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GE Answer

The software down approach taken by IBM and Google focuses on developing general purpose algorithms and AI capabilities that can solve a wide range of industrial machine problems. In contrast, GE's approach is built on its expertise in manufacturing and servicing industrial machines. GE has access to vast data from its installed machine base and deep knowledge of customer needs that it can use to develop and test domain-specific algorithms. Rather than just providing software, GE aims to deliver outcomes by leveraging its end-to-end control over machine design, manufacturing, servicing, and software.

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Thanshali Narzary
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103 views

GE Answer

The software down approach taken by IBM and Google focuses on developing general purpose algorithms and AI capabilities that can solve a wide range of industrial machine problems. In contrast, GE's approach is built on its expertise in manufacturing and servicing industrial machines. GE has access to vast data from its installed machine base and deep knowledge of customer needs that it can use to develop and test domain-specific algorithms. Rather than just providing software, GE aims to deliver outcomes by leveraging its end-to-end control over machine design, manufacturing, servicing, and software.

Uploaded by

Thanshali Narzary
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Shankha’s Question:

In the GE case it's written that "GE’s approach to the industrial Internet was different from other
players such as IBM & Google, which had far deeper analytics expertise and big data capabilities.
These companies approached the opportunity from the software down rather than worrying about
manufacturing & selling. " ( GE case page 18)

What's this software down approach & how is it different from GE's approach?

Response:

IBM, Google and others have deep expertise in Analytics and AI, and are in the forefront of the race
in development of algorithms that can solve multiple problems (remember the general purpose
capability that IBM was trying to build with Watson). These firms believe that their algorithms can
solve a wide range of problems requiring human-like intelligence. Hence these firms approach this
specific problem (of industrial machines and the internet) from the perspective of an algorithm to
solve machine problems.

GE does not have such deep capabilities in AI, Analytics and Big Data. However, they have something
that the AI giants do not have. Let me list down what makes GE a standout in this specific domain:

1. The data generated by the numerous GE machines installed in its client premises – this
allows GE to run and test its algorithms, and see how they behave and whether they
perform the desired objective (“we can test any algorithim, and see how it works”page 5).
No other firm has this dataset, except to some extent Siemens.
2. The installed base of machines that works as a live experiment bed, allowing GE to test its
algorithms. No other firm, particularly the software firms, have the depth and breadth of
such installed base of machines in each of the industry that GE is targeting
3. The trust of its clients, with whom GE has longstanding relationships of having
manufactured and serviced their industrial machines. This will allow GE to experiment with
its software solutions
4. The scale and breadth of GE’s operations (“smart-machine flowers to bloom … not in
isolation, but in aggregate”), in the niche that it is targeting. IBM may have some similar
clients, but they do not have this kind of scale.
5. Understanding and knowledge about this domain – none of the software firms have such
kind of understanding
6. They created a new structural change (GE Software) by bringing in the engineers working in
the different business units, and have them in the new unit (GE Software) dedicated towards
solving a clear problem/s. Not only in software, but they made similar changes in their Sales
& Marketing organisation, to have the right offerings in the market.
7. They adopted their business model, moving from selling “traditional boxes” and servicing
the machines to selling “solutions” targeting customer’s pain points, and promising an
outcome. This will not be possible for any of the software firm, as they have little control, or
knowledge, of the installed assets. GE can do it because they own end to end, from the
design and manufacturing of the machines, to servicing them to promising an outcome,
confident of their machines’ performance, and their algorithms’ predictions and deep
analytics capabilities that they have built on this precise domain.
8. They had the talent from the domain, engineers and technologists who have deep-seated
knowledge and understanding for the kind of problems their customers face. Solving a
problem for those kind of people in GE will be far easier than for a software firm like IBM or
Google, who have far less knowledge and understanding of the domain. [this point is close
to point 5].

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