General Electric's Spin Machine - Company Business and Marketing

Industry Standard, The, Jan 22, 2001 by Mark Roberti

Whatever the impact on the stock market, the PR campaign has been a triumph. Magazines, newspapers and trade journals have been awed by GE's e-business "transformation." In July, Forbes named Jack Welch to its "E-Gang," alongside such established e-businesses luminaries as Cisco's John Chambers and Enron's Jeff Skilling. Business Week e.biz named GE to its "Web Smart 50." And Internet Week, a trade journal, declared GE "E-business of the Year."

The story goes something like this. In late 1998, Jack Welch noticed GE employees shopping online. At home, his wife was buying gifts on the Web for the grandchildren. Suddenly, Welch "got" the Net. At an annual meeting of 500 of GE's top executives in Boca Raton, Fla., in January 1999, Welch ordered everyone to come up with a strategy for moving their businesses online. The executives were to set up "Destroyourbusiness.com" teams. The aim: Reinvent each unit's business before some upstart in a Silicon Valley garage did.

But the execs knew nothing about the Web. So Welch took an idea he'd heard about while visiting a subsidiary in Europe and made it a corporationwide mandate: Some 1,000 Web-savvy employees were assigned to mentor senior executives about the Internet. Even Welch got a mentor. Armed with the wisdom of people like Stuart, the red-haired slacker who tutors the old-line executive in the Ameritrade commercial, the remaking of GE was under way. The teams got beer parties and brightly colored offices, an attempt to create a proper dot-cam aura. Eventually, they discovered that there probably weren't any Internet entrepreneurs hiding out in Silicon Valley devising ways to sell turbines or aircraft engines online. With that fear laid to rest, the teams were transformed into "Growyourbusiness.com" units. Later, they were disbanded altogether, and e-business was brought into the mainstream of GE's operations.

All that work seemed to pay off. GE Power Systems, a $10 billion unit based in Schenectady, N.Y., that sells power-generation equipment and parts, created a site where customers can order from an online catalog of replacement parts. They can also use the site to compare the performance of GE generators to that of others.

Similarly, GE Aircraft Engines, a $10.6 billion division based in Cincinnati, put its catalog of spare engine parts online. Customers can check pricing and availability in real time. Aircraft Engines has also developed Web sites where its biggest suppliers can go to schedule deliveries and handle billing.

GE Polymerland, the distribution arm of GE Plastics, a $6.9 billion unit based in Pittsfield, Mass., has a site where customers can use online tools known as wizards to decide what types of plastic or resin they need for a mobile phone case or auto part. Then, they can order the materials for injection molds online.

And GE Medical Systems has created diagnostic tools and a wizard that helps GE's salespeople and customer technicians work together to set up magnetic resonance imaging equipment. The unit has also begun to offer software for tis equipment over the Web. Medical Systems CEO Jeffrey R. Immelt was recently named to succeed Welch as GE's Chairman and CEO. (Welch, 65, had planned to retire early this year but agreed to stay on to stay on to manage GE's acquisition of Honeywell International.) Immelt has already indicated that he's committed to GE's Web strategy.