Abstract In the past, I read GE's white papers on industrial Internet and related analysis reports. I also had the opportunity to directly hear from Chairman Ismail's interpretation of this concept in Beijing, and I understand the implications. In the words of Ismail, the so-called industrial interconnection...
In the past, I read GE's white papers on industrial Internet and related analysis reports, and I have the opportunity to directly hear from Chairman Ismail's interpretation of this concept in Beijing, and I understand the implications. In Ismail’s own words, the so-called Industrial Internet is an “open, global network that connects people, data and machines. The goal of the Industrial Internet is to upgrade those key industrial sectors.†“This is a huge physics. The world, consisting of machines, equipment, clusters and networks, can be combined at a deeper level with connectivity, big data, and digital analysis. This is the industrial Internet revolution."
GE can be regarded as a leading company in the global industrial equipment manufacturing industry, and plays an important role in the manufacture of high-end key equipment in the aviation, railway, energy, medical and other industries. To put forward the concept of industrial Internet with such a status of rivers and lakes, it is natural to think carefully and move forward. On the one hand, the network industry has advanced by leaps and bounds in these years, and has already entered the hereditary territory of traditional industries. It is not the way for traditional industries to wait for the empty city to sit still; on the other hand, the advancement of technology and technology has prepared sufficient conditions for the great changes of traditional industries, such as Networking, cloud computing, WEB2.0, big data and other new waves are coming, and the innovative external environment has matured.
Perhaps because of the steady and heavy nature of large companies, GM adopted a more conservative approach in promoting the concept of industrial Internet. For example, with the GM's existing products and market size, as long as the introduction of the Industrial Internet, the efficiency of related equipment increased by 1%, in a decade, it can save hundreds of billions of dollars in expenditure for various industries. This is enough to prove that GM should enter the industrial Internet. Such an argument can be an elaboration of the basic industrial Internet concept. The problem is that it is not easy to distinguish it from the existing concepts of automation control, remote control and industrial control, a bit like the natural evolution of the industry.
GM further portrays the connotation of the extended industrial Internet concept, which promotes more advanced equipment and better service generation through the combination of equipment, the Internet and big data. Take the CT equipment used in hospitals as an example. If you have not only mastered the equipment operation data through the Internet platform, but also mastered the patient's patient data and doctor's diagnosis data, then you have the opportunity to produce more specialized equipment, and the equipment, patients and Doctors are connected in an orderly manner to improve equipment usage, patient care rates, and physician productivity, and to improve diagnostic accuracy through comprehensive data analysis combined with case comparisons. This will help reduce the cost of medical care and improve medical outcomes.
GM also outlines the notion of an innovative industrial Internet concept that introduces third-party innovators to create entirely new services and business models through the openness of platforms, networks and data. For example, after the medical diagnosis network is realized, it is possible to introduce a family-level disease diagnosis device, and the diagnostic data is uploaded to the doctor through the network, and the doctor-patient interaction is used to make suggestions or recommend special hospitals and doctors for further treatment. This will trigger a new home health care industry and a new range of health insurance services. Of course, this requires the establishment of a public platform and the establishment of relevant data standards and implementation guidelines, and the government should play a neutral and facilitating role in this process.
At this time, GE can propose the concept of industrial Internet, which reflects its sensitivity to the process of social development and its aggressiveness in transformation and upgrading. However, in the realization of this concept, it will inevitably be full of risks and challenges. Not long ago, GM invested $1 billion to acquire a company specializing in the digitization and networking of industrial equipment in Silicon Valley, in order to make up for the shortcomings of its own professionals and capabilities. However, the greater risks and challenges come from whether the core layer of the company truly realizes the revolutionary nature of the industrial Internet, and resolutely and completely eliminates the habitual thinking and path dependence of traditional equipment manufacturers, self-revolution and even self-elimination to achieve the goal. There is only one core problem: the use of the Internet in the traditional architecture is only an improvement. If you do well, you can only get improved results. Rebuilding the traditional industry on the Internet architecture is a revolution. If you do well, you can get excess returns. . The former is easy, the latter is difficult, how to choose?
In the history of the era of human society moving towards information, traditional enterprises have taken the lead in proposing revolutionary concepts and occupying favorable starting positions. As a result, there are many examples of latecomers. IBM was once the leader in the large-scale computer industry. It also saw the strategic opportunity of personal computers and led the way, but ultimately made Microsoft gain most of the benefits. The problem is that IBM sees personal computers as opportunities for device manufacturing, while Microsoft sees software as an opportunity. AT&T used to be the leader of the telecom industry. He also saw the strategic opportunities of the Internet and led the way. But eventually, Internet companies such as Google got most of the revenue. The problem is that AT&T sees the Internet as an opportunity for data transmission, while Internet companies see it as an opportunity for data services. Nokia used to be the leader in the mobile phone industry. It also saw the opportunity of so-called smart phones and led the way, but eventually it gave Apple and other companies a lot of revenue. The problem is that Nokia sees smartphones as communication terminals, while Apple sees them as data terminals.
A concept may be established by itself, but different people often come to different interpretations and practices from different positions, interests and perspectives, and the final results are very different. I remember that former General Manager of General Electric Welch told a story in his autobiography: GM had a monopolistic market share in the aircraft engine market. He asked the person in charge of the aircraft engine how big the market was and replied that it was tens of billions of dollars a year. Welch said that there is still any investment value, and it is necessary to redefine the market and include relevant training, parts supply and financing services. In this way, the market scale has expanded to hundreds of billions per year, but GM's market share has fallen to single digits. Welch believes that it is only worthwhile to expand investment. In his words, the industry with a monopolistic market share is not worth continuing to invest, and it is necessary to redefine the market. Only a market with a market share of only 1% is worth fighting for.
The concept of the Industrial Internet is a redefinition of the traditional equipment manufacturing industry, and the potential market size has expanded tenfold. In the Industrial Internet, equipment sales are still an important part of the business model, but the more important part is the value-added services and innovative services based on equipment. From selling equipment to selling services is a long and painful process for traditional equipment manufacturing companies. IBM has spent nearly two decades in the market to complete this transformation. Although Apple is leading the way, it is still suffering from transformation. GM puts itself in a position to re-enter. Whether it can be successful and become a universal in the era of the industrial Internet, clarifying the concept is an important first step, but it is only the first step.
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