General Electric outfitted 650 British Petroleum (BP) oil wells with systems that allow the rigs to report operational data to a central GE platform. The data is used to optimize how the machines run; so far BP and GE have created a 2 to 4% efficiency improvement, according to GE CIO Jim Fowler.
It may not sound like a lot, but Fowler said just a 1% global improvement in well production could create a $90 billion offset of capital spending in the energy industry.
In a world of connected machines, advanced analytics and powerful software platforms, Fowler says GE is approaching a new era, and the BP oil wells are a prime example. “Machines are telling people what to do more than people are telling machines what to do,” Fowler said at the fall meeting of the Open Networking User Group (ONUG) this week in New York. Sensors and integrated software generated the data needed to create those efficiencies, he says. He calls this the merging of information technology and operational technology to create value.
Machines that run these advanced systems can self-diagnose problems, which can speed maintenance and reduce downtime. GE uses this approach on its Field Vision app, which is used by gas-turbine and medical-imaging equipment production workers. The machines report diagnostic data to a central hub and if a part needs to be replaced, the system automatically starts a supply chain process to order it. Fowler calls the process the next evolution of enterprise resource planning (ERP): machine resource planning (MRP). When field workers arrive on-site to fix a machine, they already have the needed part and spend their time fixing the problem rather than diagnosing it.
“[Artificial intelligence] is being used to determine 75% of the work scope,” of many repairs he says. “We know what parts to bring, what skills are needed. We have the full bill of materials, the machine’s plans and past maintenance record.” GE is hoping this could save $2.5 million this year.
GE is also making this technology available for its customers as part of the GE Digital brand. Goals include better uptime of customers’ systems and higher operational throughput. “The idea is to let our customers get more value out of the products they already own from us,” Fowler says. That could eventually generate $10 billion in revenue for the company, he says.
The cloud plays a big role
In addition to using machine-based data to help improve operations, the company is also diving deep into using the public cloud to power many of these projects. GE has built a software platform named Predix that acts as the main central hub for much of this innovation. Predix runs on both a private cloud that the company hosts, and it also uses public cloud resources, including Amazon Web Services and Microsoft Azure. Fowler says his goal is to cap the use of on-premises resources and build any new applications in the public cloud. He noted public cloud is less expensive for GE than the company’s existing infrastructure; although he admitted not all companies will come to that conclusion. Fowler estimates 40% of the company’s infrastructure is in the public cloud, and, "We’re going to grow that as far as we can.”
Changing GE starts from within
Instituting these practices across GE has not happened overnight, Fowler says, and it’s been part of a broader effort within the company to use software and other technology to aid the business. One key to implementing this strategy, Fowler says, has been breaking down traditional vertical management structures to create more shared horizontal software platforms. The Field Vision app, for example, is used by both the gas turbine and the medical imaging units, whereas in the past those may have been separate groups within the company each working on their own version of a similar resource. Workers are also encouraged to become multi-disciplinary and professional development training is built into workers’ schedules, Fowler says.