 On Sand Hill Road in the heart of Silicon Valley, it's theCUBE, presenting the People First Network, insights from entrepreneurs and tech leaders. Well, I'm John Furrier with theCUBE. I'm the co-host, also the founder of SiliconANGLE Media. We are here on Sand Hill Road at Mayfield for the People First Conversations. I'm John Furrier with theCUBE. We're here at Allen Bay and Global CTO and IT of Innovation at Procter & Gamble, formerly the same position at Coca-Cola, has done a lot of innovations over the years. Oh, it's also a reference account back in the day for web methods when they called on the financing of that one of the most famous IPOs which set the groundwork for web services and has a lot of history. Going back to the 80s, we were just talking about it. Welcome, this conversation on People First Network. Well, thank you for inviting me. So the People First Network is all about people and it's great to have these conversations. You're old school, you were doing some stuff back in the 80s, talking about doing RPA, 3270, you've been old school here. And I go back to APL as my first programming language, went through the third generation languages and of course the old 3270 emulation which is what we know today as RPA. One of the cool things that I was excited to hear some of your background around your history, web methods, you were a reference call for venture financing of web methods which was financed on the credit card for the two founders, husband and wife. Probably one of the most successful IPOs but more importantly, at the beginning of the massive wave that we now see with web services. This is early days. This was very early days. When I was at DHL, we were looking at what we're going to do for the future and in fact we built one of the first object oriented frameworks in C++ at the time because that was all that was available to us or the best was available. We rejected Corbis and we said, look, we're going to go this direction. And one of my developers found web methods, found Phillip Merrick, who was literally at the time working out of his garage and had this technology that was going to allow us to start moving into this object oriented approach. And I remember the day Robyn Vassen from Mayfield called and said, hey, I'm thinking about investing in web methods, what do you think about it? And not only was it one of the first startups that I ever worked with, but it's actually the first time I met anybody in the venture community. Way back in 19, I think it was 1997 is when it happened. And that was a exciting time in computer science and then the rest is history and then XML became what it became, Lingua Franklin for the web, web services, now Amazon web services. You're seeing cloud computing, microservices, Kubernetes, service measures. This is a new stack that's being developed in the cloud. And this is the new generation, you've seen many waves. And at Procter & Gamble, formerly Coca-Cola, you're the same role. You have to navigate this. So what's different now? What's different from say 15, 20 years ago? How are you looking at this market? How are you implementing some of the IT and infrastructure and software development environments? I think what's changed is when we got into the early 2000s, Nicholas Carr came out and said IT doesn't matter. And I think anybody that was in IT had this very objectionable response initially. But when you step back and you looked at it, what you realized was in many cases, IT didn't matter and those were those areas that were non-competitive, those things that could be commoditized and it was completely right. The reality is IT has always mattered. The technology does give you a competitive advantage in certain markets and certain capabilities for a company. But back then we had to go out and we had to purchase equipment. We had to configure the equipment. There was a lot of heavy lifting and corporations just did not want to invest the capital so they outsourced the stuff wholesale. I think General Motors was the first one that just outsourced everything and was followed by other companies including Procter and Gamble. The decision at that time was probably right. But as you go forward and we see what's happened with corporations, we see the valuations of corporations, the amount of return on equity based on the capital that's being invested, we can see that data is important. We can see that agility, flexibility is key to competing in the future. And therefore what's changing is we are now moving into an age of away from ERPs. We're moving into an age away from these outsourced providers on a wholesale basis and using it selectively to drive down costs and allowing us to free up money in order to invest in those things that are most important to the company. So you're saying is that the folks, I mean naturally the server consolidation bought all this gear, all this software over 18 month roll-outs before they even see the first implementation. Those were the glory days, the gravy trains for the vendors. Not good for the practitioners. But you're saying that the folks who reinvested or are investing in IT as a core competency are seeing a competitive advantage. They certainly are. I think I made the statement in front of a number of the vendors a few years ago and people were not comfortable with it. But what I said was like, gone are the ears of these 10, 20 million dollar deals. Gone are the ears of the million, two million dollar deals. We're in the era of throw away technology. I need to be able to use and invest in technology for a specific purpose, for a specific period of time and be able to move on to the next one. It's the perfect time for startups. But startups shouldn't be looking at the big picture. They should be looking at the tail on these investments. Let me try things. Let me get out in the market. Let me have a competitive advantage in marketing which is most important to me, or in supply chain. Those are the areas that I can make a difference with my consumers and my customers and that's where the investments have to go. This is just a concept of throw away technology and you know, you could also be set of being more agile, but interesting. If you look at the cloud SaaS business model, if Amazon for instance, I think that's gold standard where they actually lower prices on a per unit basis and increase more services and value. But in the aggregate, you're still paying more but you have more flexibility. And that's kind of a good tell side so that you're seeing that ability to reuse either the infrastructure that's commoditized to shift the value. This is, are people having a hard time understanding this? So I want to get your reaction to how should IT leaders understand the wave of cloud, the wave of machine learning, what AI can bring to the table, these new trends? How should leaders figure this out? Is there a playbook? Is there things that you've learned that you could share? I don't know that there's really a playbook. It's still early on. Everyone's looking for one cloud fits all. The reality is, whether it's Google, whether it's Amazon, whether it's Microsoft, whether it's IBM, all clouds are different. All clouds have a purpose built for different solutions. And I think as an IT leader, you have to understand you're not going to just take everything and lift and shift. That's what we used to do. We're now in a position where we have to deconstruct our business. We have to understand the services, the capabilities that we want to bring to the market and not lock ourselves in. It's building blocks. It's Legos. We're in the period of Legos putting these things together in different manners in order to create new solutions. If we try to lock ourselves in the past of how we've always financed things, how we've always built things, then we're not going to be any better off in the new world than we were in the old. Alan, I want to get your reaction to two words. RPA and containers. Well, as I said earlier, RPA is 3270 emulation from the 1980s. And for those of us that are old enough to remember that, I still remember scraping the old green screens and putting a little process around it. What's nice though is that we have moved forward machine learning and AI and other capabilities are now present so that we can do this. I actually played around with neural nets, probably back in 1985 with an Apollo computer. So that tells you how far back I go. But technologies change, processing speeds change, everything the technology trends are allowing us to now to do these things. The question that we have is also a moral dilemma is, are we trying to replace people or are we trying to make improvements? And I think that you don't look at RPA as a way simply to replace work. It's a way to enhance what we're doing in order to create new value for the customer or for the consumer in our case. I think in the area of containers, again, it's been around for a while. It's just another approach that we don't want lock-in, we don't want to be dependent on specific vendors, we want the portability, we want the flexibility. And I think as we start moving containers out to the edge, that's where we're going to start seeing more value as the business processes and the capabilities are spread out again. The idea of centralized cloud computing is very good. However, it does need to be distributed. What's interesting I find about the conversation here is that you mentioned a couple of things earlier. You mentioned the vendors locking you in and saying, here's the ERP buy this and with this you have to have a certain process because this is our technology. You got to use it this way and you were a slave to their tech and your process served their tech. With containers and say orchestration, you now have the ability to manage workloads differently. And so an interesting time, does that change the notion of rip and replace, lift and shift? Because if I have a container, I can just put a container around it and I don't have to worry about killing the old to bring in the new. This is some of the fundamental kind of debate going on. Do you have to kill the old to bring in the new? Well, you need to kill the old sometimes just because it's old and it's time to go. Other times you do need to repackage it. And other times I hate to say it, you do need to lift and shift. If you're a legacy organization, you have a long history, such as most of the manufacturing companies in the world today, we can't get rid of old things that quickly. We can't afford to. A lot of the processes are still valid. As we're looking to the future, we certainly are breaking these things down into services. We're looking to containerize these things. We're looking to move them into areas where we can compute where we want to, when we want to at the right price. We're just at the beginning of that journey in the industry. I still think there's about five to seven years to go to get there. Now, I'll talk about the role of the edge, the role of cloud computing as it increases the surface area of IT potentially, combined with the fact that IT is a competitive advantage, bring those two notions together. What's the role of the people? Because you used to have people that would just manage to rack and stack. I'm provisioning some storage. I'm doing this as those stove pipes start to be broken down. The surface area of IT is bigger. How does that change the relationship of the people involved? You win with people at the end of the day. You don't win with technology in a company such as Procter & Gamble. And I think what's happened, if you look at historically, the ERP vendors came out probably 99, 2000. And it used to be, I remember these, I'm old, to be honest with you, but I remember that we used to have to worry about the amount of memory we were managing. We had to be able to tune databases and all of this. And the vendors went ahead and they started automating all those processes with the idea that we can do it better than a human. And a lot of people, a lot of the technology talent, then started leaving the organizations. And organizations were left with people that were focusing on process and people, process, excuse me, process, and the business, which is very good because you need the subject matter experts. Going forward, we have to reinvest in people. Our people have the subject matter expertise. They have some technology skills that they've developed over the years and have enhanced on their own. But we're in this huge change right now where we have to think different, we have to act different, and we have to behave differently. So doubling down on people is the best thing that you can do. And the old outsourced model of outsourcing everything kind of reduces the core competency of the people. And now you got to build it back up again. Exactly, when we left at P&G 15 years ago, about 5,000 people left the organization when we outsourced the technology to our partner at that time. Now it's time we're starting to bring it back in. We've brought the network team back in and stood up our own sock and our own knock for the first time in years, just this past year. We're doing the same thing by moving things out to the cloud. More and more is moving to the cloud. We're setting up our own cloud operations and DevOps capabilities. I can tell you, having been on both sides of it, it's a lot harder to be able to bring it back in than it is to take it out. And you know, interesting proctoring game is well known as being very intimate with the data, very data-driven company. The data is valuable. And having that infrastructure and IT to support the data, that's important. What's your vision on the data, future of the data in the world? Well, I think data has a value to itself, but when you tie it to products, you tie it to your customers and consumers, it's even more valuable. And we're in the process now of things that we used to do completely internally with our own technology or technology partners. We're now moving all of that out into the cloud. Now, I'm going to say cloud, it's cloud's plural. Again, going back to certain clouds are better for certain things. So you're seeing a dramatic shift. We have a number of projects underway that are in the cloud space, both for customers and consumers, number of cloud projects in the way for our own internal employees. It's all about collecting the data, processing the data, protecting that data, because we take that very seriously and being able to use it to make better decisions. I want to get your reaction on two points and two lines of questioning here, because I think it's very relevant. On the enterprise side, you're a big account for the big whales, the old ERPs, so the big cloud providers. So people want to sell you stuff. At the same time, you're also running IT innovation, so you want to play with the new shiny new toys and experiment with startups. So if startups want to get your attention and big vendors want to sell to you, the tables have kind of turned. It's been good. It's a good buyer's market right now in my opinion. So what's your thoughts on that? So start with the big companies. What do they got to do to win you over? What do they got to look like? How do they got to engage? And for startups, how do they get your attention? I think the biggest thing for either startup or large companies, understanding the company you're dealing with, whether it's Procter & Gamble, whether it's Coca-Cola, whether it was DHL, if you understand how I operate, if you understand how decisions are made, if you understand how I'm organized, that's going to give you a competitive advantage. Now, the large corporations understand this because they've been around through the entire journey of computing with these large corporations. The startups need to step back and take a look and see where do I add that competitive advantage. Many times when you're selling to a large corporate, you're not selling to a large corporate, you're selling to divisions, you're selling to functions, and that's how you get in. I've been working with startups, as I said, back since web methods, and it was just a two-person company, but we brought them in for a very specific capability. I then took web methods with me. When I left DHL, I took them to GE. When I left GE, I took them to ING because I trusted them and they matured along the way. I think finding that right individual that has the right need is the key, and working it slowly. Don't think you're going to close the deal fast if you're a startup. Know it's going to take some time and decide if that's in your best interest or not. Slow things down, focus, don't try to boil the ocean over. Too many of them try to boil, you're right. Too many people try to boil the ocean. Get that win, one win will get you another win, which will get you another win, and that's the best way to succeed. Get that beach head. Alan, so if you could go back and knowing what you know now, and you're breaking into the IT leadership's position, looking forward, what would you do differently? You can do a Mulligan. Hey, what would you do differently? Well, you know, I think one of the dangers of being an innovator in IT is that you really are a risk taker, and taking risks is counterculture to corporations. So I think I would probably try to get buy-in a little bit more. I mean, someone once told me that, you know, you see the forest through the trees before anybody else does. Your problem is you don't bring people along with you. So I think I would probably slow down a little bit, not in the adoption of technology, but I'd probably take more time to build the case, to bring people along a lot faster, so that they can see it and they can take credit for it, and they can move the needle as well. Yeah, and you know, we sometimes early adopters and pioneers had the arrows in the back, as they say. I've had my share. Alan, thanks for sharing your experience. What's next for you? What's the next mountain you're going to climb? Well, I think that as we're looking forward, latency is still an issue. You know, we have to find a way to defeat latency, and we're not going to do it through basic physics. So we're going to have to change our business models, change our technology distribution, change everything that we're doing. Consumers and customers are demanding instant access to enhanced information through AI and ML right at the point where they want it. And that means we're now dealing with milliseconds and nanoseconds of having to make decisions. So I'm very interested in looking at how are we going to change consumer behavior and customer behavior by combining a lot of the new technology trends that are underway. And we have to do it also with security in mind now. Before we used security with secondary. Now as we're seeing with all of the hacks and the malware and everything that's going on in the world, we have to go in and think a little bit different about how we're going to do that. So I'm very much engaged in working with a lot of startups. I live here in the Silicon Valley. I commute to Cincinnati for Procter and Gamble. I'm spending time and just flew in from Tel Aviv literally an hour ago. I'm in the middle of all the technology hotspots trying to find that next big thing. And that's a global, it's global. Innovation happens everywhere and anywhere. The venture community, if you look at the amount of funds that used to be invested out of the Silicon Valley versus the rest of the world, it continues to be on a downward trend. Not because the funding isn't here in the Silicon Valley but because everyone is recognizing that innovation and technology is developed everywhere in the world. Alan Behm is the CTO, global CTO and IT innovator here at the CUBE Conversation here in San Hill Road. I'm John Furrier. Thanks for watching.