Adjustments for digital automation platform
Commentary: GE Predix business focus changes to meet market strength as other cloud-based industrial platforms gain footing.
The business strategies of GE Predix are adjusting as the management level of GE has changed, with Jeffrey Immelt stepping down as CEO and John Flannery becoming the new CEO in August 2017. With the change, GE would emphasize sales to customers in business fields of energy, aviation, and oil gas and would pay less attention to new customers in other fields. It was apparently a conservative strategy. Allegedly, the primary consideration was to cut costs so as to cope with pressure to improve shareholder returns.
Focus in areas of strength
Besides pressure from cost cutting, adjusting the GE Predix and GE Digital businesses seems to focus on traditional areas of GE strength: energy, aviation, oil and gas, as well as transportation and medical devices. In addition to a profound understanding of these industries, installed base of equipment is tremendous. Hardware equipment provided by GE in these fields, such as aircraft engines, combustion turbines, and other turbines, is expensive and used in critical applications. GE Predix’s expansion in these areas makes sense. Asset management has been the primary field for mature applications of Industrial Internet of Things (IIoT) technologies. Performance management for such assets remains crucial to decrease and hopefully avoid unplanned shutdowns.
Industrial equipment in many applications often is less critical, and, more importantly, GE has little marketshare and installed-base advantages in general industrial markets. For non-GE customers interested in analysis platforms based on the industrial cloud, convincing them to choose GE Predix may be difficult at present.
IT experts seem emphasized
Moving from a global outlook to China’s use of GE Predix, it seems a considerable number of newly hired posts of GE Digital come from companies with IT background, based on communications with the GE Digital China team. Internet expertise seems to have greater emphasis than industrial knowledge among these new hires.
As for the current state of cloud technology in Chinese market, in commercial fields, users accept relevant cloud applications. However, in industrial fields, users’ attitude towards cloud technology is conservative.
The adjustment of GE Predix to current market demands seems a sound strategy for GE’s long-term business health. With the recent maturity and vigorous popularization of the Siemens MindSphere platform [and others], GE Predix is no longer alone.
Combined efforts by these industrial giants is expected to accelerate market applications and create a bigger pie for cloud-based industrial analytics.
Stone Shi is executive editor-in-chief, Control Engineering China. Edited by Mark T. Hoske, content manager, Control Engineering, CFE Media, mhoske@cfemedia.com.
KEYWORD Industrial cloud platform
- GE adjusts focus for GE Predix platform.
- Critical applications, such as aviation engines and gas turbines are key.
- IT expertise seems emphasized among recent hires for GE China.
Consider this
When looking at an industrial cloud platform, are the applications what matter, or compatibility and strengths relative to installed base?
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