GE has been applying lean startup principles across its global operations to increase innovation speed and reduce product development cycles. It spends $5 billion annually on R&D through its 50,000-person global research network. In 2012, GE invited Eric Ries to teach its lean startup methodology called FastWorks. FastWorks focuses projects on short learning cycles, customer validation, and dedicated cross-functional teams. This has helped GE release new products in 6 months rather than 6 years by conducting numerous MVP tests to refine offerings. Examples include a gas turbine developed through 4 MVPs in 2 years and a medical C-arm created via 11 MVPs in under 6 months. GE also established training, resources, and cultural changes to fully implement FastWorks

1. Lean Practices

2. About GE
est
1892
co- founder Thomas
Edison
Fortune 500 # 4
Employees > 300k
Revenu > $100B

3. Global Research Center founded in 1900
“Innovation in great technology is the heart of a great industrial company”
GE reverse innovation: innovation in developing countries instead of
developed high concurent
Historical approach to innovations

4. Innovations today
Spending $5B/year on innovation
Global Research Center employs 50k engineers
Placing R&D centers in different counties and cultures to grab the best
people
Inviting Eric Ries and lean startup principles (in 2012) and introducing
FastWorks

5. Lean startup principles applied to global company
1. Get closer to customer
2. Increase chance of success
3. Increase speed to market
4. Make it easier to get things done
Rejecting process complexity (spread teams focused on activity) in favour of
simplicity (dedicated teams focused on learning)
FastWorks idea

6. FastWorks idea
Salespeople give design requirements and customers would be involved
throughout.
“With FastWorks we learned that SPEED - our competitive approach”

7. Training leaders and teams
Team of 150 trained coaches
Launched 100s of FastWorks projects
Launched growth boards that allocate resources
FastWorks implementation

8. FastWorks Implementation aspects
Switch expected tons of money for periods of years to secure funding for
short periods
Justifying programs to make people feel confident about their jobs
Dedicated team, not scattered all around the place
Changing culture: from understanding that “everything should be perfect
from top to bottom” to “change in an inevitable thing in the business”

9. FastWorks challenges
a) SUPPLIER RELATIONSHIP - suppliers should be engaged sooner in the
product development, were grateful to be asked to be involved, and have
provided more flexibility.
b) FINANCE - required rethinking as teams speed up, it is hard to put dollar
value to the learning. Traditional financial systems are risk mitigation tools,
and there is typically no weighting on speed.
c) LEADERSHIP ROLES AND RESPONSIBILITIES - they inverted pyramid and
research and development team moved leadership even faster then CEO.
d) EDUCATION FOR MIDDLE AND TOP EXECUTIVES, for Lean and FastWorks
approach

10. Case: Series X diesel engine
product release in 6 years
After talking to Eric - series of MVPs,
first – in 2 years

11. Case: Multiphase Flowmeter
Need: super precise meters
adapted existing technology
Internal startup that grew to a
$100M business

12. Case: 500 MW Gas Turbine (2012)
7 years and $500M for first plant (to be built
in 2019)
short development cycle
tricked existing turbines with little
engineering to performs 10% better
Then added more engineering and achieved
+22%
Released 4 MVPs, first in 2015, final in 2017
Put GE in “high-efficiency power” space early

13. Case: C-Arm (healthcare stuff)
First lab mockup in 3 weeks
Got customer feedback
Sold 4 pieces during first weeks
11 MVPs
Released new product in < 6 months

14. Case: Industrial circuit breaker
Reduced typical to this industry 60
month development cycle to 30
month
7 MPVs
20 customer sessions

15. Case: Silicon Carbide Power Semiconductor
Totally new internal startup
that will effect all GE
businesses
$250M of investment

16. Conclusions
Slides has been made in scope of course “Innovation Management” | MSIE4 | LvBS | 2016
You can ping our team via prokopenko.serhii@gmailcom
Sources:
Video (12:43): Mark Little, GE’s Chief Technology Officer and Leader of GE’s nine Global
Research Centers Lean Startup at GE, LSC15
https://www.youtube.com/watch?v=TgAk7xP2a1M&index=2&list=PL1M9pu1POlekMxS-
EKorIuuO_JynFHQRm
Video (58:27): Johanna Wellington, GE–Fuel Cells: Running a Lean Startup Inside a Big
Corporation, LSC15
https://www.youtube.com/watch?v=FS07NcNdBn8&list=PL1M9pu1POlekMxS-
EKorIuuO_JynFHQRm&index=31
And a lot more