Discussion on:

GE's $200 million bet to resurrect IT

That is $769K and change for each job. Or enought for each "worker" to buy a 100k house and get 50K a year for 13 years or their $13/hr for 24 years. Hell, I'll take that.

There are a lot to variables in play, but I'll hold the applause until after a couple of years running. Even if, the place might still go under. Didn't hear a lot of chatter about customers in the article. Material peice of a business plan is that if customers don't buy you go broke. Maybe this is part of GE's discussion but much like with the Volt, I'm not hearing it.

FYI $13.00hr is just over 1/2 the average wage in the US. After income taxes SSI, sales tax, yatty yatty, you are talking poverty level for just one person working with a family of 4. A single person could finance a car on it though.

While a firm capitalist, I am convinced that there is probably some level of government interaction that is good. But do the math on this one and it has "insane" written all over it. A billion dollars to create poverty level jobs? Really?

So if all goes well, and you work all your life at one of those jobs, you can expect to die poor. Wage cropping action. And yet, it is better than millions of Americans are doing right now.

Public companies don't invest money to create jobs. They invest money to make money, which requires skilled workers to make it happen and ends up injecting money into the local economy and has beneficial effects on the entire ecosystem.

You also have to remember that those 1,300 jobs are only the jobs that are for full-time workers at GE. Lots of other contractors and consults end up getting work out of the reinvestment. The manufacturing business is also far more automated than it used to be, so much of the investment is also in equipment, systems, software, etc. So that money goes to companies that are making hi-tech products to help GE be more efficient (and the people at those companies are highly-paid specialized workers). The economics are lot more complex (and favorable) when you look at the whole picture.

But I still long for the days when people invested in a business because it was THEIR business and would never consider it the taxpayers responsibility. If we paid less taxes maybe GE would have found investors instead of having to hit up Uncle Sam.

"The federal government stepped in and provided assistance from the Recovery and Reinvestment Act of 2009 and ultimately gave a slew of tax breaks and incentives for GE..." Why, if not to create jobs?

And by the way, how much is a slew? How much skin does GE and its investors have in this game, and how much is supplied by Uncle Sugar?

I think it is great that GE is bring jobs back to the US. I agree with Jason Hiner, investing $1B in their facilities is going to have a positive affect on lots of different businesses in the local area and even surrounding states.
However, I think it would be better to highlight the IT overhaul after 20 years, the process changes that make their IT dept more efficient and more of a business driver and finally a nice new datacenter. Rather than what it is costing them.
As @maszsam has pointed out, on the surface spending $150 million on new software to save up to $60 (over five years) doesn't on the surface make sense. Add in a $1B datacenter and then it seems like they are just creating a showpiece to say..."Look what I did". It doesn't seem practical or efficient.
As the title implies....I hope the "bet" includes a lot of efficiency for their business that will translate into billions for the economy, that have not been discussed in either article.

Great job, GE! And kudos to the team who are making it happen... When we look across the industry, however, we see more ERP failures than we see successes. Consider, for example, the multi-year CSC / Oracle ECSS project for the Air Force, which has been declared dead only recently: over $1 billion spent, "negligible value received". In that case, and in many others, the better solution would have been to modernize the old applications, add SOA for integration, remove redundancy, and become more agile with a code base uniquely adapted to the requirements. The last thing that should be done in these situations is the traditional, spend-3-years-writing-requirements-and-blow-the-budget waterfall approach.

So why is the GE experience different? It has to come down to the people, to the sociology, to getting committed people in one room and making a difference. And that is why this lesson is going to be hard to duplicate and use as textbook material -- because there will be different people with different motivations in every case. Hats off to Mr. Kocsi, too, he's obviously a leader and in the end, that's the one thing that is always in short supply: leadership.

Now the question is, once the ERP is in place, how does information processing STAY agile? Because customizing the ERP going forward is a limited option...

An inspiring story. And my favorite part: I didn't see any mention of Microsoft.

What about Leo c. 1949?

Britain was the birthplace of commercial computers. The Ferranti Mark 1 produced in 1951, the first one went to the university but the next nine were sold commercially, (including in Canada so the US might just have noticed). However there is a lot of Sperry hype on how Mauchly & Eckert invented the first computer. Not true as the US courts showed in 1973. However it wasn't the Brits it was Atanasoff who built the first proper digital stored program computer, but the Brits were the first to commercialise them. Next thing you'll believe is that Edison invented the electric light bulb.

Finally a rejection of the idiocy epitomized by J Welch who made himeself rich, destroyed GE's stock value for millions, closed and shuttered a major manufacturing companies multiple plants and layed off hundreds of thousands of workers from good paying postions... GE needs to get back to manufacturing and producing and doing it smart and economically. We can do this and begin a resurgence of American manufacturing in high technology desireable products...

Bravo!!

... it just sounds to me like through their whole history they just wanted to beat workers into submission, and when they failed to get as much as they wanted, they off-shored ... and now that the locals are desperate for work they are starting back up again.

Government grants + tax-breaks + workers on $13 per hour ??? ... isn't that called incompetent management &/or no business case whatsoever?

I think your comment about GE being the first commercial organisation to have a computer is wrong: LEO, Lyons Electronic Office, was running for J Lyons, the UK baking and catering company, in 1951. I guess this is what Mike@ was questioning above

They promised in 2010 and 2011 for their Challenge in Ecomagination.
In the end nobody got NOTHING.
Only a few local friends.

Just months of work on ideas and projects for the contest for 933 viable ideas.
The just put OUR ideas on ice.

http://www.ecomagination.com/ar2010/overview/ecomagination-challenge/

Just all words and empty promises.
T L.

I'm all for bring blue collar factory jobs back to North America but why do we have to ship our skilled IT jobs to India to do it. Bringing unskilled jobs to North America and shipping skilled jobs to 3rd World Countries in the end will make North America 3rd World. If we keep shipping all our it jobs to India soon there won't be enough qualified IT professionals in North America and we will need to start hiring East Indian IT professionals and moving them here because the unemployed IT guys here don't have the skills companies want. Oh wait companies like Morgan Stanley have been doing that for years. Their IT department is basically run by East Indians. No offense to the East Indians, they do a good job but this is at the expense of local unemployed IT professionals. All in All, this GE plan seems like a nice idea but is only trading unskilled jobs for skilled jobs (I do understand that's generalization and some factory jobs are skilled).

"a plant that was on the verge of shutting down just four years old."
Since the plant is referred to as "historic", I assume this was meant to say "four years ago." or was the plant really only 4 years old?

Are their people and smart machines on the floor whose information is being collected and reported accurately, easily, and in real time? Are plant floor processes and work orders being driven and managed by systems integrated with the planning and ordering systems? Inquiring minds want to know as these are key elements of a scuccesful seamless manufaturing company's information model. Or should be.

I admire GE for wanting to bring jobs back to the US, but as long as there are unions, they will be back in the same mess they encountered in the 80s.

In 1951 Lyons Co. in England installed the world's first business computer called LEO. GE's was first in US.

When I first saw the headline I thought GE was recreating the old ITS group. I was hired on in 1999 3 months before Y2K and as soon as the event fizzled was laid off and ITS was majorly downsized. Good read none-the-less.

...is Good Buddies with 0bama, so that is how he got so much of my money, er, sorry, Federal Government money that grows on magical trees. GE also has had several years of not paying Federal taxes. Almost the definition of fascism.

I recently purchased a cooktop from GE via home depot. I have not yet installed it but have read the installation instructions. They only covered how to anchor it to the counter for wood or tile countertop while we installed a granite counter. After calling around to various GE contacts all we got conflicting suggestions or a plra of ignorance. After considerable investigationfrom non-GE web sites I found a satisfactory method. However, it does not generate much confidence in GE's attention to details considering that engineered and natural stone are very popular.

Good read and inspiring stuff!!!! GE achieving their deadline to deliver their business goals is absolutely necessary to make the rest of the world think twice before investing in bigger projects. This can either be a classic case study in years to come based on GE's achievements from here on. Agree with Jason that economics is complex but such innovative and bold ideas will only take GE further in potentially creating the green jobs, which in turn sets the ball rolling in the US manufacturing industry.

Kudos to Mr.Kocsi and team for their achievements so far.