Roger Gasaway - PIMA

84th Annual International ManagementConference – PIMANew York City, New YorkJune 29 – July 2, 2003-- Benchmarking Successful Companies –Roger Gasaway – GE Industrial SystemsLessons to Be Learned Across Sectors

Roger GasawayVP Manufacturing• GE Industrial Systems Four Global Business In 100+Countries – 40,000 Employees Global Energy, Automation,Security, and Sensors

Elk Grove City CouncilJuly 27, 2011Page 3 of 5contract their bid bond will be forfeited and Biondi Paving (the next lowestresponsible bidder) may instead be awarded the contract.Construction is scheduled to begin after execution of the contract. Thecontract allows 20 working days to complete the required work.ENVIRONMENTAL REVIEW:The California Environmental Quality Act (Section 21000, et seq. of theCalifornia Public Resources Code, hereafter CEQA) requires analysis ofagency approvals of discretionary “projects.” A “project,” under CEQA, isdefined as “the whole of an action, which has a potential for resulting ineither a direct physical change in the environment, or a reasonablyforeseeable indirect physical change in the environment.” The proposedProject is a project under CEQA.Staff has reviewed the Project to determine the required level of reviewunder CEQA. The proposed project is exempt from CEQA pursuant toState CEQA Guidelines (Division 6 of Chapter 3 of Title 14 of the CaliforniaCode of Regulations) Section 15301(c) (Existing Facilities). Thisexemption applies to minor alteration of existing public or private facilitieswhen the alteration involves negligible or no expansion of an existing use.The Project consists of a new six foot wide sidewalk and asphalt pavementto improve pedestrian safety and ADA accessibility. The Project will beconsistent with the City of Elk Grove General Plan. The proposedimprovements will include minor alteration of an existing right-of-wayinvolving no expansion of existing uses. No trees will be removed. Noother special circumstances exist that would create a reasonable possibilitythat the Project will have a significant adverse effect on the environment.Therefore, this project qualifies for the identified exemption and no furtherenvironmental review pursuant to CEQA is required.A Notice of Exemption for this project was filed with the SacramentoCounty Clerk Recorder on September 13, 2010.FISCAL IMPACT:The current total Project budget is $150,000. All remaining project costshave been budgeted within the Fiscal Year 2011-12 Budget. All project3

THIS ISGE INDUSTRIAL SYSTEMSWho We Are!!

THIS ISa businesswith anoutstandingheritageWe Are A:•Global Energy Mgt.•Automation•Security•Sensors• 4 globalbusinessesoperating inmore than 100countries• 40,000employeesworldwide• $6.3 billion inrevenuein 2002• Nearly 8,000patents

THIS ISa globalbusiness withbreadth andreachNorth America $4.5B29500 EmployeesEurope $1.0B5200 EmployeesSouth America $0.3B1500 EmployeesAsia $0.5B2200 EmployeesOver one-third ofGEIS revenuescome from outsidethe U.S.‣ Operations in over 100 countries‣ 130 Manufacturing facilities in 50 countries

% Changeindustrial & construction 2000 market4.7%Industrial Production2001 2002 20031.9%THIS IS(3.5)% (0.7)%Continued economicuncertainty% ChangeStrong Decline in Commercial2000 2001 2002 2003Slight IndustrialRecoveryCommercial declineslowing.3.4%(7.2)%(19.0)%(5.8)%

THIS ISnewproducts,innovation isour futureSince 2001 we have:• Increase Product DevelopmentHeadcount by 76%• Increase New Product Spending 42%Never before havewe invested somuch for so manynew products.It’s all aboutprofitable growth.• Completed 16 New AcquisitionsProductivity Is Our Growth Enabler

THIS ISProductivity is defined asThe Game ...the optimum utilization ofall business resources toGetting More for Lessproduce customer value.

THIS ISThe GE vision of Competitiveness . . .“Productivity, more than anyother factor, will decide whowins and who ends up in thedustbin”Larry Bossidy. . . Is to Be Delivering More ProductivityThan Anyone Else

OM Trend With and Without TCPWhyTHIS IS$MM1997 1998 1999 2000 2001 2002• Competitors Protecting Share• Tough Markets …. Price Down $130 MMContinued … To a Strong Business Results Going Thru Out Tough of BusinessEconomy

Current EnvironmentTHIS ISEconomic Realities. . .• Capital Spending Still Weak• Over Capacity in Markets We Serve• Competitive Pressures . . .VolumePrice. . . Productivity Determines Success

THIS ISProductivity Approach• Cost Out Process• Major Initiatives

Cost Out ProcessTHIS ISHowPlanningExecutionCost OutResults

Cost Out ProcessTHIS ISPlanningPlanningCost OutExecutionResults• Expectations … Start With the Answer• Idea Generation … Everyone Engaged–Attack Waste, Competitive Analysis• Segmentation … Accountability

Cost Out ProcessTHIS ISExecutionPlanningCost OutExecution• Funding CriteriaResults–1 Year Payback, High Say/do Ratios• Project Planning … Details, Details, Details• Pulsing … Frequent and Detailed

Cost Out ProcessTHIS ISPlanningExecutionResultsCost OutResults• Reporting– Enough Detail to Surface Issues• Benefits … Tied to Ledger• Reinforcement– Plant Salary Plan Tied to Results

Cost Out ProcessTHIS ISVCP %5.04.03.02.01.01.9%2.7XImpr.5.0%‘93 - ‘95‘96 - ‘03Old MethodNew MethodStart With the Answer … Detailed Projects … Tie to Ledger

Cost Out InitiativesTHIS IS

Labor ProductivityLaborTHIS IS• Low Cost Region ManufacturingLaborMat’l• Lean ManufacturingFixed & OtherOverheadCost42%% LCR53%60%63%‘96 ‘98 ‘01 ‘03

Base/Fixed C&B ProductivityTHIS ISFixed & other Overhead CostsLaborFixed & OtherOverheadCostMat’l• Digitize Back Room• Leverage LCR• Rate and Usage

SummaryTHIS IS• Volatile Economic Conditions• Cost Out … 1.5X Price Decline• Process Rigor• Key Initiatives• Protect customersProductivity … the Fuel for Our Growth

Thank You