Mindshare Before Market Share
Despite some progress, GE was missing a keystone of market-shaping: a new, shared language. If you are to have any success pulling the world to a new market before you have actual products—what I call mindshare before market share—you have to introduce a language with which you can talk about it. This new shared language allows your teams (and others) to work together and create new things.
The essence of innovation is not technology or business but the connections between them. Once you have a language, you can tell the story of the product and, in doing so, help to evolve and grow the product. The tough part is getting the story right, and spreading it far and wide.
For GE, the breakthrough came in late 2011, in a meeting between Jeff, Mark Little, Steve Liguori, Bill Ruh, and me in Jeff’s office. Mark and I were enthusiastic champions for a digital future, but for different reasons. Mark saw the capability to embed more sensors into our big machines, and I saw new end-user markets.
As we tried to define our new language, I continued to bring our story back to consumer examples, which would make Jeff crazy. “Imagine if your jet engine tweeted to you. What would it say?” Jeff made his “cartoon” face again.
“You know, Beth, I really don’t care what a jet engine would tweet. I care what my daughter tweets. Stop bringing me cute consumer examples, talking milk boxes, the ‘Internet of Things,’ ” he said, throwing up his hands. “This is industry, not the Internet.”
Without a second’s thought, Steve said the first thing that popped into his mind: “No, Jeff—it’s the ‘Industrial Internet.’ ”
Jeff often complained that Steve talked too much—but he didn’t complain this time.
“That’s so right!” I said.
“Yes it is, Steve! Yes it is!” Jeff said.
The Industrial Internet perfectly captured what we were doing. It was simple, and it gave us a way to explain to people inside and out that we weren’t selling to consumers on the Internet or marketing enterprise software like Oracle. We were capturing data from machines to give our customers better insights about the performance of machines and the equipment we made. It offered the kind of clarity that a new language needs to spread our message.
It may not have been sexy or clever, but it was practical and easy to understand. We are a digital industrial company building the Industrial Internet. We work with sensors, data, and intelligent machines, combined with big data, analytics, and predictive algorithms.
Next, we needed a way to spell out what the value proposition would be for the Industrial Internet. In other words, we needed to offer a simple and easily repeatable business model. We had to answer the question: What would it mean to a customer to have access to data from our machines?
That’s how Steve and Linda and I developed what we called the power of 1% effort—it was a way to talk to customers and, equally important, share the potential impact of the digital world—the world of software and zeros and ones—on our industry with media and investors. We picked a simple paradigm: What if going digital could increase industry productivity by 1 percent? How much would we save? How much would customers save? In aviation, a 1 percent savings on fuel would offer $30 billion over fifteen years; in health care, a 1 percent increase in productivity would return $63 billion in fifteen years; and in rail, a 1 mph increase in train speed would have a $200 million impact per year on one of our big customers.
These became jumping-off points for simple stories that could be shared and repeated across the company. For example: Did you know that the average train goes 21 mph? It’s not because GE can’t make them go faster—they do, much faster. It’s just that there is so much congestion of rail cars and other trains that rail transport gets slowed. By connecting sensors to parts of the locomotive and rail cars, operators know where they are and how to ease congestion faster. Same for a hospital. Did you know that a nurse spends an average of twenty minutes per day looking for misplaced equipment? With sensors and mobile devices, nurses can find things more easily and be more productive.
As we were developing the language of our business case, I realized I was going to have to make a concerted effort to get our business plan accepted in Silicon Valley. The Valley has a history of being both wildly open to new thinkers and every culture, and insular and elitist when it comes to “old” technology firms doing things differently. It helped that Mark had hired a longtime Cisco strategy exec named Bill Ruh. A global digital leader, Bill had heard the distant thunder of the future and came to GE with a longstanding passion for the “Internet of Things.” He quickly hired software engineers at a new GE Software Center of Excellence (COE) facility in the East Bay across from Silicon Valley, increasing our credibility in the Valley.
Next, I set up a kind of digital coming-out party for GE. Along with Alex Constantinople (who had left GE and was running the OutCast Agency communications firm, which had a roster of Silicon Valley tech clients from Facebook to Salesforce), we mapped out a view of the Valley that illustrated key influencers across a spectrum of organizations.
Soon, I had set up dinners for Jeff and me to meet tech-world stars such as Reid Hoffman of LinkedIn, start-up CEOs like Aaron Levie of Box and Lynn Jurich of Sunrun, Wired editor Chris Anderson, Stanford professor and Lean Startup architect Steve Blank, and venture capitalists like “The Godfather of Silicon Valley,” Ron Conway. Marc Benioff came to one of the dinners as did Netscape founder and famed venture capitalist Marc Andreessen. At each one, Jeff and I evangelized the Industrial Internet platform, selling it with possibility, mutual benefit, and a bit of fear of missing out on top.
One of those we reached out to was Tim O’Reilly, founder of O’Reilly Media, a technology publisher and convener who brought together thinkers and then propagated ideas that shaped the future. The term “open source” was coined at one of his conferences, as was the term and concept “Web 2.0.”
When I first suggested to Tim that we could team up to do original content around the Industrial Internet, he was dubious. “That sounds like something really commercial meant to benefit GE. And we don’t endorse products, you know,” he said.
But I flew out with Steve and Linda, and we laid out the story of the Industrial Internet: yes, it would benefit us, but it would also serve as a platform that would benefit everyone, like Marc Benioff’s propagation of Software as a Service.
We talked through a long dinner and a series of phone calls, and Tim came around to our image of the Industrial Internet as a real opportunity, as something bigger than the Internet of Things, which he now saw as the consumer subset of our project. You have to name it to claim it.
Like all major events, the Industrial Internet needed a launch party to make an irreversible grab on mindshare. In August 2011, Andreessen wrote an article in the Wall Street Journal that went viral, declaring that software would “eat the world.” He claimed that we were in the midst of a major technological and economic shift in which software companies would take over huge parts of the economy. As more products were made smart and connected, software would be the connective tissue for creating value, even at companies that sell physical goods; think Amazon, a software company that’s taken over retail offering vast arrays of products and free shipping from your couch. We agreed—to a point. But the physical world was not going away anytime soon. The race was now on for us to define value at the intersection of the physical and digital world. It was a way for GE to enter the debate with a splash, announcing, “The race is on.”
We planned our big event for November 2012 at San Francisco’s hot Dogpatch start-up hub, and we dubbed this “name it to claim it” shindig Minds + Machines. The guest list included scores of venture capitalists, entrepreneurs, tech thinkers (such as Andrew McAfee of MIT), media (of course), and customers, with the guest star being Andreessen himself.
The opening of the event caused a collective gasp from the audience, as
we unveiled on the stage an actual shell of a GEnx jet engine, huge and beautiful in all its formidable big iron power. And then we kicked off.
Before introducing Andrew McAfee, Jeff gave his intro, hitting hard on GE’s five thousand software engineers, the 1 percent story, and the announcement of Industrial Internet products we had twisted our business leaders into agreeing to.
After McAfee had blessed the idea, and Bill Ruh and I and an Alaska Airlines VP had dived down into the specifics of the information a jet engine could report, we moved to our big moment. Sitting in blocky white-leather chairs dwarfed by the GEnx, Wired’s Chris Anderson chaired a panel with Jeff Immelt and Marc Andreessen.
Andreessen expanded on the theme of his famous Wall Street Journal column about how the value in the economy was migrating to software—and would continue doing so inexorably—and that the best software companies would win the economy. His theory felt bulletproof, and for one moment I wondered if we would ever digitize that big jet engine. But Jeff seemed, in fact, to welcome Marc’s words. His response was magnanimous, and in almost total agreement.
“What we’ve learned is that there’s another 5 percent of productivity, 5 percent of fuel burnt, 10 percent of maintenance, to be saved by modeling the analytics around those products,” he said. “I’ve been CEO for eleven years, and eleven years ago I might have said, ‘Let somebody else do the analytics.’ ”
The new GE would make that market, though, he said. And to hit that point home, Jeff looked over at the giant GEnx engine, lit in a deep-sea blue, with something resembling love, like fathers look at sons, the way Steve Jobs looked at the first iPhone.
With twenty sensors, Jeff explained, the engine could generate a terabyte of flight data every day; GE’s latest locomotives are rigged with over 250 sensors that measure 150,000 data points per minute. GE had 250,000 pieces of intelligent hardware in other industries, Jeff said, from medical scanners to wind turbines. GE would gather and crunch that data. We would be an industrial platform player.
Jeff stood in front of the engine and said in closing, “Marc, eat this.” What he meant was, you still need jet engines and gas turbines to make the modern world go around. It was said in a friendly way, but with intent: there was a new Internet, an Industrial Internet, and we were at its center.
Discovery is an ongoing, never-done project in every company, but especially in a company as large as GE. Jeff formed a Software Council as a way to bring together GE’s various businesses around a common goal of creating more software and digital engagement.
Bringing together such communities gives birth to creative abrasion that radiates energy. Outsiders sometimes underestimate the power of going horizontal in breaking down silos to get an entire organization focused on a few core initiatives like digital.
Together, these communities constituted a classic sensemaking operation, tasked with seeing where things are more alike than different—for example, where solar energy technology meets societal desires for clean energy, or ultrasound technology that can be used to monitor and inspect oil pipelines or jet engines.
How to Get Your POV Out There
In the Middle Ages, wandering troubadours brought news of wars, royal marriages, and religious pronouncements. In ancient Greece, troupes of actors did the same thing. In the modern world, professional media organizations reported the big stories, first in print and then over the airwaves. Today, digital technology has opened up the field to just about anybody. When companies use digital channels to tell stories on their behalf, it’s referred to as branded content or brand journalism.
I believe that everyone—every organization—has the ability and the responsibility to tell the merits of their own story. Moreover, they have an obligation to do so. If you don’t tell your story to the people who are interested, somebody else is bound to do it for you.
We were an early pioneer of branded content. Telling our own story daily with GE Reports helped different parts of GE that might otherwise have rarely been in touch talk to one another. It uncovered assets that we didn’t know we had. It helped GE learn how to move forward faster and innovate as a company.
As more brands tell their stories, the quality of branded content has proven to be uneven, causing some to question the entire practice. But a few bad company stories have not lessened my faith in the process. The risk of running a less-than-optimal story is the price of sharing your point of view.
To get our storytelling capacity up to speed, we worked closely with Alexander Jutkowitz, cofounder of Group SJR, one of the agencies that pioneered brand journalism.
Here are his tips on branded storytelling:
Digital storytelling is in some senses a race. Speed matters.
Serialize and atomize. In an age of ephemeral content and short attention spans, the ability to serialize a story and tell it in small pieces over time determines its staying power. It’s essential to tell stories that can live anywhere and respect the rules and quirks of a particular platform (i.e., Twitter, Facebook, LinkedIn).
Too many companies assume that what they do is too boring for anybody to care about. That’s not true. Whether you are involved in infrastructure, tech, food service, consumer packaged goods, or financial services, you are supporting the basics of civilization. To you, it might be a daily grind; to somebody who doesn’t know your business, it is often a source of magic, wonder, wisdom, and fascination.
Platform Power: The Age of Brilliant Machines
Mind + Machines put us on the digital map; people started to believe we were serious. But we had also drawn attention. Our competitors now saw the opportunity. Digital-first companies like Amazon were opening up their cloud services to industry, and software giants like SAP and IBM followed. Even GE competitors like Siemens were turning their focus to data analytics.
The very public launch allowed (or forced) me to turn to my new role building models for ways we would commercialize digital. I used our new bona fides to hire Kate Johnson to lead digital commercial. A driven, good-humored Oracle sales executive who wanted to become part of the next wave of digital, Kate was charged with building a software solutions team that would include highly technical software architects who could translate customer data needs into products, not to sell the jet engine, per se, but to sell the technology and the software that would help make that jet engine more productive—i.e., run longer, burn less fuel, connect directly to the service team.
With Kate and me in the lead, our efforts shifted away from products to discovering new revenue models for GE digital. We created a center of expertise for digital sales and marketing—we needed to seed new capabilities with experts, especially as the need impacted every GE business. It was becoming clear that our contractual service agreement (CSA) model of selling a service contract for the life of the machine, with maintenance commitments and parts replacements, was reaching its limits. New technology innovations were happening faster, and the technology was better, meaning less need for service. And services are high margin with customers eager to take back profits. Digital would add new opportunities to upgrade machine output and create additional revenue streams. By embedding software, the machines could be upgraded remotely with new offers—for example, determine the wind speed affecting a turbine blade—as a subscription or à la carte (just like your smartphone after all!). This was also potentially disruptive, meaning remote software could replace in-shop repairs in many cases. If we didn’t offer this, someone else could. This made everyone nervous, especially as our customers wanted more integrated systems—products plus software. They wanted to buy “outcomes”—i.e., productivity or savings—not just a jet engine. In some ways, Ecomagination was our first outcome-driven initiative—delivering energy efficiency and economic impact. Now we were poised to take this big with data.
Much of the heavy lifting of these major organizational pivots
has to do with bringing in the right outside agitators, sparks, and translators. We almost didn’t find Kate. Frustrated that we had few women among the senior ranks of GE sales leaders, I could hardly complain if I wasn’t addressing this directly when I hired new people. I called up the recruiter and asked, “Why are you not giving us more women candidates?”
“There just aren’t many women available,” he said. “Try, as we do, I can’t find many women in software.”
“What?” I countered. “There are no women selling software? I don’t believe it. We’re not going to move forward until we have female candidates to consider.”
We found Kate and three other women who could be candidates for other roles. Kate hired sales and marketing leaders from software companies and embedded them into the business units to model the kind of market development and selling required. Sales leaders were increasingly required to be more consultative, helping customers operate better, not just sell them a product. Value propositions were changing—sales and marketing would have to work more closely together. Business unit CEOs had a hard time at first understanding all of the changes that digital was bringing, and progress was slow. As I had seen at NBC, the fight between digital and big iron represented the haves and the have nots—the cool kids and the legacy. Digital moved from R&D to become an official GE business unit, making the tension even more pronounced. Kate grew to lead all digital sales; and while she accelerated revenues and hired great people, the tension of all that change took its toll. Sadly, after four years with GE, Kate left for a big role at Microsoft.
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