Vivian Zhao

eBusiness Director, GE China

September 24, 2001
GE History

• GE traces its beginnings to

Thomas A. Edison, who
established the Edison Electric
Light Company in 1878.

• In 1892, a merger of the

Edison General Electric
Company and the Thomson-
Houston Electric Company
created the General Electric
Company.
Dow Jones Industrial Average: GE Was There, and Still Is
Then Now
Companies in the Original Dow Companies in Today’s Dow
Jones Industrial Average—1896 Jones Industrial Average

American Cotton Oil Alcoa Int’l Business Machines

American Sugar American Express Intel
American Tobacco AT & T J.P. Morgan Chase
Chicago Gas Boeing Johnson & Johnson
Caterpillar McDonald’s
Distilling & Cattlefeeding Citigroup Merk
General Electric Coca Cola Microsoft
Laclede Gas DuPont Minnesota Mining &
National Lead Eastman Kodak Manufacturing
North America Exxon Mobil Philip Morris
General Electric Procter & Gamble
Tennessee Coal & Iron General Motor SBC Communications
U.S. Leather Hewlett-Packard United Technologie
U.S. Rubber HomeDepot Wal-Mart
Honeywell Walt Disney

GE was the Only Company on Both Lists When Dow Jones

Celebrated 100th Anniversary
GE Overview
11 Operating Businesses

Lighting Aircraft Engines Capital Services

Power Systems Industrial Systems Plastics

Transportation

Medical Systems NBC

Global Exchange Systems Appliances

Multi-Products and Services with $130B

Revenue and $12.7B Net Income
GE Stock
GE 股票业绩 Performance 1980-1997
－ 1980-1997
GE
GESurpass
超过 DJIADJIA and
and S&P
S&P 500
500
$3600

GE
3000 GE
$3,315
$3,315

2400

1800
DJIA
$1,555
DJIA
1200
$1,555
S&P
S&P500
500
600 $1,300
$1,300

0
'80 '85 '89 '93 '97

1980 1997

What a Shareholder can get from $100 Investment

Revised 5/98
GE Expanding Growth Opportunity
$130B

GE Revenues

12-
13%

$70B
7%
$50
B
6%
$26
B

'80 '90 '95 '00

New GE Playing in a Multi-Trillion Dollar Market

GE Growth --How Do We Accelerate
It?
Driven by Operating System
Globalization
Markets Sourcing Intellect

Services
OEM Third Party High Tech

Six Sigma
Productivity Market Share Way of Life

e-Business

E-Business Critical to Delivering in 2001 and Beyond

The Evolution of GE e-Business

1Q99 2Q99 3Q99 4Q99 1Q00 2Q00 3Q00

• Added e-Business as the 4th GE Initiative
• Establish New e-Business Team at Each Business
• Objective: “Destroy Your Business.com”
- Understand the New World
- Benchmark Competitor Online Capabilities
- Proactively Attack Your Own Business
1Q99 2Q99 3Q99 4Q99 1Q00 2Q00 3Q00
• “Grow Your Business.com”
- Internet an Opportunity, Not Just a Threat
• Develop World-Class e-Channel (CWC)
- Simple/Easy/Sticky
- Competitive Benchmarking
• Leverage GE Brand/Capabilities
- We Have More than “Clicks” , We Have “Bricks” and Fulfillment
• Make Strategic Equity Investments
The Evolution of GE e-Business
1Q99 2Q99 3Q99 4Q99 1Q00 2Q00 3Q00

• Weekly e-Metric Tracking

- Buy/Make/Sell
• e-Business “Takeover”
- e-Biz Leaders = C.O.O.
• e-Mentoring for Top Execs

1Q99 2Q99 3Q99 4Q99 1Q00 2Q00 3Q00

• Digitization
- Huge Cost-Out Opportunity
- Competitive Benchmarking

• Sourcing Deflation
- e-Auctions
• Customer Migration
 GE e-Business Approach

• Web-enable processes
e-Make • Intranet/ Collaboration Tools
• Internal Wizards
E-Metrics

e-Sell e-Buy
GE e-Business
Approach
• Transactions • SourceBid (e-Auctions)
• Value Added Services (or • Supplier Extranet (Direct)
External Wizards) • e-Procurement (Indirect)

Equity • E-Business Suppliers

• Strategic Plays

Prioritize Opportunities…Focus On The Objectives

 Buy Mak Sell
eBuy e

E-Auctions Transaction Costs

($40B Total Buy) (3.5 Million Transactions)
$6B
Non e-Enabled
$50/TX

$200MM e-Enabled
$5/TX
'99 '00 '99 '00

% Savings 20% ~12-15%

Savings
~$6B Potential ~$150M
M
eBuy Buy Mak
e
Sell

How to work with Suppliers-Example of GEPS

INTRANET EXTRANET INTERNET

GE Yahoo.com
Web-Site
GE.com
Sourcing
Customers and gepower.com
Project
Tracking Suppliers Application &
with Secure Database Servers
GEPS Application & Access to GEPS
Database Servers Intranet via
Internet
Internet
Subscriber
eBuy Buy Mak
e
Sell Online Application

On-line Auctions Electronic Invoicing

Supplier Scorecards

e extranet
DART – Milestone Tracking
Engineering Documents

E-Logistics E-Marketplace E-Packing List

eBuy Buy Mak
e
Sell
E-Auction
A Web Based Utility that Allows Suppliers to Prepare and
Submit Online Bids for Request for Proposals (RFQs)
•Price Negotiation Cycle Time Reduced
Significantly

•Simplifies Supplier Approval Process by

Quickly Eliminating Non-competitive
Suppliers

•Reduced PO Placement Cycle Time

•Standardize and Streamline the RFQ

Process... Simplifies Proposal
Evaluation - Price, Quality, & Delivery
E-Enables
E-Enablesthe
theTraditional
TraditionalSourcing
SourcingProcess
Process
eBuy Buy Mak
e
Sell E-Auctions Example

Fastener Auction (12/99)

• Suppliers Identified / Contacted: 23

• Active Bidding (Participants): 15 Suppliers

• # of Parts: 20

• Total Bids: 265

• Duration: 33 Hours

• Savings Greater Than 80% (>$1.2 million)

eBuy Buy Mak
e
Sell
E-Invoice
An Internet-based Invoice Inquiry and Invoice Creation and
Submission Tool

• Self Service Inquiry Allows Suppliers to

View Invoice Information and Payment
Status On-line

• Web Invoices Will Have to Match the PO

up Front, Removing 50% of the Matching
Problems That Hold up Payment

• Invoice Will Not Have to Wait for Mailing

Time to Arrive at Accounts Payable

• No Manual Data Entry at Accounts

Payable … Less Possibility of Error

Replacing
ReplacingPaper-Based
Paper-Based Processes
Processes
eBuy Buy Mak
e
Sell
E-Logistics
Internet-based Tools Used to Request Transportation
Instructions and View Shipment Tracking Information

• Advanced Data Input Capabilities Allows Rapid

Input of Requests Via Web

• Freight Tracking On-line Regardless of Carrier

Being Utilized

• Reduces Errors > Data Feeds Directly Into

Database

• GEPS Personnel Able to View Shipment Status

Reports On-line Thereby Reducing GEPS
Requests for Information

• Ensures Timely Delivery of Goods to GEPS

www.gepsrouting.com Internal/external Customers

Replacing
ReplacingPaper-Based
Paper-BasedProcesses
Processes
eBuy Buy Mak
e
Sell Scorecards
The Scorecard is GEPS’s Primary Vehicle for Supplier Measurement by
Providing a Summary of Cost Reduction, Quality, Delivery, and
Supplier Integration.

• Real-time access to GEPS supplier

evaluation
• Provides supplier the ability to
understand evaluation criteria, current
Supplier XYZ
evaluation status, and areas for
Company ABC
improvement
Buyer ABC Phone #: 555-555-5555
SQE ABC Phone #: 555-555-5555 • Sets benchmark for new suppliers
• Allows supplier to focus on strategic
cost reduction methods - not just
price

Our
OurTool
ToolFor
ForEvaluating
EvaluatingOur
OurSuppliers
SuppliersPerformance
Performance
eBuy Buy Mak
e
Sell DART
Document Archive & Retrieve Tool--Allows the Supplier to Retrieve and
Print Drawings and Specifications Associated with Open Purchase Orders

•Internet Access to GEPS Drawings

•Reduced Cycle Time to Attain

Drawings and Complete a Project

•Reduced Costs - Delivery, Printing,

Etc.

•Increased Specification Accuracy

Drawings
DrawingsImmediately
ImmediatelyAvailable
AvailableOn
OnOpen
OpenPurchase
PurchaseOrders
Orders
 Buy Make Sell
eSell

• eSell generates revenue for GE through:

• Online transactions

• Adding value to what currently offers customers

• Forcing GE to change its behavior and become more

competitive, based on customer use of the Internet

• The Internet becomes a critical source of real-time customer /

GE interaction and relationship management

• The Internet allow GE to build on its image of “provider-friendly,

stable partner, 24x7.”

$1 Billion Online Sales in 1999 and $7 Billion in 2000

 Buy Make Sell
eSell

GE Plastics--Polymerland:

• Online sales & data portal

for the plastics industry

• Strong design, research

and order status capabilities

• Current order rate of $15M

per week
 Buy Make Sell
eSell

GE Plastics--Polymerland

• Customer may “make” a

particular color for a certain
material

• Online order the color

sample sheet

• Delivery within 48 hours

which used to be in several
weeks
 Buy Make Sell
eSell

GE Power Systems:

• Leading online transaction site

for the utilities industry

• Product & service

comparisons

• Warranty, repair & installation

• Wizard used to guide

customer to find out the
gepower.com potential problem
 Buy Make Sell
eMake

• Eliminate Manual Activities

• Improve and Simplify the Workflow Process

• Paperless Work Environment

• Unnecessary Touch Point Reduction or Elimination

• Better, Faster Information

• Reduce Support Resources

• Digitize EVERYTHING

40-50% Savings on Make Costs at $1.5 Billion in 2000

 Buy Make Sell
eMake
Keys to Success

• Leadership and Top-down Support

• Involve Customers Through the Effort

• Get Business User Buy-in and Participation

• Six Sigma as the Enabler

• Don’t Wait Until Everything is Perfect. Just Begin

• Boundaryless Learning Environment

• Follow up with Customers After Launch

The e in GE takes on a
whole new meaning.