Although it doesn’t get the same press as Boeing and its new 787 “Dreamliner,” there is another U.S. aviation success story taking place over at GE. As superbly described in a recent story in Aviation Week, the company’s aviation division, based in Evendale, OH, is enjoying booming sales of its new, large GE90 and GEnx engines, which are used in the 787 and the latest version of the 747. This comes in addition to continued strong sales of the midsized engines that have boosted profits at GE for more than a decade. According to Aviation Week, GE now has some 800 orders for its GEnx engines alone, which cost about $12 million each.
What makes this success so satisfying is the fact that it didn’t come by accident, but was the direct result of hard work, effective market analysis and the willingness to invest money to make money-the willingness to take a risk. The company didn’t just ride some existing wave of popularity or tap into the trend du jour. Instead, it set out to identify what the needs of the market would be years down the road and then develop the technology and products to fill those needs.
Like Boeing, which set out on the path that has resulted in the soon-to-launch 787 back in the early 1990s, GE’s current success began with a commitment to a new product line well over a decade ago. In the process it invested billions of dollars to develop the engines that are now filling up the order book. Also like Boeing, GE is taking a serious look at its assembly practices, developing lean manufacturing processes and taking a closer look at issues like design-for-assembly. As a result, like Boeing-or Toyota for that matter-GE will likely be able to translate these evolving best practices into continued, long-term success.
In recent years, ASSEMBLY magazine has provided a good deal of editorial coverage to the aerospace sector. The magazine has done so for a number of reasons, not least of which is the fact that companies like GE and Boeing serve as a reminder that American drive and know-how are not yet dead. On the contrary, they are still winners even when stacked up against some of the toughest competitors in the world.
We believe that other American companies will see Boeing and GE’s success and think twice before simply giving up on themselves and reflexively shipping jobs overseas. This is not to say there isn’t a place for outsourcing or that a global supply chain is a bad thing-few companies are more global in their outlook and practices than Boeing and GE. Nonetheless, companies should think long and hard before moving ahead with layoffs and plant closings in the United States to make sure they aren’t cutting muscle as opposed to fat. For one thing, outsourcing is hardly the panacea many of its proponents would have manufacturers believe. For another, doing so means wasting this country’s two greatest natural resources, its creativity and ingenuity.
Like Boeing, which set out on the path that has resulted in the soon-to-launch 787 back in the early 1990s, GE’s current success began with a commitment to a new product line well over a decade ago. In the process it invested billions of dollars to develop the engines that are now filling up the order book. Also like Boeing, GE is taking a serious look at its assembly practices, developing lean manufacturing processes and taking a closer look at issues like design-for-assembly. As a result, like Boeing-or Toyota for that matter-GE will likely be able to translate these evolving best practices into continued, long-term success.
In recent years, ASSEMBLY magazine has provided a good deal of editorial coverage to the aerospace sector. The magazine has done so for a number of reasons, not least of which is the fact that companies like GE and Boeing serve as a reminder that American drive and know-how are not yet dead. On the contrary, they are still winners even when stacked up against some of the toughest competitors in the world.
We believe that other American companies will see Boeing and GE’s success and think twice before simply giving up on themselves and reflexively shipping jobs overseas. This is not to say there isn’t a place for outsourcing or that a global supply chain is a bad thing-few companies are more global in their outlook and practices than Boeing and GE. Nonetheless, companies should think long and hard before moving ahead with layoffs and plant closings in the United States to make sure they aren’t cutting muscle as opposed to fat. For one thing, outsourcing is hardly the panacea many of its proponents would have manufacturers believe. For another, doing so means wasting this country’s two greatest natural resources, its creativity and ingenuity.
