GE Named E-Business of the Year

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InternetWeek recognizes manufacturer for its e-business models.

August 29, 2000

The leading Internet/IT magazine in the nation has named General Electric the leading e-business in the nation, and there are homebuilders that agree. What garnered the manufac-turing giant such media acclaim is also what has been turning builders' heads: quality online sales, service and support, and a cost-cutting strategy which gets passed down to their consumers.

In their first of what will be an annual "InternetWeek 100" article naming the top e-businesses in ten major industry sectors, the magazine named GE its "E-Business of the Year." The magazine cited the company for using the Internet to broaden its customer base by 7%, source 20% of its strategic suppliers, transact 10% of its purchase orders, and cut materials procurement costs by nearly 10%. Perhaps the most impressive number is the company's 73% perfect order rate (orders that are fulfilled accurately, on time and in the right quantity). This praise will only serve to elevate GE's reputation, which is what brought many builders to order appliances from CustomerNet, one of GE's 20 business units.

"We were looking for a way to better our ordering and purchasing practices," says Timothy Jed, director of purchasing for the Fairfax, Va. division of Richmond American Homes, which also has an office in Denver. "We chose GE in large part because of its name and reputation, and we are very happy with the results."

Jed points to easier communication between trades and between the field and the office as a major benefit. Change orders and upgrades are handled quickly and efficiently through e-mail, and replacement part numbers and point-of-sale materials are all available online.

"We never have a backlog of appliances laying around anymore. CustomerNet has really helped us streamline our purchasing process and control our inventory," says Jed.

The magazine article directly pointed to the fact that GE is capitalizing on its Internet strategy (which wasn't even implemented until 1999) to drastically cut operating costs, and those savings will be both invested into new initiatives and passed down to consumers. Jeanne Terrile, a financial analyst at Merrill Lynch, is quoted in the article as saying GE is "using the Internet to eliminate paperwork and run operations a lot more efficiently." The company predicts it will be able to cut costs by as much as 50% over the next two years, which could amount to $10 billion savings.

Jed says that while he has realized savings from ordering online through GE, it is Richmond American's own savings on overhead that has most impressed him and his company. His division is the first to use CustomerNet, but he says the site will be used company-wide very soon.

"CustomerNet allows us to pay our bills earlier and get our invoicing running very smoothly," says Jed. "The system takes a little training time to get used to, but that cost is more than made up for in a short time."

More information about GE CustomerNet can be found at HousingZone.com (keyword: CustomerNet), or at https://customernet.geappliances.com/CustomerNet/. A copy of the Inter-netWeek article can be found at http://www.internetwk.com.

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