The Potential impact of Information on the strategic direction of GE Healthcare

Executive Summary

This report analyses how Information and knowledge is managed in GE Healthcare. It discusses concepts of what an Intelligent Organization is and how ICT and Knowledge management is handled in Customer solutions process of GE Healthcare. Information transfer is critical in this process as Turnaround time (TAT) and Quality are important factors for the stability of the process. This process is a part of the supply chain management industry, where knowledge and information of the entire supply chain is important for the development of the process. The Strength of the chain is only as strong as its weakest link, so the weak points and bottlenecks of the process are looked into. The SECI model introduced by Nonaka and Takeuchi (1995), will be discussed. The use of IT is an important factor in the exchange of information, where Database management and use of Graphical User Interface software's are very important for the efficient running of the process. We shall look into the various strategies (Value chain, Alignment perspectives and Importance of place) as applied to GE healthcare for the process improvements. Issues it faces with Information handling and technology are also addressed. The barriers and promoters of the supply chain industry are looked into and finally a Conclusion and some recommendations are provided.


The intelligent organization will be able to mobilize the different kinds of knowledge that exist in the organization in order to enhance performance. It pursues goals in a changing environment by adapting behavior according to knowledge about itself and the world it thrives in. The intelligent organization is therefore a learning organization that is skilled at creating, acquiring, organizing, and sharing knowledge, and at applying this knowledge to design its behavior. Organizational learning depends critically upon information management, i.e. the capacity to control the organization's information resources and information capabilities to strengthen organizational growth. Information management is a cycle of processes that support the organization's learning activities: identifying information needs, acquiring information, organizing and storing information, developing information products and services, distributing information, and using information. "An analysis of each of these processes suggests new strategies for maximizing the value of information in organizations, and for a reinvention of the roles of information professionals, be they librarians, information providers, information technologists, or information scientists" (Choo, 1995).

Data, Information and Knowledge

Michael Earl (1988; 2000) suggested that it is necessary for organizations to use information strategy as a means to support their business strategy. Customer Solutions team is a part of Diagnostic Imaging in GE healthcare which deals with procuring medical parts for the hospitals. Whenever there is a problem with a medical part in the hospital, a GE Field Engineer is contacted. If the part cannot be repaired he would place a "Sales Order" with the Customer solutions team. The Customer solutions team receives the Order in the Oracle Live screens and follows' the triage process where they look into the GE warehouses for the parts availability. If there is no stock available they will try to find a replacement or a used/refurbished part. If none of these work out, they will source the part from an external supplier by placing a purchase order. An automated request is sent to the carrier service (based on the FE's decision) and the part is picked up from either the warehouse or the supplier and delivered to the Hospital in due time. The Order's have different "Customer Temperatures" based on the urgency. There are various carriers and shipment types based on the delivery requirements. Special handling shipments deal with same day delivery, while "FedEx Priority" and "Next best available" deal with the Next day delivery. For non urgent orders, "FedEx ground" is available which will transport the parts on ground and will take a five day delivery time period and is cost effective. So we see that there is a lot of information which is being transferred around. Customer solutions team also deals with answering FE calls to update them regarding the status of their Back Orders. Information transfer and Communication is critical in this process as its passes through various mediums and teams. Once the parts are delivered and are set-up in the hospital the Order is closed by "dropping a receiver" which will have the supplier payment sent. Daft and Weick (1984) suggest that we can locate organizational ways of knowing which they term interpretive systems against two sets of assumptions.

Organizations as interpretation systems

(Daft and Weick, 1984)

Based on the above figure, Organizations with Undirected Viewing have un-analyzable assumptions about the environment and passively intrusive into the market (E.g. SME's). Organizations with Conditioned Viewing have analyzable assumptions about the environment and are passively intrusive (E.g. Public sector Org's). Enacting Org's have un-analyzable assumptions about the environment but are actively intrusive (E.g. Google, Skype, Sony, Apple). Discovering Org's have analyzable assumptions about the environment and are actively intrusive into the market (GE falls into this bracket). They have a formal search, questioning, surveys, data gathering and active detection of information.

The efficient running of a service organization is based on the feedback received by the Customer or the Client. There is the need to provide information rather that data, by actively taking into consideration the end user needs (Mutch, 1999). This is done by taking various surveys' with the customer's and using this information for the betterment of the process. The accuracy of the information received in these surveys is based on the right questions being asked. The Customer loyalty team is a dedicated team in GE Healthcare for taking survey's with Clients to improve its service quality. A lot of research is done in improving these survey's as maximum information has to be acquired from the minimum questions being asked. The very busy clients generally do not find the time to keep answering survey's, but they are made to understand that these survey's are only a means to improve our service for their organization. There are various modes of Data Collection which include Telephone, mail and online surveys. The information gathered is sent to the "Analysis team" which in turn converts the scores to theory and sends the "Improvement strategy" to the various teams across.

ICT and Knowledge Management

Information and communication technologies (ICT), allows users to participate in a rapidly changing world in which work and other activities are increasingly transformed by access to varied and developing technologies. By this definition, you could almost say ICT is technology's version of economic growth, to satisfy the needs and wants of the community over time. ICT is also a very age friendly mechanism.

ICT tools can be used to find, explore, analyze, exchange and present information responsibly and without discrimination. "ICT can be employed to give users quick access to ideas and experiences from a wide range of people, communities and cultures" (Walsham, G 2001).

Knowledge management (KM) comprises a range of practices used in an organization to identify, create, represent, distribute and enable adoption of insights and experiences. Such insights and experiences comprise knowledge, either embodied in individuals or embedded in organizational processes or practice.

"An established discipline since 1991 (see Nonaka, 1991), KM includes courses taught in the fields of business administration, information systems, management, and library and information sciences" (Alavi & Leidner 1999). More recently, other fields have started contributing to KM research which include information and media, computer science, public health, and public policy.

"Many large companies and non-profit organizations have resources dedicated to internal KM efforts, often as a part of their 'business strategy', 'information technology', or 'human resource management' departments" (Addicott, McGivern & Ferlie 2006). Several consulting companies also exist that provide strategy and advice regarding KM to these organizations.

KM efforts typically focus on organizational objectives such as improved performance, competitive advantage, innovation, the sharing of lessons learned, and continuous improvement of the organization. KM efforts overlap with organizational learning, and may be distinguished from that by a greater focus on the management of knowledge as a strategic asset and a focus on encouraging the sharing of knowledge. "KM efforts can help individuals and groups to share valuable organizational insights, to reduce redundant work, to avoid reinventing the wheel per se, to reduce training time for new employees, to retain intellectual capital as employees turnover in an organization, and to adapt to changing environments and markets" (McAdam & McCreedy 2000) (Thompson & Walsham 2004).

The SECI Model in GE healthcare

Mintzberg (994) states that, Managers scan their environment, they monitor their own units, and they share with and disseminate to others considerable amounts of information they pick up. A point worth emphasizing in almost every serious study of managerial work is that the formal information does not particularly play a dominant role here. Oral information and even non verbal information, forms a critical part of every serious managerial job.

(Nonaka, 1991)

Being a process trainer for the Customer solutions team, I have encountered how new employees tend to learn a lot about the organization and the process through Tacit and Explicit forms of knowledge.

Tacit - Tacit through socialization - At first the new employees generally understand a lot of procedures, styles, jargons and methodologies of an organization though tacit knowledge and socialization. Starting from simple things such as how to use a fax machine to complex activities of working on software's while on a customer call are quickly picked up through socialization and interaction.

Tacit - Explicit through Externalization - This is where my role as a process trainer comes in when a lot of questions are thrown at me about "Why this" and "Why that". The newly hired employee's gain a lot of information though tacit knowledge but this knowledge gained is still unclear to them. They have to assemble all the pieces of info to make it a solid picture of understanding. When these mysteries are explained to them it all starts to make sense.

Explicit to Explicit through Combination - Process training is generally Explicit to Explicit where theory of how the process works in explained in a conference room. For the new employees, it all seems interesting like a history lesson until they hit operations. Explicit knowledge sharing is very important as it's the best means of making people understand the basic concepts of work. Henceforth even the education system is a form of Explicit to Explicit knowledge transfer where practicalities are looked into only in the later part of life.

Explicit - Tacit through Internalization - This is the final stage of the cycle, where the explicit knowledge gained in converted into practical working. The working on different software's and tools for the effective running of the process becomes very simple for the agent as he gains the tacit experience.

Value Chain for Customer Solutions

The value chain is a systematic approach to examining the development of competitive advantage. It was created by M. E. Porter in his book, Competitive Advantage (1980). The chain consists of a series of activities that create and build value. They culminate in the total value delivered by an organization. The 'margin' depicted in the diagram is the same as added value. The organization is split into 'primary activities' and 'support activities. (Marketing teacher website, 2009)

(Porter, 1985)

Primary Activities

Inbound Logistics

Here goods are received from suppliers to GE warehouses based on demand forecast. They are stored until they are needed on the production/assembly line. Goods are moved around the organization for Order fulfillment.


This is where Orders are received on Oracle live screens and based on availability; parts are released from warehouses against these Orders. If there is no stock in the warehouses, alternate options such as replacement parts or used/refurbished parts are looked into. If none are available, parts are sourced from a 3rd party supplier.

Outbound Logistics

Once the parts are sourced, they need to be delivered to the Hospitals. Carrier services such as FedEx, BAX Global, AirNet, Sonic etc are contacted for the pickup and delivery.

Marketing and Sales

In true customer orientated fashion, at this stage the organization prepares the offering to meet the needs of targeted customers. This area focuses strongly upon marketing communications and the promotions mix.


This includes all areas of service such as installation, after-sales service, complaints handling, training and so on.

Support Activities


This function is responsible for all purchasing of goods, services and materials. The aim is to secure the lowest possible price for purchases of the highest possible quality. They will be responsible for outsourcing (components or operations that would normally be done in-house are done by other organizations), and ePurchasing (using IT and web-based technologies to achieve procurement aims). GE outsources its business to India and the IT systems used include Oracle, Mainframes, DBMS, Siebel, Cognos and Ms Office.

Technology Development

This function is responsible for all purchasing of goods, services and materials. The aim is to secure the lowest possible price for purchases of the highest possible quality. They will be responsible for outsourcing (components or operations that would normally be done in-house are done by other organizations), and ePurchasing (using IT and web-based technologies to achieve procurement aims). GE outsources its business to India and the IT systems used include Oracle, Mainframes, DBMS, Siebel, Cognos and Ms Office.

Human Resource Management (HRM)

Employees are an expensive and vital resource. An organization would manage recruitment and selection, training and development, and rewards and remuneration. The mission and objectives of the organization would be driving force behind the HRM strategy.

Firm Infrastructure

This activity includes and is driven by corporate or strategic planning. It includes the Management Information Systems (MIS), and other mechanisms for planning and control such as the accounting department.

The strategic alignment of GE healthcare is that of Technology Transformation where the strategy depends on changes in technology which place the focus on aligning technology infrastructures.

(Lecture Slides)

(Own work based on Lecture Slides)

Customer solutions and the Asset management are two teams which work for GE Healthcare. The agents of Customer solutions are represented by the blue squares in the above figures while the agents of the Asset management team are represented by the red triangles. In Fig 1, when the two teams had been placed separately there were a lot of unresolved issues in the process. In Fig 2, when the two teams were placed side by side there was a lot of information and best practice sharing which resulted in various process improvements and lean ideas.


Level          Features

Data          Daily updates on prices of parts, non-releasable          parts/warehouses etc

Software          Process mapping and monitoring, automatic          allocation of tasks.

Hardware          Client server network.

During the first two years of my work at GE Healthcare, I had an opportunity to observe and work with the existing system being used. The process had a lot of updates. I have always been in touch with the latest software's (thanks to my college education and the powerful PC I have at home) and am quite used to working with a Graphical User Interface (GUI) environment. At the office, there was great deal of chaos as the process updates were almost on a daily basis and usually posed a problem. The difficulty we faced was the number of error's which were taking place and henceforth a decline in team credibility.

I recognized that establishing a common webpage would not only dramatically improve our documentation quality, but also increase productivity at the workplace. Presenting the pros and cons to the management of the development of this tool was a very challenging task. I was asked to prepare an Html webpage for the easy understanding of the latest updates. Initially, I imagined this project would be rather simple but it turned out to be among the most challenging and rewarding experiences of my life.

Through a firm-wide survey of agents and several one-on-one discussions of their own preferences and solutions, I found that while everybody wanted a common tool, I realized the necessity of a training course for the agents because most of them were not familiar with the GUI interface. I examined the various training classes that offered private in-house trainings for the employees. After a detailed analysis, I presented my report to the management in the next meeting.

Once I was given the go-ahead, the next hurdle was to implement the proposal and coordinate the web tool. To avoid any disturbance to the company's work, training sessions were planned after working hours. The upgrading took a week and the training of the agents took another two weeks. The management felt that it was my responsibility to see that the agents didn't face any problems once they actually started using the new tool. I put in long hours for the next three weeks before everyone was comfortable with the new system. While the benefits of using these tools were not immediately tangible, a few months later our clients acknowledged that the quality of the work had improved considerably.

Barriers and Promoters

GE healthcare has its branches and warehouses at various parts of the world. One of the primary barriers' to the effective flow of information is the language and cultural differences. As the head office in Milwaukee, Wisconsin makes primary decisions on process changes, the information has to be transferred to its counterparts in France, China, and India. Due to some technical terminologies not translated in the right way there is discrepancy in the quality of information transferred.

Promoter's for the business is that GE has monopoly in the US healthcare industry and very few competitor's. Apart from that the reputation for the quality of service provided by GE has been unbeatable. Moreover, due to GE being a global company and having warehouses across the world, it has the ability to ship parts in the fastest means possible. The distribution of the medical parts is based on the requirement of parts in various locations of the world. This information is collected by the historical data available and the forecasting based on demand.

Conclusion and Recommendations

One of the primary recommendations for the process is that the various branches across the world do not work on the same GUI's. The American team in Wisconsin, European teams in England and France and Indian teams in Gurgaon and Hyderabad use Oracle as their Order sourcing software while the Chinese team in Beijing continues to use Mainframes and Native-Oracle in which the Order processing time is almost the double of the earlier. One of the main problems is shifting to Oracle is the transfer of the database which is Cost and Time consuming. This cannot be done at this point of time because the process transactions have to be put on hold for the transfer. This will cause an imbalance on a Global scale. This is causing a bottle neck in the process which is slowing down the entire activity. An I.T solution or an alternate platform for order processing must be discovered for continuation of the process activity while the transfer of the database takes place. This transfer is required as information flow will be a swift even flow when all the branches are using the same tools.

Another recommendation is that every Newly Hired Employee has to go through the entire process training before hitting production. This will minimize the number of error's which can take place. Generally, due to the high volumes of work, every newly hired employee is put into production before the training is complete. The transfer of explicit information is very important before the agent hits production. Quality can be assured with this and there will be no need for Quality control and re-trainings.


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