GE as digital firm
...chasing cycle from 14 to 7 days and it reduced supplier prices by 10 to 15%. Polymerland, on the other hand, used the Internet to distribute technical documentation over the Web and it placed its product catalogue on the Web in 1996. In1997 it established a site for online sales. Senior management saw that by using the Internet, they could not only save money, but also expand the business. Their CEO stated, that by Internet-enabling its business processes, GE could reduce overhead costs by half, saving as much as $10 billion dollars during the first 2 years. Part of this statement was based on the success of Polymerland, which boosted weekly sales from $10 000 in 1997 to $6 million in 2000. The objective to reduce costs gave GE two options: they could sell products at a reduced rate, without losing their profit margin or they could sell products at the existing rates, resulting in increased profit margins. Another reason for the Internet initiative, was to obtain a competitive advantage over their competitors. This was something that GE wanted to exploit, because it was evident that the Internet was creating excellent results for GE Lighting and Polymerland, hence the decision to transform other units within the GE group. With respect to technological issues, Polymerland had essentially achieved supply chain management, with their Web initiatives. Aft...