#1: GE Keeps E-Business Turned On

By Lisa Vaas  |  Posted 2001-11-12 Print this article Print

Corporation set to boost IT spending 12 percent; pushes suppliers, partners to embrace the Net.

Jack Welch may be gone, retired as CEO, but the hard-charging management style that earned him the title Neutron Jack lives on at General Electric Co. Only now, rather than just focusing on improving the employee gene pool by lopping off the 10 percent of workers with the lowest performance appraisals—Welchs success formula—the management mantra is to transform GE into an e-business by digitizing as many business processes as possible. A typical step: GE Global Exchange Services recently banned pen and paper in its few remaining nonvirtual meetings in favor of laptops with wireless LAN cards.

The "do this or else" nature of the edict is pure Welch. Its also part of a much larger e-business drive at GE that includes digitizing as much as possible the information that flows through all of GEs key business processes. That means moving to electronic transactions for everything from finance and human resources processes to sales invoicing and reconciling. GE even imposed a Nov. 1 deadline for all invoices and payments between internal purchasing agents and suppliers to be made via digital channels. Its also moved travel requests to an online travel center, where travel approval is built into the workflow. That initiative alone is expected to save GE $200 million this year in improved efficiencies and reduced travel.

Altogether, according to executives, all GE digitization initiatives will shave off about $1.6 billion in costs for this year and up to $10 billion in coming years. Its that kind of commitment to e-business, in spite of the economic slowdown, that earned GE, based in Fairfield, Conn., the No. 1 slot on eWeeks yearly FastTrack 500 list of technology innovators.

Its little wonder, with savings in the billions on the horizon, that GE is rethinking neither its e-business strategy nor its IT spending levels, economic downturn or no economic downturn. The company is on track to increase IT spending 12 percent, to $3 billion, this year. "Weve been doing it when times are good and when times are bad, and we believe in it," said Gary Reiner, senior vice president and CIO, in Fairfield.

GEs focus on technical innovation shines in countless ways across its 20 divisions. One sell-side example is a precision fulfillment initiative in GEs consumer appliance business, a program introduced last year in conjunction with retailer The Home Depot Inc., of Atlanta (No. 440 on the FastTrack 500). The program allows customers to walk into a Home Depot store, buy an appliance online at a kiosk, and select a delivery date and time. Web-based systems at GE warehouses help coordinate fulfillment and promise deliveries within 15 minutes of customers specifications.

Lisa Vaas is News Editor/Operations for eWEEK.com and also serves as editor of the Database topic center. Since 1995, she has also been a Webcast news show anchorperson and a reporter covering the IT industry. She has focused on customer relationship management technology, IT salaries and careers, effects of the H1-B visa on the technology workforce, wireless technology, security, and, most recently, databases and the technologies that touch upon them. Her articles have appeared in eWEEK's print edition, on eWEEK.com, and in the startup IT magazine PC Connection. Prior to becoming a journalist, Vaas experienced an array of eye-opening careers, including driving a cab in Boston, photographing cranky babies in shopping malls, selling cameras, typography and computer training. She stopped a hair short of finishing an M.A. in English at the University of Massachusetts in Boston. She earned a B.S. in Communications from Emerson College. She runs two open-mic reading series in Boston and currently keeps bees in her home in Mashpee, Mass.

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