Name: Jeff Immelt Explains What a ‘Digital Industrial’ Is
Uploaded: 2017-05-24
Duration: 4 min 19 s
Description: The General Electric CEO breaks it down.

Jeff, you've been talking a lot about reinventing General Electric, transforming it into a digital industrial. What does that really mean? Yeah. So we didn't go to bed one night and think we had to wake up the next morning and be Oracle or Microsoft. What we saw was the way that, let's say, technology was changing for industrial companies. I think what we're basically saying is to be a good industrial company in the 21st century You also have to have a foundation in digital technology. That's how you're gonna drive productivity, that's how you're gonna drive growth. And you've been telling GE employees, that when it comes to innovation, it doesn't always have to happen in a start up. And And as you put it why not us. Yeah, so totally. Yeah, and, but the thing is most people just think of the real innovations happening at these dynamic startups in Silicon Valley. Yeah, look I think it's incredibly important that the startup culture takes place. I love Silicon Valley. But if you get sick of your iPhone, right? You're going to throw it away and buy a new one, am I right? If you get sick of your jet engine, you're not going to throw it away. Your Morse scanner. You're not going to throw it away. So the industrial world is really this combination of dragging the legacy to create the new. So, I make it kind of a rallying cry for our team to say not only can we do it But we must do it. It's what our customers expect, it's what the world expects. I think you're gonna see a consumer internet. You've got an enterprise. Consumer internet's Amazon, people like that. Facebook. Enterprise internet is Microsoft, or [ UNKNOWN ]. [ UNKNOWN ] internet is gonna be this combination of Startups and old companies and it's gonna be really more of a mashing together of different genres and culture and we want to be a part of that. But what do you have to do to get the right people? I mean let's face it- Yeah. The smart, innovative millennials head right for Silicone Valley- Sure. To work at an edgy company, the new, new thing. They do not think of General Electric. The story I always would tell is if you're at 35, 000 feet Flying over the Atlantic Ocean, and the only thing keeping you aloft are two GE jet engines. Are you gonna want the technology that is around them to be from somebody who just showed up five months ago, or who's gonna switch companies every five or six years? You're gonna want that trust of technology. To be also embedded with all the new technologies that come with it. And that's what makes this wave so much different is that you've got to have some combination of industrial roots with digital Technology. You said you were expecting GE to be one of the top ten software developers by the year 2020. That's just three years from now. How realistic is that goal? And don't take this the wrong way, given that GE is a 125 year old industrial- [ CROSSTALK ] I think you gotta put a stake in the ground when you start these things. We're at a 20 % growth rate every year. We've been doing that the last four or five years. We're halfway to the goal right now. Look, I'd say it's just arithmetic. Fundamentally, if we form our base, grow the next four years at 20 or 25 %, you hit $ 15 billion, you're in the top ten. If that doesn't happen, what's plan B? Look I don't think, some of it's arithmetic, but in terms of being a digital industrial leader, there is no plan B. In other words, I think for us to be a successful industrial company, we have to be this successful digitally. I don't really have a plan B. Well, you've got this activist investor in Nelson Pelts, who's heavily invested. ANd GE. How might he put pressure on you and GE to change direction? So really, I think both Trian, but our other investors, as they underwrite the stock, we seen underwrite it with this in it. Him included. So in other words, I don't view this as kind of a hula hoop or something new and fresh. This is kind of integral to how GE stays on top, how we stay a great healthcare company, how do we stay a great aviation company, and the people that invest in the company underwrite it on that basis. Do you talk to Nelson Peltz on any frequency? Look, I talk to all of our investors. Really, I think it's Investors matter. But investors need to know where we're going as well. [ BLANK_AUDIO ]