General Electric pursues the outcome of Internet of Things

SUMMARY:

GE is already big in IoT through doing it for its own products and services, but now Global Software VP, Bill Ruh, is breaking out and chasing the global market for what he calls `Industrial Outcomes Management’.

Bill Ruh
Bill Ruh

Is there a danger that, with subjects such as the Internet of Things (IoT) even the terminology used persuades people to look at issues from the wrong end of the telescope? That would certainly seem to encapsulate the thinking of Bill Ruh, Vice President the Global Software Division of General Electric (GE).

GE itself is one of the biggest producers of large, expensive and inordinately complex manufactured systems. If you have flown on any jet airliner recently the chances are you have been pushed along by GE engineered and manufactured engines, or used at least some electricity generated by GE-made wind turbines.

And as the software division of a company with such a diverse range of engineering products and systems, there is no surprise to be had in the way Ruh is pitching it at being one of the big kings of the Industrial side IoT. The company’s overall background as designer, manufacturer and, quite often, end user as well, it is in a good position to both play a major role and understand what the issues really are.

When it comes to terminology, Ruh understands that this is no longer about selling technological solutions to problems, so you won’t find him talking about technology too much:

In practice, the company’s role is selling Industrial Outcomes Management. In the end, the customers are not looking for an Internet of anything, they are looking for the right outcome from their industrial activities.

Measuring and monitoring

The monitoring of industrial systems, from the detailed measurement of the movements of individual components through to policy management of major sub-systems, is only part of the problem for the user. The wider issue is why the measurement and monitoring is important: what is it that the business really wants to achieve and why is that important.

As Ruh points out, tuning some industrial process to save 2% on the costs of some raw material may often be more trouble than it is worth, but when it is shaved off the annual fuel bill for a major airline or electricity generating business, the savings can be measured in $billions. Helping wind turbines operate more efficiently so they can produce 2% more electricity creates a significant boost to revenue over a year.

And because this is a new area for both the IoT technology vendors and service providers, Ruh is also well aware that determining the actual nature of the outcome required can be difficult for some businesses, so working out what they should pay for the delivery of that outcome is equally difficult. Payment options have therefore becoming a subject that takes up a fair part of his thinking.

He is, for example, aware that even the classic cloud annuity payment model of subscriptions is not always appropriate when set against the outcomes that any industry is aiming for. So alternatives such a taking a percentage of a revenue increase or a cost saving, or even becoming a revenue-sharing project partner with the customer, become options available for consideration.

When it comes to building a channel network the company is now starting to move into this approach to the market, and is now actively seeking specialist vendors and service providers that have a strong track record in specific market sectors. For example the company has already signed up Softbank as a partner providing applications targeting the shipping industry, and according to Ruh up to five more should be ready to announce before the end of the year.

The company’s primary lever in building partnerships is its Predix platform. Developed as the equivalent of an IoT `operating system’ for its own use, the company is now both using it as the opening it up for use on customer projects. It will also be available to its growing number of channel and technology partners.

Makers and shakers

As well as looking at software solutions for monitoring and controlling a plethora of industrial sensors strapped onto a huge range of industrial `things’ Ruh is already working on developments that will make monitoring an integral element of any component that needs its state measured in some way:

We are now seeing real growth and potential in the Maker Movement in the USA, particularly with the arrival of 3D printing.

The Maker Movement is a community-wide uprising by people who, most often, were never taught physical skills, such as cookery, woodwork, car mechanics or anything that fitted the normal definitions of DIY.

Such people are now feeling the loss and coming together to learn and develop skills. And not just olds ones, either. The arrival of the 3D printer, coupled with people with conception of what are `normal’ design limits for physical items, is opening up new approaches to product design. Ruh says:

We are watching this closely as it starts to become possible to embed monitoring technologies right into product designs in ways that are only possible with 3D printing.

Such possibilities are likely to be important in meeting the key objective of providing industrial internet services and managing the outcomes, which Ruh sees as creating more value from the cost of installing the technology in the first place.

industrial_internet_consortium_1x2_module-300x160With the formation of the Industrial Internet Consortium last year, of which GE is one of the founding members, this type of development could gain rapid acceptance within such as organisation.

Its key objectives include driving innovation through the creation of new industry use cases and testbeds for real-world applications; defining and develop the reference architecture and frameworks necessary for interoperability, trying to influence the development of standards for internet and industrial systems, and help foster open forums to share and exchange real-world ideas, practices and insights.

My take

Positioning the industrial applications of IoT as `outcomes management’ is a bold move, but puts the emphasis squarely where it should be, not just for IoT applications the wider world of cloud services as well.

And the potential for embedding monitoring devices in 3D-printed components opens up a world of new possibilities.