“Hewlett Packard was a company with 328,000 people and a diverse portfolio from Big Data analytics to consumer printers that served the market well for a number of years, but when we looked to the future, we needed to make sure it had the ability to change at a pace that was ideally faster than the market. We wanted to be able to position the organisation to deal with an era of unprecedented change.”
So says Ciaran Hynes, country channel sales director at Hewlett Packard Enterprise (HPE) outlining the reasons for the technology giant’s split into two separate companies at the start of this month: HPE and HP Inc. He describes the division as a “very neat 50:50 split of the company. The logic is extremely sound”. The two organisations have a turnover of $57 billion each, an operating margin of around 10% and each business is a Fortune 50 company in its own right. While HP Inc has taken over the personal systems and printing operations, HPE owns the enterprise hardware, services, software and leasing arms.
An estimated 100 billion connected devices and 1trillion apps by 2020 will create new demands and opportunities for the IT industry “in terms of how we build, operate and consume systems to address the apps, data and risks associated with mobility and connectivity”. He argues it is incumbent on HPE and its partners “to adapt to be able to meet demand for customers with new business model solutions. The drive must be away from IT being a cost centre with a focus on containing costs, to being a function which delivers value to the business in terms of enablement of new markets, analytics of existing markets and intelligence to every function within the business, marketing, operations, sales etc”.
Transformation
HPE has outlined four ‘transformation areas’ for its ‘new style of business’ with a total addressable market worth an estimated $1.1trillion in 2018. This includes $565 billion to cover the transformation to hybrid infrastructure, $114 billion to protect the digital enterprise, $161 billion to empower the data driven organisation and $271 billion to enable workplace productivity.
Breaking down the hybrid infrastructure spend further, Hynes reveals that 75% of EMEA-based enterprises will be using IaaS in some form or other by 2016 and 40% of midsize enterprises are predicted to replace all their data centre servers and storage with integrated systems by 2018. As much as 38% of total IT spend is already outside the IT department today and that figure will increase to more than 50% by 2017. The shift to hybrid technology will enable customers to “build an agile environment at minimal cost to be able to react to market opportunities as business encounters them”.
But what will that mean for the role of partners? “The model we’re building is dependent on a joint delivery model between us and our channel partner community,” Hynes states. “We’re training, enabling and supporting our partners to be services-led, knowledgeable on software and to take an innovative approach to what the customer requires rather than to be insistent on selling a particular flavour of solution that a vendor may impose upon them. We’re encouraging partners and supporting them with solutions to build hybrid consumption models for their customers.”
He accepts that this approach “may appear counter-intuitive for a hardware vendor, but the reality is that if the market is changing, we want to be leading the charge”. As for the HP software business, he says it’s worth noting it is the sixth largest software business in the world. In an era of software defined everything, Hynes believes HPE can “continue to set the standards in this space”, remarking that the vendor has been in the software defined storage space for more than 10 years since its acquisition of Lefthand while, in the networking market, it “has the most comprehensive portfolio of SDN solutions of any vendor”.
Hynes believes HPE’s portfolio “is unparalleled by any vendor in the market. We’re the number one globally for x86 servers, we have market leading storage solutions, coupled with networking and software solutions that support the hybrid infrastructure strategy. Similarly, those solutions, coupled with our wide variety of software solutions (including HP Autonomy), offer Big Data analytics for a wide variety of organisations”.
Connectivity
One area that Hynes is keen to address is the opportunity presented by the vendor’s acquisition of Aruba last year which he says “enables excellent 802.11ac connectivity with security applications designed for enterprise organisations”. Reaction since the acquisition “has been really positive across the board”, he claims, adding that the “marriage of fantastic technology with the best partner community in the industry means we have the best go to market to get the Aruba message out to our customer base”. While it is still in the early stages of capitalising on the opportunity, HPE has “already seen enormous opportunity, with two deals in excess of €1 million closed in Ireland in the last two months alone”.
The beauty of Aruba’s portfolio “is that the opportunity is equally applicable to the SME market. Wireless gives channel partners the opportunity to speak to customers about a topic that is generic to everybody. It also enables the channel sales team to understand the technology and articulate it to customers without a huge amount of training”.
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