Growth Through NPS & Lean Six Sigma
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1 GE Healthcare Growth Through NPS & Lean Six Sigma Dee Mellor July 26, 2006 This document contains "forward-looking statements" - that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," or "will." Forwardlooking statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties which could adversely or positively affect our future results include: the behavior of financial markets, including fluctuations in interest rates and commodity prices; strategic actions, including dispositions; future integration of acquired businesses; future financial performance of major industries which we serve, including, without limitation, the air and rail transportation, energy generation, media, real estate and healthcare industries; unanticipated loss development in our insurance businesses; and numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive and regulatory nature. These uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.
2 Healthcare ($ in billions) Revenue Segment profit $15.1 $2.7 ~$17.0 ~$ % 15+% Vision: From Late Disease to Early Health Broad Portfolio Imaging & diagnostics Leading information technologies Innovative life sciences Strong service growth '05 '06E Op Rate 17.9% 18.8% Great position diversified Healthcare business 2
3 NPS + Lean driving growth Net Promoter Score GEHC launched NPS in 04 Customer feedback... ubiquitous Listened to 20,000+ customers Promoters & detractors say #1 Responsiveness & service #2 Quality #3 Communication Lean speed Created Lean showcases Services and MR Customer facing focus Service Product development Selling/relationship Customer sets priorities Targeting NPS 10 pts 3
4 NPS correlations are revealing NPS U.S. segment share CM C-arm CT MR X-Ray 04 NPS baseline prioritizes our efforts 4
5 MR showcase New product introduction base configurations 50% engr change time Selling/relationship Order cycle time 50+ days Customer quote revs 69% Responsiveness & service MR Install: days Service duration 34% Delivering growth 15% 1.5T orders growth 9% price increase 1% CM accretion 5
6 Services showcase Inquiry to order Installation First response Service delivery Performance Days 332 Pre Post Goal Days Pre Post Goal Mins <1 Pre Post Goal Hours Pre Post Goal Lean configs 17 5 PDA forms 47% price points Design 14 4 days Backlog 254 to tracker 26 3 min tech answer min page 58 72% parts ship in 4 hrs Diagnose 14 to <5min Customer Customer Trans 40% 1 Day Install = $10K Cust Revenue Patient Reschedules Reduced 2/Event Patient Throughput +180 CT Exams 6
7 Transform customer experience Customer Triage 18 minutes Restate problem 3X 40,000 cust call/mon 24% misdirected or have to call back Direct to technical soln Unfiltered customer info Visual management <1 Minute Remote technical engineer 21 Min <10 Min Svc Engr Lean 67% process steps Remote fix 25% Customer designed Customer defined specifications Speak in language of customer When you get passionate, dedicated people together, great things can happen. The "patient" was the big winner this week with our new design Cardiology Administrator Heart Hosp 7
8 Service s game plan 06 deliverables $65MM incremental revenue NPS + 10 pts Engaged employees Lean leadership transformation Execution 100+ Kaizens, 1000 FTE s, 400 field problem solvers Future service s drives promoters 1 week from inquiry to order 5 day go live 1 min service response 2X revenue Customer comments When you get it right, you re the best in the industry responsiveness is the key Radiology Administrator Academic Hospital I am a promoter because of your response time and the field engineer that supports Director of Radiology Mid-size Hospital We work with GE because of your reliability, speed of service and your service engineers are knowledgeable Chief Operating Offices Medical Center 8
9 Growth & Margin Expansion Analyst Meeting July 26, 2006
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