Beth Comstock – GE Vice Chair, Business Innovations
Immelt wants simplification
Simplification, if you hear Jeff Immelt in any form, you can’t talk to him for more than two minutes without him talking about simplification
We want to be more like a startup
So we’ve been on a journey, especially in the past three to five years to be much more agile, faster, speed, to be much more like a startup. Why is that important? Because our customers expect that there is incredible change happening in the marketplace right now, and our customers need to be ready for it and we need to serve them better.
GE ventures partners with startups
One of the levers that we’re using is something we call GE Ventures. It’s partnering with startup. Yes, we’re doing some small amount of equity investing in some of these startups. But equally important is the cultural impact where we’re using partnerships with these startups to round out our offers, to help us get simpler, faster and I’ll give you a couple of examples of these, but to partner for growth.
Bringing more entrepreneurs into GE
The other thing we’ve done is started to bring in more entrepreneurs who are serving in residence for some of GE’s business offerings, our digital offerings that bring in entrepreneurial mindset, if you will, as a coach working with our traditional GE business leaders, and that all wraps up to something we call FastWorks. It really is the cultural mandate. Are we moving faster, are we getting feedback from our customers at an early stage to know whether we’re spending money in the right way.
more companies want to produce power on site
more and more companies, as I mentioned, want to produce power on-site or they want the back up if they need it. They want the resiliency. They want to shift their usage, their utilities are saying especially during peak demand time — they have to scale back on your energy usage right now. They want some ability to control that destiny. Over time storage will become much more of a capability to do that. It’s still early, I’m happy to go into that. But what I’m talking about largely is just demand response. The utility need some help with their commercial and industrial partners, their customers in easing that flow of energy between the commercial and industrial and what the utility needs. We think this is an opportunity for Current.
Example of consultative approach with large box retailer
Finally, what this mean for the customer? How do we unlock value? So, I’m going to take — imagine a large box retailer, we thought it would be helpful to break it down for you. What’s their need, they — in this particular case, they want energy management solution. They really need to get a handle on managing their energy across all of their retail footprint. What we will help them put in place is a hardware, software service network, not all of it comes from GE, but a lot of it starts with GE.
Former GE capital sales people helping in other segments
We’ve used our former GE Capital, many of those sales people to come in and help us. They’re very good at a consultative sell to the CEO or the CFO of a business, so that allows us to call on this new customer base.
So, like we did with solar, I think in the early days of solar we took a position really more in the hardware and with solar we’ve come to appreciate more of the integrated system wrapped in software and capabilities like GE’s inverters, which come out of our power conversion business. It’s a similar look at solar. I think solar is — it’s storage, I can’t — solar is similar to what’s happening in — what happened in — storage is similar to what happened in solar. I can’t speak very well. So, solar is not yet, right, I mean, storage is not yet. Solar is happening, but they follow with similar cost and performance curve is what I’m trying to say. So, we expect storage to really take off in the next five to seven years, customers want it. It gives them the resiliency, the backup that they need to control their destiny. The technology is not there yet, but the cost curve is coming down and the performance is doubling. And in the past five years, you’ve seen the cost curve to go down by 50% and the performance is more than doubled in storage. That mirrors what happened in solar over of a similar period of time. So what we’re doing is, we’re basically playing the role of an integrator, putting the complete system together. The software and the connectivity to Predix and the ability to tap into a broader energy management system, we think is the differentiator. And with storage, right now we’re doing utility, scale applications, some grid scale applications, and ultimately we’ve housed it within Current, we expect to do some at the CNI site. And I — that similar path at solar went on, which is why I can’t say solar for storage.
It’s pretty exciting if you extrapolate that, the culture is changing. It’s about agility, it’s about speed, it’s about understanding that I can offer a service, not just a saying, we had to bring in the right kind of capability. We’ve hired thousands of software developers, artificial intelligence data analytics people, so we’re able to attract the right kind of capabilities
So, I think you should feel comfortable in the next five years. Our projections, we said $15 billion of impact from digital, it’s productivity, it’s sales through Predix, it’s sales of specific offers from digital software. We feel good about that.