Ge - Energy Management Initiative

GE

Among the Top 10 industrial corporation

1980 Jack Welsch Ð'- CEO

Simplified and decentralized corporate structure

54 Ð'-business corporation reduced to 13

Layers of management and corporate planning department were eliminated

Autonomous divisions

New driver: empowerment and customer focus

Work-Out program

Non-US operations

Integrated organizational model Direct-connect (detail)

Local managers responsible only for unique local issues

Looking for opportunities to leverage local strengths on a global basis

ESCo Industry:

Energy Efficiency

Covered the multitude of ways that energy could be optimized, including conservation, use of efficient appliances and off-peak usage.

Resurfaced due to the environmental movement and the increasing need for cost competitiveness in the late 1980s.

Utility-sponsored programs -> formation of many ESCos (Energy Service Companies)

High-demand -> rapid growth ($80m revenue growth in 3 years)

Three major segments:

Commercial: office buildings, hospitals and other public buildings

Industrial: factories and production plants

Residential: single-family dwellings

ESCo Strategies:

Energy audits on client sites.

Engineer and provide access to hard-to-get Energy Efficient technologies.

Install new Energy Efficient equipment under Performance Contracts: ESCO installs energy-efficient technologies at no upfront cost to client. Cost would be recouped from savings realized.

GE