 Live from Las Vegas, Nevada, it's The Cube at IBM Edge 2014. Brought to you by IBM. Now here are your hosts, Dave Vellante and Stu Miniman. Welcome back to Las Vegas, everybody. This is The Cube. The Cube is covering IBM Edge. This is our third year doing IBM Edge. We have been doing a lot of the events this year. We were just at OpenStack last week. We're at EMC World the week before. We've got all kinds of events coming up. This is day one of IBM Edge. Edge is a conference really focused on storage and other adjacencies. Kind of systems and technology group. Little bit of big data worked in. We're hearing some Watson drafting going on, but really is a storage show. A lot of IT practitioners, partners, consultants, analysts, vloggers and the like. Robert Moniz is here as the Vice President General Manager of Glasshouse Systems. The winner of the Winning Edge Award for the second year in a row, Robert. Welcome to The Cube and congratulations. Thanks, Dave. So Winning Edge, the award goes to the best partner. Right? Is that the deal? Yes, I'd like to believe that. I think that it's recognition for continued performance in the marketplace for selling storage, helping customers in that area. If we listen to Paulo announce the preamble prior to the award. It was really around coupling that around technical competency. That's an area of our business that we take very seriously and one that has helped our customers tremendously. Glasshouse employs a very unique methodology in terms of having a lot of technical skill, a really deep technical bench. And it's nice to be recognized for those investments. Not only in helping our customers, but seeing how IBM appreciates that as well. So you were saying off camera, you guys are largely a group of ex-SEs. Correct. So SEs, you know, rock star system engineers, right? That actually are heavily involved in the defining customer requirements and fulfilling customer requirements. I mean, not a lot of things are sold without the SEs involvement, right? Absolutely. Our SEs are former IBM Redbook contributors. A lot of our sales staff are former SEs or systems engineers. Our entire management team is made up of former systems engineers. So customers can expect a very consultative, methodical, patient approach to understanding the requirements, you know, building architectures and solutions around what their lines of businesses are trying to achieve. And also in the design process, employing a design that is not that disruptive to what they've previously invested in. So we try to do the soft change, maximize the client's return on investment and try to do more with less. Really try to preserve what they have, integrate what they need to do into what they have and then add on any ancillary equipment or solutions that they need to acquire. So, you know, when you look at storage requirements and you talk to customers, we talk to a lot of customers and you know, sometimes the requirements are kind of boring. When you go to conferences like this, it's exciting. You've got software defined, you've got flash, you've got disruption, big data cloud, mobile, social. When you talk to customers, they're like, my budget's getting cut or it's flat. I got to do more with less. I'm trying to figure out in how to meet the SLA requirements of the business. You know, I got all these old applications that I'm supporting. Help me. So you got the sort of vendor buzz at this end of the spectrum. You got the customer pain in this end of the spectrum. Is the truth somewhere in the middle or is it more sort of where the customers are? It absolutely is. The trick to storage is really, there's usually more than one approach that could solve the problem. What we pride ourselves on is taking a step back and looking through the customer lens. Really, you know, it gets back to, what is it that they're really trying to achieve? Starting with line of business, right? Because that data, or the data that they're trying to leverage is the most critical piece of their business. So it's not about, and it shouldn't be about the lowest cost per terabyte. It's really access, it's really value. Is it good data? Is it tainted data? And then protecting that data. So back to our technical competence in terms of working with clients, it's really around, and I tend to disagree, it's not really boring. It's sifting through everything that's available there to understand, because it's actually really exciting. I would say it was boring 10 years ago when it was just discontainment. Today, with software-defined storage infrastructures and cloud and off-prem and on-prem, it's really sitting down and working with clients to understand not only what they're trying to satisfy today, but will that investment last through the life of the lease or the life of the application so that they can leverage that for the next go-around? So how do you guys get paid? Obviously, a reselling product, that's fine, but you're also doing a lot of consulting. Is that upfront loss leader? Are you getting paid for those types of services? Are you doing design, implementation? It's a bit of both. We do provide, storage requires a lot of pre-sales technical support. We do have clients that will pay for those services because they're a non-IBM infrastructure shop today, but they understand that we get that type of architecture and that we can help them minimize cost and increase performance or optimize, and reduce square footage, cooling, all of that. And then we have other engagements where that's just part of the sale cycle. It's part of the value that we bring as part of doing business with Glasshouse. So my last question, I'll turn it over to Stu, is how much are you getting pulled into specific application and workload areas of expertise, whether it's SAP, Microsoft, maybe VMware, Oracle, is that something that's tugging at you? Yeah, it is. We support some of the largest SAP clients in North America, and SAP itself is changing in what they're requiring their customers to do. So we work with our clients through some of those changes, in Oracle as well, on the server side and the application side. So we will work with those customers to optimize how those other vendors' products will sit on storage. So, Robert, let me dig in on that Hanna piece a little bit. SAP finally supporting virtualized Hanna. Is that a conversation you're having with your customers? How big of a deal is that? It is, because we also resell Hanna as part of being an IBM reseller. So it's clear that SAP want all their customers to run on Hanna, but Hanna's not the only technology out there for inline memory analytics. So if a customer's heavily invested in Hanna, we'll continue to work with them to protect those investments. If a customer has not yet embraced Hanna, but want to perform due diligence on how do I run analytics against my SAP databases, we'll sit down and we'll take them through it. All right, so when we were talking about software defined storage, I think last year it felt like there were a lot of buzzwords and it sounds like you're saying that it's becoming a real dialogue today. Obviously IBM had a lot of announcements over the last month or so. Walk us through, what's the conversation you're having? What's the pain point that this is filling for customers? Where are we? I think the pain point around software defined storage infrastructures will be working with clients to set up the processes for defining that automation. Do they really need to understand today how they want to automate those tasks so that they can free up those resources to do other things that can actually bring value as opposed to time spent keywacking redundant tasks? Yeah, so in that transformation from just kind of keeping the lights on, doing all that manual work, are you working with your clients as to how they create more business value, shift some of their workforce, create more innovation? And as a managed service provider, we're actually helping some of our clients in that regard by taking some of those mundane tasks away so that they can take those higher value resources and redeploy them back to line of business. Okay, great, so I didn't realize you're an MSP too. What are some of the key applications? What are the early wins that you're getting that a lot of customers are using? Today it's really on-prem for the customer. We will manage a lot of back office stuff for the client. Typically clients will still hold title to those assets and we just provide a lot of the care and feeding over a wire so that they can, as I said, redeploy those resources for more meaningful tasks. So, I'm a customer, maybe I'm an IBM shop, maybe I'm not, let's say I'm not. Come in and say, all right, everybody's coming in every week, I got a new vendor coming in, each piece coming in, EMC's coming in, everybody's talking about software to find. What differentiates IBM's software to find strategy and consequently your services as a partner? Because I'm going to work with you, I'm not going to work directly with IBM and buy from you. What differentiates what you guys are doing from everybody else in the crowd? Well, I like to think that we're working within your timelines with what the client's willing to spend and really being your advocate, being your trusted advisor. We're not product pushers, we're not pushing or selling the flavor of the day. If it comes back to the consultancy, coming back to working backwards from a customer's requirements and understanding what you're trying to achieve and understanding if that product's the right fit and if it's not, we'll tell you. So, will you utilize other products, not IBM products or not necessarily? No, we're an IBM only reseller today. Okay, so you'll just say, hey, it's not a right fit. Maybe you should talk to another reseller. Correct. So, talk about an example of a typical consultant, analyst, give me a typical. But give us a typical situation with the customer. In terms of, you mentioned some parameters, right? They're trying to cut costs, they're trying to do more with less. They're looking at new ways of doing things, but they don't want massive disruption. You're starting with their business. I wonder if you could, name names are not, it doesn't matter, but maybe even generically, talk about a particular industry where you're helped a customer solve a particular problem and talk about what the outcome was. Well, it's interesting. We actually, we cover a lot of industries, from retail to small, medium, large government, federal governments. We have a lot of insurance, both general and life. And the interesting thing at Glasshouse is because we participate in all those industries, some are leaders and others are laggers in terms of adopting some of the optimization around storage. So, I would say that retail is out front in terms of really trying to differentiate themselves with technology and the value of their data. And some of the other industries are more wait and see, let somebody else build something first. So a typical engagement would vary by industry. I would say that the Type B personality insurance company is going to be very nervous about change. So in that type of customer situation, we're going to be very sensitive to disruption. We will be very cognizant of what they've previously spent, whether there's still book value on those systems, how we can leverage frames and existing processors to maybe just introduce virtualization and optimization. Maybe it's just services that they require because they've got more than they can chew. For a retail customer, it's really going to be about acquiring something they don't currently have today to give them that edge. And that one is a bit more challenging because there's so much out there to choose from. So it's sitting down, working backwards from what they're trying to achieve and understanding how quickly do they need to get that on the ground. Yeah, it's interesting, right? Virtually every retail company has Amazon breathing down their neck in some way, shape, or form. Folks, should I go do public cloud too? Should I try to replicate that in-house? Am I going to get this intermediate? And in government, I don't know what Ottawa is like, but there was certainly a craze in the United States and it's probably continuing on cloud first, right? Meaning public cloud first. So insurance companies, as you say, they got very complex application portfolios. Their average applications are probably more than 20 years old, right? So they can't afford a lot of disruption and they've got the annuity anyway, so don't, it's not broken, so don't try to fix it. So what about the public cloud? How does that fit in to your portfolio? Is it a software play? It is, we are a software reseller today. We see a fit for it in our customer base. I think long-term, we'll see what IBM has predicted and what we kind of anticipated, which is not everything's in go off-prem public cloud. There are workloads that make sense for that, email, some file data that you don't need access to, that only a few people really need for a very fixed period of time. We see the trend towards hybrid, some off-prem public cloud, some on-prem private clouds, and then your discrete systems that run high-value workloads. So for an insurance company, as an example, they have a lot of legacy data that's not federated. You as a client call in, you may have your home policy on one system and your auto policy on another system. How do you, as a customer, get treated by that insurance company when you're dealing with them? So Robert, when you talk about the hybrid cloud, one of the things that IBM positions is that you can get a single vendor with a very similar environment between your on-prem and your off-prem. How important do you see that for your insurance? Oh, I think that's very important, and that's why we've decided to focus strictly on IBM. We wanted to partner with the best in the industry, and I think IBM's figured that out. IBM does a very good job of thinking customer first and thinking customer first long-term. So with IBM's acquisition of Soft Flare and the suite of products that they've put around that, I think IBM's well positioned to lead moving forward. Yeah, it's interesting, we did a survey a year ago and we asked users if that was important to them, and the majority of them said yes, but of course they've asked them what they had. They tended to have usually a VMware environment in-house and they had AWS in the public cloud. So when you go to the IT shop and say, would you like that at GS, but we get down to the details, it's sometimes difficult to get that down to a single environment. Access in any industry comes down to simplicity and packaging. So IBM will be very good at packaging this thing and making it very easy to access and deploy. What are you seeing with so-called shadow IT? Pardon? So-called shadow IT. So you've got a line of businesses, hey, I want a CMO, so let's get the IT guys, let's just end around them, I'll pay for it, get a little Rockstar development team going, we'll swipe a credit card, spin up some EC2 instances, whatever. What are you seeing there? How do you participate or co-locate with that type of activity? Do you sort of embrace it? Do you sort of watch it? Do you advise against it? Do you hybridize it? How do you approach it? We actually embrace it. For a long time we've been helping customers with Linux on the mainframe and that typically gets started as a Skunkworks project. But we embrace it with a caveat, which is are you introducing risks to your company? So we try to make customers aware that there is that capability to do, well, case in point, we have an innovation center, so we have a data center within our headquarters where we take part in a lot of IBM's leading demo programs. So Flash, the new Wave products, often before they're even generally available. So we'll work with clients to build those Skunkworks projects, but not on their prem, on our prem. And we'll demo it for them. And we're excited by their energy in terms of going off and doing that stuff. And we fully appreciate sometimes it's difficult dealing with IT because different folks, different budgets, different constraints, so we try to satisfy those needs and those energies by leveraging our demo equipment. But if a customer comes and you say, I want to go, we want to put some test dev stuff, we want to spin up a few instances on Amazon. Can you help us? You would say, first of all, say, well, why Amazon? What do you do? We would ask them what's drawn them to Amazon. What are your objectives? Correct, we would work with them on, have you considered soft cloud? We would price that out for them. We would take those requirements. And probably at that point, they would be indifferent. So wait, so you would compete with software? No, no, we resell software. No, I'm saying you would compete in that situation with Amazon with a software alternative. You would not turn around and say, okay, hey, today we'll do Amazon, but tomorrow we might do HP cloud. That will do, you say, you're essentially selling, reselling an IBM solution. So the club in our bag would be the software club. But it would be based on principles and requirements that they have for that particular application. Got it. So we would ask them, can it be off-prem? Because software today is off-prem. Can it be virtualized? Is it an x86 workload? And then we would get through a bunch of gates and determining, is that a fit for an off-prem cloud-based solution? And then if it is, typically it would come down to a pricing exercise between Amazon and software. Who do you sell to? Is it the storage team? Is it the CIO combination of people? All of the above. We have relationships at the ground level, you know, the systems program level, right up to CIOs and VPs of lines of business. It really depends. Ideally, every reseller, every solution provider wants to get as high within the organization as possible. The budgets are shifting. It's really mastering the CXO suite. And that's not easy to do. And it's not easy to do without upsetting relationships that you held or have nurtured below for many years. So it's part of our evolution, but we typically, we're very strong in the data center. We're very strong in the infrastructure at the CIO's office and below. And how about the application heads? Within specific industries, yes. Stronger and some weaker. Which industries? Insurance, for sure. Finance, health, healthcare within federal government. I mean, those guys got a lot of juice, obviously. Typically. We're focused on a large enterprise. Yeah, great. All right, Robert, well listen, thanks very much for coming to theCUBE. Congratulations on winning the Winning Edge Partner Award for the second year in a row. Well done. Thank you very much. And appreciate your time. Okay, keep it right there, everybody. Stu and I will be back with our next guest. We're live. This is theCUBE. We're at IBM Edge. We'll be right back.