 Hello and welcome back to theCUBE's coverage of Red Hat Summit 2023 as well. Ansible Fest as well bundled in. I'm John Furrier, host of theCUBE. We've got a great panel here. We're going to unpack a customer who's transforming in real time and we've got the leaders of Red Hat and IBM here. We've got Reddy Goodler, who's the Vice President of Engineering at Elevants Health, formerly Anthem. John Granger, Senior Vice President of IBM Consulting. Put a busy day on conference, doing a talk to the analysts and the investors. Of course, Matt Hicks, President and CEO of Backdown. This is the highlight. This is a lot easier. Let me see the numbers. Matt, great to see you again. John, thanks for coming on. Ending your day with us. And I appreciate you sharing your story here. Glad to be here. So the first question, Reddy, is transformation sounds easy. What's your biggest pain point that you're working through right now? What successes have you had so far and what's ahead of you? So at Elevants Health, we started our journey to build good digital experiences many years ago. And as we went through this journey, we made significant investments in the last eight years. I'm very happy with some of the progress we've made. But when we looked at digital experiences as we're transforming the digital experience, the big challenge we faced is something to do with our core systems. We needed to modernize. We recognized the need to digitize our core, modernize our core applications. And so that, to me, is the biggest pain point. Like, how do we have a strategy that'll help us give better digital experiences? John, this is a question for you. What's the IBM Consulting Red Hat partnership? These are big problems. They're business transformations, not just technology. You've got business outcomes. Every application is driving the companies. What are some things you're working on with Red Hat? Yeah, so look, I mean, let's start with clients. When you think about the clients that IBM has and what you would see them to have in common, I'd call it mission critical operations, whether it's FS, telco, government healthcare. And I think what we found in the last two or three years is really that for those clients, when they look at cloud, a simple hop to the public cloud just isn't going to work for them. For reasons of cost, data security, the complexity of the mission critical applications that they run, they really need to look for something that's going to help them spread their estate across traditional IT, on-prem environments, private cloud, multiple public cloud. And if they do that, and if they can take advantage of a hybrid cloud architecture, then we can see very significant benefits, like two and a half times more value from that hybrid cloud architecture than just using a simple public cloud. And so obviously Red Hat brings all of that together. I mean, with the Red Hat stack, that combination of Kubernetes and containers and Linux, they are able to bring that fabric that enables you to build your applications once, deploy them anywhere. And most importantly, I think, and this is the real thing for me, is to actually skill your people once in this single hybrid cloud architecture and then use them anywhere. So you avoid the Frankenstein's monster of all the individual silos, yeah? And then to innovate anywhere with anyone's technology, the really exciting thing is you can use anybody's cloud once you've got this Red Hat architecture. So what we've done is we saw that opportunity. We built this big Red Hat practice, as Matt well knows. And we've got some great client examples, Delta, Discover, US Department of Education, where we've been able to really help our clients transform because we've had such a strong partnership with them. You guys have a great practice. We've covered a lot on Silicon Angle. Matt, let's build on the hybrid cloud thing. Reddy's got, he wants to move faster, have better apps, better user experience on digital, doing it in the open. And with the cloud, API has taught us to decouple. We've got now multi-party integrations. You can get best of breeds and stitch the platform together. And with open source, take us through your vision on how to make this happen because this is a huge accelerant. And with AI, with a tailwind, it's a great opportunity. It really is to John's point, I think, being able to run anywhere you need, whether that's use the data centers you have today, I'm expanding to public cloud, leverage edge. That's powerful. And then you have this workload accelerant of why I want to use AI. And I'm going to train in my data center, public cloud, I'm going to deploy at the edge. The ability for our architecture to fit those use cases, I think is great. But then there's also the shift, if I look at consulting, where you can have the desire for new technologies, but then do you have the skill sets to accelerate your use and use best practices? I started life as a consultant. And in those days, it was actually at IBM, I was doing Linux deployments. For the same reasons we're talking about today, I had the expertise. I could jump-start customers on their Linux journey. I think the same thing plays out today of using our expertise to jump-start you in open hybrid cloud. By the way, I just tweeted that before you came on, that you were starting your career in IT and now the CEO of Red Hat. So congratulations, you got the chops. And being a technical leader is a great thing. So you got to make these architectural decisions. Ready, this is an architectural game now, right? This is talking about distributed computing, on-premise, cloud edge, stitching together, middleware, there's all kinds of new things happening. How do you pick the right partner? Because now, you don't want to slow down. At the same time, you want to go fast, but you want options. Absolutely. See, if you look at any large transformation, and even large, any transformation journey, you need to start off knowing your current state. You need to know where you want to get, what kind of technologies, what kind of a skill set, what do you need to make it happen. And it's important to find the technology partners who can give and build the ecosystem around it to help support the transformation journey. And that's when, for example, in our situations, when we wanted to rewrite some of our mainframe applications which were built many decades ago, which evolved over a period of time, one of the first things we needed is a good baseline of our current state, good baseline of our requirements. And that requires us to build a very robust reverse engineering practice. And a reverse engineering means you need somebody who has a good mainframe knowledge, as well as the modern technologies. And so we worked with many technology partners, trying to, and then the process we learned. But working with IBM consulting during the process, we figured out like, we can automate. So we have now somewhat of a somewhat semi, a fully automated way of extracting business rules out of cobalt code, and now have a good baseline to start with for our developers and analysts. I guess my follow-up question would be real quick, how do you tend, you guys get called on all the time, people knock on your, hey, pitching you stuff, how do you tell the players from the pretenders when you do the evaluation? Oh, I would say actually that's a good question. So we do say when we started this journey, especially in this case of reverse engineering, when we asked a lot of vendor partners who did come up, people who have been working with us for many times, they did come up and said, okay, here are some solutions, some products. But deep down as the details are coming out, it was very evident, very evident that there are some vendors who have the expertise. They are the technology partners who bring the expertise and there are some who don't have it. So, so I guess it's actually in some cases, you do try around with a few vendors and then you finally land into the one that really has the expertise. But it's people in the end, isn't it? I mean, don't you, I mean, I, you know, when you're making that selection around expertise, it's really, you know, when the people stand in front of you and you can tell, you know, from how they pitch and their credentials, I mean, in the end, I think, you know, in the technology business, we can get, you know, seduced a little bit by all the whizzy stuff. But in the end, you know, if you've got somebody who really you can see has got that deep expertise and that comes over, as well as the backup and the references, then, you know, I think that's, you know, normally what, you know, what wins for us. And then the experience matters, right? We do know there's a track record, yes, references, yeah, we did run across some small vendors, some Silicon Valley vendors, which are great when they supported us, but then when it comes to scaling. Depth, yeah. We didn't, we did have some challenges there. You know, results now are accelerated, so you can really, really put that out on the table and see it in action. I think that's a big piece. Really appreciate you sharing that. Switching gears, John, I want to get back to this theme of the show, open collaboration. How do you see that rendering itself with the client's successes? How do you see that? How would you describe that? What is open collaboration? Well, look, I mean, I think open for us is, you know, is the recognition that, you know, no one company can have, you know, the monopoly of the technology solutions that they provide. And that's fundamental to today's IBM. I mean, one of the things that Arvin has changed is the whole, you know, sort of notion that, you know, that we need to collaborate, you know, with the ecosystem, we need to orchestrate, you know, we need to bring that together. And, you know, we've done a lot of work on that in IBM and in IBM consulting. I mean, at the same time we were building up this Red Hat business that I talked to you about, we've also built a billion-dollar AWS business and a billion-dollar Azure business. But in terms of how that really instantiates itself, then, you know, what we think is really important is, you know, something we call garage, which is a way of working when we bring our clients together, either physically or virtually, you know, into an environment with our technology and our partner's technology, and then really spin up very quickly through co-creation, a minimum viable product that you can then build out and move quickly. And I think that's really the modern, you know, instantiation of how that open collaboration really works. And then, you know, and obviously then, you know, being prepared, you know, to work in a very collaborative and trusting way with your strategic partners and ensuring that, you know, whether we're working, you know, with Matt and his team or whether we're working with AWS or Azure or SAP, that we're really building those, you know, solutions in together. Yeah, you're building. I mean, you're on multiple clouds. I think I covered your news at AWS. Yeah. I reinvented last year. Yeah, yeah. And multi-cloud is on the horizon. I mean, this is hybrid is winning. Or one, I should say one. Yeah, and I think, you know, I mean, you know, to your point, that hybrid I think is going to spread out then into the whole AI space because it's going to be multi-model on multi-cloud. I mean, that's, you know, where I think the future's going to be. Well, I would say too, I've talked about the impact of global creativity with AI. I think when you take consultants, they're there technical, they know customers, they can influence an open-source stack. I sort of feel like that's what drew me to both of those careers early on. That's a really powerful aspect of they're able to make products better in part of that journey too. Yeah. You bring that up. I had a rant on my last podcast with Dave. We do a weekly podcast. Now, one of my rants was, we have a rant section. The word guardrails, because like the word of the week, we're going to put guardrails down. It's a polite way of saying, we're going to drive hard. And we may bounce around a little bit. But we're going to stay in our lane, so to speak. We don't get too regulated. We don't want to get pulled back. It's an offensive move with AI, I think totally the way to go. Because we don't yet know what it is. And we said, if you regulated the web, it never would have exploded. So I think this idea of letting AI run a little bit needs guardrails. I think this brings up, this conversation here reminds me of this relationship is, if you want to go fast, you got to have trusted partners. You have to have an ecosystem, open ecosystem for verifying software supply chain. I mean, a lot going on. What's your reaction to that? No, I think it's critical. If you're looking at Ready's use case on this, I'm going to be making core decisions that impact people's lives. You want to know how that stack works. This is where I think IBM's expertise and Red Hat's expertise are incredibly complementary, where IBM's going to know the models. They're going to be able, whether it's indemnification of what models are built against data policies governance, they're really strong there. We play in the swim lane of, we're going to help you move those to any environment fast. Combining those for customers, I think is really powerful. You get the trust aspect, but you don't lose out on innovations by trying to put up too many guardrails or not adopt until it's perfect. I don't think we'll know it's perfect until we've put it through the basis. But that trust piece is going to be critical is because we're talking about enterprise here. And I mean, you know with boards, I mean the thing that all boards are asking our clients now, why haven't you done it? Why can't you go faster? And then at the same time saying, but hang on a minute, don't do any of it because we're really worried about where our data's going to be and so on. So you've got to find that trusted partnership that's going to allow you as an enterprise to move forward. John, that's a great point. That's why I like the guardrails in this context because you want to have trust. Think about rail, right? Think about Red Hat originally. They took open source operating system and they made it enterprise grade and they supported it. It's a very simple concept. Now look good enough. So now you got AI, how do you get that same dynamic? And I think IBM Consulting, I'm kind of riffing in real time here, but like with IBM Consulting and the Red Hat combo, you kind of get best of both worlds. You get full support and scale. IBM Consulting track record is phenomenal. But you've also got a brand that has stood over over a hundred years for having a really responsible approach to the introduction and new technology. And I think you can trust IBM in that regard. Well, Red, you got all the decision makers right here. So what's the asterisk for IBM? Let's go, let's get that discount. John's changing the plan. He was surprised to come down there. Yes, exactly. The Q's discount, let's go. Yeah, exactly. He gets no commission. I'm all open, I'm just referral. Pay it forward. John, close us out with the vision of IBM Consulting. You guys have had a great track record over the years. It's been well documented. World-class organization. You got Red Hat, you got the technologies, you got chops, got open source booming, AI's tailwind. So, so look, I mean, I think we want to double down on open collaboration as we've just been talking about. I think what distinguishes us in IBM Consulting is we're client first, with a point of view. So we're in no way tethered to IBM technology. We built our Red Hat practice because it's great and it's brilliant and clients want it, not because IBM bought it. And I think the second thing we want to do is really deepen our partnership with my friend Matt here to the advantage of clients and Light Ready and particularly in the space of generative AI because it's disruptive technology that excites us all. And so I think we really got to focus on that. And you're well positioned for the multi-cloud, super cloud where you can stitch together environments and stacks and abstract that away with software. OpenShift is doing really well. OpenShift AI and you got Ansible, Brocken here, awesome stuff. Well, thanks so much for coming on. Appreciate it, congratulations. Thanks for sharing your story here on theCUBE. Really appreciate it. Thank you. All right, that's it. Day one, coming to an end, we've got our wrap up coming up. Stay with more CUBE coverage. Go to siliconangle.com. Stories are hitting there. Check the Twitter hashtag, RH Summit. Check it out. We'll be right back with our next guests.