By Alwyn Scott – The $4 billion GE has spent on developing digital products – ranging from tiny sensors in jet engines to augmented reality and software that can crunch large volumes of data – is on the scale of investments Google and Facebook Inc (FB.N) made to build their businesses, Bill Ruh, CEO of GE’s digital division, told Reuters.
Now that GE has shed non-essential operations, including most of its large financial unit, its fortunes will rise or fall depending on whether that investment delivers.
GE’s technology – and similar systems by IBM, Siemens AG (SIEGn.DE) and others – is a hot new battleground in manufacturing.
The companies promise they can spot problems before machines break down, yield cost savings of 30 percent or more, and raise labor productivity that has slowed sharply in recent years.
The company has spent $5 billion setting up new U.S. factories in the last five years. As it now adds digital technology to its plants, it needs fewer, and higher skilled, workers than in the past.