GE ColorXpress® Services

Helping Customers Design Differentiated Products

September 21, 2006

By making it easy—and exciting—for customers to become part of the color design team, GE Plastics has created an innovative business that brings customers back time and time again. GE ColorXpress Services offers online self-service color selection and color matching as well as a physical innovation laboratory environment, where customers can work in collaborative teams with GE color experts.

“I’m on a really tight timeline,” the product manager lamented. “We need to start manufacturing these phones in China next week, and my European brand manager just vetoed the color our designer selected. It’s too similar to a competitive model. Can you help? Please!”

That’s the kind of call that’s music to the ears of Dennis Yon, manager of services fulfillment at GE’s ColorXpress Services’ Customer Innovation Center in Selkirk, New York. “The client flew in on Friday with his industrial designer, and we worked with them Friday and Saturday to design new color combinations,” Dennis explained.

Sure enough, by Saturday, working together, the client team and the GE ColorXpress Service specialists had created four completely original colors with different special effects: a translucent blue, a metallic green, a warm mocha with streaks of white, and an iridescent pearl. The client was sure that at least one of these unique colors would pass muster. He jumped on the plane Saturday night clutching his custom-produced plastic chips and samples, secure in the knowledge that the ColorXpress Service technicians had already FedExed batches of the newly formulated resins to his manufacturer in China.

On Monday, the product manager met with his launch team to show them the sample color chips that he and his designer had created over the weekend. No contest: Everyone loved the mocha. But how would it really look on the mobile phone casing? Would the contrast work with the keypad? Would the European brand manager agree with their selection?

A week later, the European brand manager arrived to bless the final designs. Just as the pros and cons of the four color choices were being debated, an express package arrived from China, containing samples of the actual phones in all four color styles. The decision was unanimous: the mocha worked! The delighted product manager called Dennis back and told him that he had just placed the order with his GE rep for $90,000 worth of resin to be delivered direct to his manufacturer by the end of the week.

GE Plastics: Moving from Commodity to Specialty

GE Plastics is a $7 billion global business that employs over 11,000 people and operates some 60 manufacturing and technology facilities in twenty countries worldwide. The company manufactures thousands of different types of plastic resins, sheets, and blends of polymers. These GE engineering thermoplastics are used in aerospace, appliances, automotive, building and construction, data storage and optical media, medical, electrical and electronics devices, telecommunications, computers and peripheral devices, outdoor vehicles and devices, and packaging. Many products use several different types and colors of plastic--perhaps a clear display panel, with colored light housings, along with several complementary colors for casings, buttons, and trim.

GE Plastics has been operating in a tough global competitive environment for the past few years. In 2003, GE Plastics had a particularly bad year, seeing a drop in profits by 50 percent to $422 million on flat sales of $5.2 billion. Since 2000, engineering thermoplastics manufacturers have faced the dual challenges of increases in raw materials costs and manufacturing overcapacity. “There are no easy answers,” GE CEO Jeffrey Immelt pointed out. But he believed that for the future, “the business is focusing on higher margin specialty applications and products. It leads in China, the world’s fastest-growing plastics market. I’m not sure when plastics will get back to 2000 profit levels, but our commitment is to get there ahead of the industry.”[1] Expanding GE Plastic’s position in China was a strong priority for the next few years.

John Krenicki, then head of the advanced materials business unit which included GE Plastics, had a turnaround plan--helping customers design differentiated products. “We cannot count on the economy to turn this business around. We want to make money in any environment. The way to do this is to have unique products. . . .”[2] Focusing on the China market, Krenicki reported in 2004, “Plastics sales in China totaled $640 million in 2003. . . . We are already the largest GE business in China.” But Krenicki acknowledged that in order to grow that market, “Chinese customers also want to be differentiated. That’s what we hear from them: ‘Give me something new. Help me decommoditize my business.’”[3]

And GE Plastics is continuing with its efforts to meet customer needs in China and elsewhere in what remains a very tough competitive environment. One solution to the profitability puzzle is convincing customers to pay for precolored resins and for resins that are premixed to produce special effects. When manufacturers add colorants to the resin during the production process, it may be harder to insure color consistency, especially when the same parts are being manufactured in different facilities around the world. Special effects--such as sparkle, marbling, streaking, and luminescence--are very difficult to add during the molding process. The solution is to custom-manufacture the plastic resin with the right color and special effects from the outset. Of course, a custom colored plastic is slightly more expensive than natural resin. But if the finish of a product successfully differentiates that product in the marketplace, it can make the difference between a flop and a blockbuster success.

Sure enough, differentiation is working. Per the annual report, GE Plastics revenue in 2005 was $6.606 billion and profit was $867 million.

Key Customer Scenarios® Surrounding Color and Finish for Product Design/Manufacturing

We recently interviewed a number of ColorXpress Services customers to better understand their context and needs. Whether GE’s customers are designing and producing a car, a computer, a cellphone, or a shower stall, the concerns surrounding choosing the color for the manufacturing of the product are the same. The top issues include...


Sign in to download the full article


Be the first one to comment.

You must be a member to comment. Sign in or create a free account.