From the Desk of Jack Healy

GE’s Relocation Will Have a Big Impact on Massachusetts

Jack Healy – A Voice for Manufacturing in Massachusetts

By Jack Healy, President and CEO, MassMEP
[email protected]

Thanks to the combined marketing efforts of Governor Baker and Mayor Walsh, and their respective staffs and members of the business community, General Electric has selected Boston’s Innovation District as the location of their worldwide corporate headquarters. This decision came after a very public initiative that started back in June 2015, when GE Chairman and CEO Jeff Immelt first notified employees that GE would be looking to relocate it’s HQ and subsequently reviewed the feasibility for such a relocation with approximately 40 different cities across the country.

On January 13, 2016, Immelt confirmed his decision, stating, "Today, GE is a $130 billion high tech global industrial company, one that is leading the digital transformation of industry. We want to be at the center of an ecosystem that shares our aspirations. Greater Boston is the home of 55 colleges and universities. Massachusetts spends more on research and development than any other region in the world, and Boston attracts a diverse, technologically-fluent workforce focused on solving challenges for the world. We are excited to bring our headquarters to this dynamic and creative city."

While the economic benefits of GE’s decision may be Boston-centric, the announcement by the 8th largest Fortune 500 enterprise with the renown of GE, declares that they are leaving the current corporate location of 42 years because of "significant and retroactive tax increases." That GE is moving to Massachusetts goes a long way toward removing the "Taxachusetts" label that our state has been unfairly saddled with for so many years. Immelt was quoted as "looking for long term financial stability in a state," and he found it in Massachusetts. Given the desire for long-term fiscal responsibility, we should expect that GE will actively promote the need for continued good fiscal management at the state level, which could be a lasting benefit for all of the citizens of our state.

Another outcome of the GE decision process was the fact that the Governor was able to cooperatively work with the city of Boston’s mayor to propose a collaborative economic package that GE found acceptable. This type of collaboration was not found in either of the competing proposals from Chicago or New York. Despite representing different political parties, both Governor Baker and Mayor Walsh found the proper economic solution for GE and have set a standard for similar bipartisan solutions in future economic opportunities within the state.

The recruitment of GE will also have a very positive impact on the state’s overall manufacturing community as GE’s mission to "aspire to be the most competitive company in the world" will impact all who do business with them. In addition to the relocation of the their corporate staff of approximately 200 people, there will be an additional 600 digital industrial product managers, designers, and developers split between GE Digital, Robotics, and Life Sciences. A GE Digital Foundry will be created for co-creation, incubation, and product development with customers, startups, and partners.  All of these interfaces will be subject to GE’s "FASTWORKS" system that ensures quicker product cycles, quicker IT implementation, and faster customer response than industry standards. As the personnel at the GE Innovation center interface with local suppliers and partners they will infuse the requirements of the "FASTWORK "system through the local economy.  This has to be a welcome approach as it has the potential to change the competitiveness of the majority of the state’s manufacturers who are focused on slower moving development processes, related to the Dept. of Defense and medical devices.

GE is a leading example of efforts that are underway throughout the global manufacturing economy to implement next generation manufacturing technologies. These include the Internet of Things (IoT), 3D printing, Big Data, Robotics, etc. that GE is inventing for the next industrial era, to move, power, build, and cure the world. Hopefully they will accomplish much of this development in our state.

As reported in IndustryWeek magazine, "Such changes are not happening overnight, but the Boston Consulting Group forecasts that the combination of these new tools could reduce productions costs by 20% to 40% and radically redefine the dynamics of global competition in many industries."  

GE’s involvement in such new technologies will have an impact on the educational venues throughout the state, especially in the promotion of the Science, Technology, Engineering and Mathematics (STEM) courses, as they will be a very welcome addition to the STEM Council.

The uniqueness of adding of a company who "imagines things others don’t, builds things other can’t, and delivers outcomes that makes the world work better" must be viewed as an asset that can impact our entire state.

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