GE: Pioneering a new era — creating three independent industry leaders

SOLUTION

Solving a complex puzzle

PwC supported GE with a transact-to-transform strategy — an approach rooted in a combination of rigor, continuity and governance. The project included setting up new public companies, restructuring legal entities and separating historically shared services like research and development, human resources, cloud and digital infrastructure and finance. GE's commitment to lean practices and continuous improvement was instrumental in consistently elevating project standards.

PwC helped manage expenses by addressing stranded costs, conducting cost assessments and executing allocations through more than 700 transitional service agreements (TSAs) — contracts that outline temporary support services. What’s more, the team helped set up financial systems for the three new companies, enabling a strong, independent financial infrastructure for each. The team also evaluated accounting decisions, performed 2,000 legal entity separations and allocated more than $4 billion in shared assets and liabilities across all three organizations. 

Building integrity into regulatory and tax strategy

The GE and PwC teams addressed tax strategy first because it impacts nearly every part of the business and shapes project deadlines. They then carefully managed the transfer of assets and liabilities, confirming that they were properly allocated to the business — while prioritizing governance around IP, trademarks and patents as a key step in the process. Compliance and operational integrity were considered at every turn. 

Throughout the process, the PwC team automated contract review and metadata extraction, saving countless hours across thousands of legal documents. Real-time visual data flows now provided accessible and flexible data for both teams. PwC's global network in 149 countries helped with advice on legal, tax and other issues to enable decision-making and prevent delays.

Focused financials for a seamless transition

Together, the two teams leveraged their historical knowledge of the business — along with PwC’s proprietary algorithms — to automate production of the carve-out financial statements and Form 10 filings with the SEC. They developed SEC-compliant non-GAAP metrics and key performance indicators to help tell each industry-specific equity story, meeting peer and analyst expectations with a successful SEC registration. 

The teams developed dynamic carve-out data models that were key to providing a single source of truth for financial information in real time. This data fueled financial reporting and empowered global stakeholders to drive scenario planning and strategic decisions — a real differentiator in the financial statement process.

Human capital: From new roles to new beginnings

PwC helped GE fill new roles and transfer about 12,000 employees across the three new entities within 90+ countries. This meant carefully planning transition timing, addressing benefit plan location complexities and making sure that PwC supported GE’s teams across international markets during the transition.

The spin-offs required dismantling a centralized shared services group and recreating the fit-for-purpose processes, systems and teams within each new organization while keeping everything aligned and efficient. Together, the two teams set up 75 benefits and 95 payroll systems across the global footprint of the new companies. With PwC’s help, GE rolled out upskilling efforts that allowed existing employees to address new challenges. The team implemented new HR systems to handle payroll and benefits separation. Throughout these processes, the teams focused on preserving GE's company culture and workforce stability.

Marketing and internal communications: Maintaining trust and leaning on tech

Marketing and internal communications efforts were vital in providing clear, consistent messaging, maintaining stakeholder trust and supporting a seamless transition. PwC worked hand-in-hand with GE to coordinate and review new employee handbooks, helping GE focus on maintaining a positive employee experience, mapping out current-state processes and drafting Day One manuals with information on everything from separation strategy to guidance on new email addresses and cloud collaboration tools.

Digital technology: Unknotting IT

Within digital technology — which GE calls its IT vertical — PwC helped evaluate, separate and then re-implement the systems, platforms, applications, network and cloud infrastructure that kept the business moving. Simply untangling a standalone piece of digital technology wasn’t an option given the thousands of software systems running congruently. GE and PwC worked together to develop a cloud infrastructure strategy that leveraged modern workplace solutions to drive compliance and future readiness.

The team simplified IT infrastructure and distributed the separation process across 48 ERPs and eight data centers. This also involved contract separation, including collecting and reviewing more than 200,000 supplier documents and using AI and analytics tools to review more than 7,000 contracts, identifying clauses for easy transitions, preparing for negotiations and, when necessary, determining alternative actions.

Junction: The digital nerve center formed a foundation for success

At the core of everything was Junction, a PwC-developed tool and digital “nerve center” leveraged by both teams for decision making and insights. Junction served as a central hub — and single source of truth — for global separation information across the GE portfolio. To maintain focus on project goals, PwC tailored the platform to align with GE's operational workflows and strategy.

Junction tracked new data in real time by combing disparate information streams — including finance and HR — enabling stakeholders to access accurate information and reporting with just a few taps. Junction also showed GE decision makers a view of dependencies, meaning what one function needed from another to complete their separation activities. 

Custom decision-making dashboards saved GE thousands of hours in meticulous project tracking. As an added benefit, Junction was easy to use because it was built with Microsoft Cloud technology and incorporates tools that employees were already familiar with. The cloud-based tool helped GE and PwC team members at every level achieve global collaboration across more than 40 global workstreams in over 90 countries. With Junction, the two teams could identify high-risk operations and quickly remedy them.

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