GE Aircraft Engines isn't the only General Electric business calling Greater Cincinnati home.

        The North American headquarters for GE Capital's IT Solutions unit, which markets computers and systems to larger companies, has been based at Newport's Riverfront Place since 1999.

        One of 26 businesses within GE Capital, the largest non-bank finance company, the information technology equipment unit moved its North American headquarters to Newport from offices in Minneapolis and Stamford, Conn., to be closer to its distribution and telephone call center in Erlanger.

        IT Solutions, part of GE Capital's equipment management group which also includes GE's aircraft leasing unit, employs about 325 in Newport and Erlanger and 2,200 across North America.

        In the last year in the face of the dot-com meltdown and economic recession, GE's information technology business has gotten smaller in order to get bigger, Ken Luke, president of product solutions, said.

        The business has de-emphasized selling low-margin computer hardware and is concentrating on selling more profitable computer services, he said.

        “We faced the reality of a tough marketplace and the fact we couldn't keep doing what we used to do,” he said. “It's no longer acceptable to be just a hardware reseller and live on thinner (profit) margins.”

        The shift was reflected in global revenues for the business which dropped from $7.1 billion in 2000 to $4.2 billion last year. GE Capital businesses are disclosing more detail about their financial performance for the first time as a result of a dictate by GE chairman Jeff Immelt.

        The good news is that after reporting operating losses of $197 million in the prior year, GE Capital IT Solutions, including the separately managed European operation based in Munich, Germany, generated a $11 million profit last year.

        Despite what GE calls a “structured decline” in revenues, the performance was still good enough to rank GE Capital IT Solutions 17th on list of largest information technology providers compiled annually by VAR Business, a trade publication.

        The business has also adopted a more focused approach to its market, instead of trying to be all things to all types of businesses.

        IT Solutions has targeted businesses of $100 million to $1 billion in revenues in eight major U.S. cities including Cincinnati and four Canadian markets.

        In each market, IT Solutions is concentrating on key industry segments.

        For example, in Greater Cincinnati, it is focusing on health care and manufacturing, while its Houston office is focused more on oil and petroleum industries, Mr. Luke said.

        “We're a national provider with a regional presence,” he said.

        The business is also able to leverage the resources of its parent company.

        In marketing to health-care providers, for example, the company can tap the financing capabilities of GE Capital and marry that with the medical imaging expertise of GE Medical Systems to offer the latest in high technology, he said.

        “We think we're positioned well to become a growth player. We've taken the tough actions. (to grow) when the market comes back,” Mr. Luke said.

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