesses in China.

Meanwhile standardization needs to be implemented carefully. "We are making sure that we don't have the one-size-fits-all mentality," said Lee.

While many companies with global operations implement one ERP model and expect all their other branches to follow suit, Lee said, this approach often creates substantial inefficiency on the ground.

Having the GGO IT team spread across 13 regions allows local IT executives to engage with local businesses and deal with local challenges. At the same time, some of these IT executives are taking up dual roles as regional GGO CIOs to help create the collaboration across businesses and some geographical markets.

One major challenge with the new structure, according to Lee, is to spur the GGO IT teams to take charge and initiate projects for their respective growth markets, instead of waiting for projects rolled out from the US or decisions made from the US. Meanwhile, it is also important to leverage the existing expertise and systems in the US IT team to avoid duplicating work.

"My role [as the GGO Global CIO] is to make sure the collaboration between different IT teams--those in the US, GGO and individual business units--works," said Lee, "by ensuring we are putting the right people in place and identifying key priorities and strategies."

360-degree view of customers

One of the key priorities identified at GE's GGO IT is to develop a company-wide, cross-business and customer-centric BI platform. "We call it Customer 360," he said.

Major customers like State Grid of China are dealing with the multiple businesses units within GE.

The customer could be buying from GE Oil & Gas or GE Power & Water within the GE Energy group. But the customer could also be dealing with GE Transportation for mining or rail locomotives, and GE Capital for financial services.

"In the past, we didn't have a good view of all our relationships and transaction with this customer--our left hand didn't know what our right hand was doing," he said. "It was difficult to provide a comprehensive service to State Grid."

With Customer 360, the system is able to provide P&Ls and sales teams with a customer profile of State Grid that includes information such as historical deals, orders and revenue, and contacts from different departments of the customer's operation.

"With that information, we are powered with intelligence and are able to provide information that the customer themselves may not even know," he said. "This will help strengthen our relationship with the customers on the ground, regionally and globally."

A prototype of Customer 360 is now available--it covers the top 50 global customers, only a year after the GGO IT was established. Lee attributed the short development time to the company's existing master data management (MDM) initiatives, in which many business units have started, but with different maturity levels based on their own P&Ls.

Although individual business groups are pursuing their own journey of building a more integrated BI platform around their customers, GGO IT takes these initiatives to the next level by integrating the platform across business units and groups.

"There were plans to do this, but no specific unit was given that goal, responsibility and authority to roll this out," said Lee. "We [as GGO IT] make sure we won't duplicate the existing initiatives and work closely with IT teams of individual business units."

GGO IT also provides a focus to the initiative, allowing the growth unit--which may have fewer resources and smaller P&Ls--a priority to embark on the journey.

While GE's North Asia and the Middle East and Africa regional operations participate in the pilot project, it's still early to quantify results, said Lee. He noted that Customer 360 is helping these regions identify new opportunities and ideas. Now the firm's top five mining customers are engaging with at least six GE businesses, while the rest are only dealing with two to three services, Lee revealed.

"Why can't we have the rest of the GE businesses dealing with all our customers, just like the top five? This platform is helping us answer this question and generate new ideas," said Lee. "It is not even a technology initiative; it is a business initiative that helps us connect different businesses at GE."

This story, "GE polishes global strategy with local transformation" was originally published by Computerworld Hong Kong.

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