GE Predix platforms focus narrows as Flannery cuts Digital spending

GE Predix platforms focus narrows as Flannery cuts Digital spending

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The shifted focus is good news in many respects, analysts interviewed agreed.

We do not believe that existing customers should abandon ship today, but with GE shifting support for some industries to distributors, customers need to understand the GE strategy going forward, Littlefield wrote.

GE declined a request to comment with more details on what that would mean for the Predix product road map, with a spokesperson saying, The Predix road map continues based on what weve already stated externally.

Digital continues to be very key to the company, Flannery said on the webcast. The main message from me to you about Digital is a much more focused strategy. Were still deeply committed to it, but we want a much more focused strategy.

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Questions remain, however, in the details of driving more focused Predix efforts.

[This weeks] announcement was the beginning of GEs journey. Although some major directions were set, there are still a number of pieces that are not clear and will be shaken out in coming months, Kocher said. This is not a one-year initiative. It will take several years to get GE back on track.

GE had made it clear during its Minds + Machines event held last month that Predix is more of an edge-to-cloud platform rather than simply a cloud platform, according to an email interview withMatthew Littlefield, president and principal analyst at LNS Research. At the event, GE highlighted applications and how they could solve specific industry problems in mining, power, and oil and gas. Its new industry focus will concentrate on solutions that align to core GE businesses and away from industries served by plant applications like food and beverage and consumer packaged goods, he said.

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Customers no longer want platforms and big-bang technology projects. Instead, they demandscalable applications and analytics with use cases, [that are] easy to implement, and deliver quick ROI and business value, Littlefield wrote.

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As such, GE will focus Predix platform investments in the things that really differentiate in an industrial world, Flannery said on a webcast, like building outedgeto cloud anddigital twin capabilities. It will sell a focused platform and application into its installed base and seek to cut GE Digital costs by $400 million in an effort to double Predix revenue to $1 billion.

As such, GE made APM the centerpiece of the application push at its Minds + Machines event, according to Littlefield.Regarding plant applications, it was clear from the event that GE has not abandoned theProficyinstalled base, but it was also clear that plant applications is only a small part of the overall GE Digital vision, Littlefield said.

GE will focus onasset performance management(APM), operations performance management (OPM) and Service Max applications built on the GEPredix platformas it narrows its focus to areas where there are opportunities for digital disruption,CEO John Flannerysaid in a recent investor event in which he revealed his strategy for the Boston-based industrial giant going forward.

Hopefully in their efforts to cut costs, GE wont kill the goose that is laying the golden eggs of its future, Kocher said of GE Predix in an email interview. Or to use another metaphor, aggressively cutting costs and overly constraining GEs initiatives in making the Predix platform the heartbeat of the industrial internetwould be like throwing the baby out with the bath water.

GE Predix platforms focus narrows as Flannery cuts Digital spending

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The proposed changes will simplify GEs business and will bring much needed focus to aviation, healthcare and power, which are core, according toChris Kocherof Grey Heron, a San Francisco-based management and strategic marketing consulting firm.

Kocher also pointed to the cultural emphasis driven by Flannery on customers as their North Star and positive changes to that end, including changes to executive compensation to be more oriented toward incentive-based compensation.

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