In an exclusive interview with Automation World Editor in Chief Gary Mintchell, GE Fanuc Chief Executive Officer Jeff Garwood discussed where the company is heading.
Automation World: You are relatively new to the automation industry. Can you give us some personal and company background?
Jeff Garwood: I have a chemical engineering degree plus a master of business administration. After a stint as a project engineer and McKinsey consultant, I joined GE in 1991 and held various positions. I was named CEO at GE Fanuc in 2003.
During my two years with GE Fanuc, I’ve seen a transformation of the business from the product focus it has had since its inception as a joint venture between GE and Japan’s Fanuc. By the way, it is the longest standing joint venture for GE. The reason for the success is the structure—both parents get good returns and each has a good say in the business.
Jeff Immelt (GE’s chief executive officer) says to focus on what your customers need—whether components or applied solutions. The important thing is how we approach customers. We’ve had a good focus on applying the right technology driven by the needs of our customers.
AW: There have been a few high profile defections from GE Fanuc over the past year. Has this had any impact on the organization or your business?
Garwood: Our internal organization shouldn’t matter as long as it drives productivity for our customers. Some good people have left, to be sure, but beyond that, we have also reorganized over the past two years and removed a lot of clutter that was in the way of making decisions. We’ve moved to make acquisitions. While we focus on product development, we believe that the sales team and others who touch customers should tell us what directions we need to go in developing new products. We’ve seen some pretty strong growth recently with some nice returns.
AW: What are some of the new directions coming from Jeff Immelt, who recently took over from the legendary Jack Welch?
Garwood: Make commitments [and keep them]. The “say/do” ratio is important at GE. We still focus on doing things efficiently and effectively, as in the Welch days, but we now also strive to get technology and technological synergies into the forefront of leadership. We focus on how best to reach out and touch customers.
Some people think that the difference between Welch and Immelt is cost vs. growth—one or the other. Actually, [with Immelt], it’s kind of both.
AW: What about product development goals?
Garwood: Our direct, line-of-sight focus on market segments is leading to success now. It’s listening to the voice of the customer. We’re seeing growth across almost all our segments. We are pleased with the reception and orders for the new Proficy Suite of software applications. Our product development investments have been spot on to improve the speed of implementation. Merging data into knowledge faster is what we’re up to in our software developments. The second focus is in VME-bus computers. We are continuing to build this platform, as well as customizing for specific customers who are in the military, telecom and general industrial markets. We’ve made a couple of acquisitions to strengthen the PAC (programmable automation controller) line and growing the PLC (programmable logic controller) side of the business with input from embedded technologies.
AW: Any changes in your marketing channel?
Garwood: When I came in a couple of years ago, I learned that our channel was great, but that it needed to be supplemented with direct sales. Our direct sales team is devoted to getting our products recognized, as customers and prospective customers develop specifications for new projects. It became clear that two different skill sets were required in the sales team—channel management and customer focus. In addition, no one person can be an expert in all areas of automation, so we’ve developed a knowledge directory accessible by application ability or vertical industry ability. For example, if a sales person goes into a customer site and the customer wants to talk about material handling, that sales person can look up a directory of white papers we have on the topic, as well as access the right people to help.
