 Live from Orlando, it's siliconangle.com's continuous coverage of Sapphire Now, the Cube powered by EMC, where information lives. We're here at SAP Sapphire for continuing coverage of Silicon Angles, the Cube, where we're cube casting live with a special guest, David Vellante, senior analyst of Wikibon and I are speaking with Tom Peck, the senior vice president and CIO of Levi Strauss, which is a really big deal because at SAP a tech conference, it's now a business conference, a lot of partners and ecosystem announcements. I was just met with the CEOs of SAP, a lot of great, you know, vibe here, a whole new SAP, but Levi's is a big success story. You guys were a proof of concept case study with SAP and EMC. So Tom, welcome to the Cube. Thank you, glad to be here. Thanks for having me. And tell us quickly what's going on with why you're here and then talk about what's going on with Levi's these days. Sure. Thanks again for having me. First of all, a quick introduction to Levi's is the CIO of one of the largest casual apparel companies. We have three brands, Levi's, Dockers and our signature brand. We're 110 countries around the globe. And I have the honor and privilege of running the technology around the globe for the company, everything from our retail systems and point of sale to our global supply chain, demand forecasting, planning, corporate systems, HR payroll sourcing and clearly the infrastructure. We as a company are doing some great things. We're transforming ourselves. We have huge, huge growth plans, investing in new product lines. We've got retail growth strategies. We are moving from what today is largely a very regional based model of how to run the business to more global brand led way of running the business. And what's happening is it's putting a lot of pressure on us as an IT function and technology function to enable the company to grow and scale and still perform and move IT from what is historically a very back office behind the curtains function to a very front office growth engine to help grow the company's revenues. So a lot of exciting things going on. I look forward to sharing some of those little interesting background too. You were at MGM Mirage, right? And NBC Universal. So Levi a little different, a little different gig for me. Yeah, many, many years at GE and NBC Universal, consumer products and theme parks and home video and very customer consumer facing and then off to MGM Mirage again, very consumer customer facing come from a background where the consumer is, you know, centric and the technology's got to always work, always on mentality. And that's really why we're here. Celebrating some of the infrastructure successes we've had with SAP and sharing the success specifically of what we've done in our proof of concept with VCE and the V block technology. One of the things that we've been talking about here, it's looking angle on the cube is this idea of transformation at scale. And obviously the consumer business they've been involved in trying to get close to the consumer understand trends, market intelligence. But now that's everything it is now consumerized. So you have essentially all these tools, software and real time capabilities. That's a challenge and most companies struggle with that. So let's talk a little bit about, you know, how you handle that. And then let's dive into the SAP case study. How do you look at that? And how do you organize your your your thoughts and your roadmaps and your product plans? Sure. Like I said, we're over 110 countries around the globe. And one of the challenges that we have, we're burdened a little bit by those siloed infrastructure and siloed systems that we've been talking a lot about the past couple days. And with time zone constraints and maintenance windows and batch programs, it's really hard to get to the mobility and the reach that SAP has been talking about. And that always on and that real time mentality. That's what we're really trying to strive for. So what what we're doing as a company is trying to consolidate our technology stack in our platforms, SAP is quarter that strategy. And some of our infrastructure partners, we want to streamline our solutions, drive capabilities that are global in nature, you're seeing our organization change from, again, regional and country located to more global centers of expertise where we can drive depth of knowledge and depth of understanding while also having business engagement IT professionals out there with the client and with our business partners to drive demand and requirements and business analysis. So you're seeing us go through a transformation as a company where we want to work with fewer technology providers, more strategic partners and have the talent in house that can can do on premise deployment of hardware and software, but at the same time, can leverage some of these, these newer technologies that we've been talking about at SAFAR the last couple days, because absolutely right trying to simplify standardized drive to real time. The CEO, the board, our business leaders all demand always on real time information and cost containment. And it's really hard to do all of that. Sometimes they're usually exclusive. But some of the things we've been talking about here help enable that the role of the chief technology officer, the CIO and the geeks in the company says move from glasshouse behind the curtain, as you mentioned, to much more strategic role and the things that you're talking about. Talk a little bit about what's changed. We were talking earlier about the vendors, technology, selling technology, you talk about silos, talk about what's changing as a role of the CIO and the organization and the fit there. You were talking about business outcomes, right? And it's not about technology anymore. Just talk a little about what's changed just in the past five years or two years. Well, first of all, shame is plug, I'm surrounded by some great people, great business leaders, my CTO Bart Hecht and the head of my SAP shop, Tammy Emerald, and many other VPs on my staff. We we all share a lot of the same vision and the transformation that's going on. I think a couple of things are really driving some of the change, at least from my perspective. I think that the the first thing is, we're seeing or at least I'm seeing the old school of putting technology in to put technology in and enhancing your resume, based on the size and scale and the number of servers you support and how many data centers big is not always good anymore. Okay, simplification, standardization, consolidation, small, less complex, simplified is actually good. So you're seeing a change in mindset of simplification mandate that's coming out. That's a crucible. That's not just throwing money at things and stacking up servers or it's really being smart. Exactly. And I think that the partners and the vendors that we deal with the message to them is not that we're trying to necessarily save money and spend less money with them. That's not the point that may or may not be true, but we want to redeploy money from back end infrastructure to more front office revenue enhancing business value and productivity. And that's true of our resources as well. So help us save money and drive automation productivity on the back end and consolidate and simplify, which allows us to redeploy and shift to the front end. So I think that's a major shift. I think that the other thing that's not necessarily new, but we're driving this pervasive in our culture is the mindset of technology and IT to be a break fix organization to react to problems and to reward heroes for fixing fires is shifting to a more preventative anticipation proactive, reduce failure modes and try to forecast problems ahead of time and build that resiliency and that reduction in failure modes into your environment early. And new IT culture mindset. Exactly. The beepers kind of. Exactly. And you know, there's always a need for break fix. There will always be. And you know, one of the benefits of the VCE coalition and the V Block and cloud computing is a more general topic is shifting that the the spend mix away from maintenance and more to programs projects. And you know, that's that's nothing new again. But now we're actually seeing the reality of the technology and the services that that can actually help move that needle a little further. What do you think that comes from? Is it? I mean, it's probably a combination of things, but you got Google, you know, driving the consumerization of IT, although you know, you're really running your business on Google and Amazon. You've got maybe is this, you know, CEO or the business lines driving it is a technology maturity. All of the above. What do you see there? I think it's I think it's a little bit of everything. I think that our business leaders are much more technology savvy and hungry than in decades past. I think technology more than ever before is critical to enabling the business at the end of the day. For most companies to include Levi's, our brand, our product and our consumers ultimately our core, the technology and creative thinking good process is absolutely an enabler. So you're starting to see a very top down board driven CEO driven leadership driven mandate for IT to be better, faster, cheaper. And you're also seeing the technology sector in general start to transform. I think, you know, most of our partners realize that they need to be different in the quick story I like to share is one of the the catalysts behind getting us involved in the whole V block and VCE coalition is I was burdened with multiple technology companies selling me and silos, their their pieces of solutions. And ultimately, CEOs like me, I'm not really interested in buying technology. It's commoditizing over time. I want to buy solutions to solve business problems. And if you want to virtualize SAP, then bring VMware with you, bring EMC with you, bring Cisco with you. So several months ago, we brought about 50 of the smartest engineers and executives from this coalition to Palo Alto, we got together, we started brainstorm. And that happened to be about the same time this VCE Acadia coalition was forming. And so what you're starting to see is the the vendor ecosystem out there is now becoming much stronger and much tighter link. And people like me are now buying solutions instead of commoditized boxes or standalone products. Let's break that down. I mean, let's talk. So from Palo Alto, that meeting you had that meeting, you're involved in this case study. What happened? Let's tell us through that process. Sure. I think that technology companies are always interested, obviously always interested in getting proven success stories out there and customer testimonials. Clearly, especially like Levi's, I mean, a big customer, big brand, we're an iconic brand and one of the largest casual apparel companies on the planet and a large SAP shop. And I think that, you know, with all due respect to technology companies out there, the best way to sell a product is through a customer testimonial, especially from a brand and or a CIO and or a peer that you trust and know. So I think that the coalition saw value in that they saw that my team and I and the company in general had a very proactive vision on how to leverage the infrastructure and the technology going forward. So we created this win-win situation. We had some of the best and brightest from the coalition partners across, you know, SAP, Cisco, EMC and VMware and Accenture come together with some of my best people. And in a very methodical, detailed, it's kind of unusual. It's not normally like they don't see this very often. No, no, I mean, we had a project lead assigned to it. We had regular meetings. We set up a working lab. We've we physically made a copy of our production environment of SAP put it in a lab. I mean, this wasn't some half baked lab concept. This was the real deal. And we tested it under load. And we got some of the best people from from the ecosystem involved. And you know, that could never have been sold to me in a PowerPoint. Seeing it live testing it and seeing the investment from the VCE partners, ultimately is what, you know, proved it to work. And, you know, back to the question of what's changing, that's that's key to what's changing, you know, that the technology is commoditizing. It's about the ecosystem, how it comes together to solve my problems. It's interesting. You so you basically created this sort of virtually integrated team. You broke down the silo. So integration drives value, right? It's critical. I wonder if you could talk a little bit about the dynamic of virtualizing SAP, right? That gives a lot of people some concern, right, like a legacy application that works. I don't want to mess with it. But at the same time, you've got the tension to increase the speed of your business, lower your costs. So how did you sort through that dynamic with your team? Sure. You know, Levi's, as most companies have been virtualizing for quite some time last several years, but it's largely server based virtualization. And it's all good. You know, the solutions, the software, you know, VMware, it's all good. But there's a need to do more to go above and beyond that. And let's be real candid until you can virtualize your core ERP system. Everything else is kind of secondary. Many people who have gone through large ERP implementations are largely risk averse. SAP, in particular, it's a big, big deal. And you never want to you never want to put your production, you know, project, it's a long process. And it's it's it's hard. You're done. Yeah, don't touch it. Right, right. And you know, we we've virtualized our development test environment today, leveraging existing partnerships and it works. Okay, but nobody wants to be that first to virtualize production, especially with a company of our size and scale and the volume and the transactions that we do around the globe. And it's only going to get more challenging going forward because I'm talking about merging today, what are three independent ERP implementations into one global SAP process. So it's only going to get more problematic and more challenging over time. But but yeah, breaking down the silos, bring bringing the partners together. And you know, figuring out how to make people like me, and my staff and more importantly, my board, my CEO and my business partners comfortable that that this is a calculated managed risk that it's that it's not it's not too bold. It's not too far out there that it's not vaporware that it's real. And it's valuable. And it's valuable. The challenge, though, I would I would argue is where we have a little more work to do is you'll hear me and people like me talk about the TCO and the value but the value needs to be spoken in terms of incremental value over our existing path. Okay, we're already virtualizing today. So you can't assume the TCO and the value over a do nothing approach. Most companies are not doing nothing. It's it's an incremental. And that's where most tech companies need to polish their their sales techniques a little bit. What's the incremental value? And I think that the the second thing to get some more more traction in general for production SAP is this is not something you just pop in and flip a switch you have to align it with the roadmap or what I call a life event, whether it's a refresh cycle or a major deployment or a major SAP rollout. It's it's not something that I'm just going to pull off a shelf and put a new box in there. So there's a lot more work to do to take it to the next step. Well, talk about the emcee component because I've seen this big announcement here. You're part of that let's drill down on that specific. Yeah, we were at emcee world last week, we had the cube there. And we were asking the question a lot like why does the CIO care about infrastructure? Like what does it matter? So be interested in sort of hearing what your perspectives are on that. Sure. Well, emcee in particular, a great company long time partner bars, not only in my Levi's role, but going going way back in multiple roles in emcee's transforming from not just a storage company anymore to be in a more full service technology provider. And we're pretty excited about that and pretty excited about, you know, how they're working with the with the coalition partners because again, it comes back to I'm less interested in buying storage and I'm less interested in buying servers and I'm less interested in buying software it's the bundled package that I'm really interested in. And when when emcee can come together with other hardware providers like like a Cisco in software companies like a VM or an SAP and sell me solutions. That's really good. And the infrastructure doesn't get a lot of glory. It doesn't get a lot of press. It's not cool. It's not always sexy. It doesn't always sell new product. The board, the CEO, the leadership team doesn't always appreciate it sometimes. But at the end of the day, it's really the heart and soul of what makes the company work because if a server goes down, if a storage array goes down, you know, the application doesn't work and I cannot sell and ship product. So again, proactive it mission critical. Absolutely. You're out of a job doesn't work. Absolutely. And it's that shift in culture that we were talking about earlier, moving away from break fix to always on and having the partners in a technology that that allow you to deliver that. And, you know, to me, we can't just keep throwing redundancy and scale at our environment because it just that creates that that technology that server sprawl we've all talked about. Because the more you sprawl, I mean, the more failure modes, the more cost, we've got to be simplified fix you need to exactly. And that's why the V block, which to me, at the risk of oversimplifying, I don't want to call it an appliance because that doesn't do it justice, but to have an integrated solution across the stack, to me is of huge value because it not only simplifies and reduces the infrastructure, but it helps improve my uptime. It helps improve my performance. And I don't have to manage all those multiple failure modes. And the less time I'm doing break fix, and the less time my team is supporting multiple components of an infrastructure, I can redeploy those resources, the time, the talent dollars again, the focus on the programs, the mobility, the front office, the consumer facing and help the boss sell more product. Yeah, revenue. Right. Yeah. So you talked about managing your risk before doing that intelligently. So talk a little bit more about how you're managing your risk. In this case, obviously, there's a proof of concept going on. So so why is that important? And how do you actually offset some of that risk and mitigate it? Sure. Well, we're the the rigor and the discipline of our testing process is very clearly the easiest answer to manage that risk, just having the discipline and the talent to go through the testing processes. Okay. I think what what else we need to do is it's not just managing the risk of a new product and new deployment or new strategy. It's about understanding the risk of your current state or arguably the risk of do nothing. Which is an alternative and our do nothing alternative has its own set of risk. There is a huge amount of value to be had in in driving improved disaster recovery and business continuity. There's a huge amount of value to have in reducing downtime where you're doing hot ads and adding memory and scalability and CPU. So you've got to balance the risk and the reward. It's kind of stating the obvious, I guess. It's like your R&D department. You need to be you need to be tinkering and playing around. Exactly. New areas, right? That's what you say. Exactly. And much like we do on the product for Levi's, we have a similar mindset with the technology. It's all about test and scale. Okay. We'll test it. We'll scale it. And if it works, we just keep deploying it, growing it and moving over time. So what historically people will test in a dev environment and they might do it and test and eventually it might get to production someday. Test, test, test. That's the motto, right? Exactly. And people like me, you know, in many cases, I don't want to even get into that business. I prefer just in many cases, somebody does it for me. Yeah, yeah. Because every minute like a coalition like Cisco. Exactly. Everywhere, EMC, SAP. Exactly. Every minute that that we're talking about testing something is a minute that we're not talking about growing a business. So it's ecosystem. It's process. It's a intelligently phased approach and then evolve the innovation over time. And that's a great summary. And most importantly, I need the application owner, in this case SAP, to give their stamp of approval and their certification. Because at the end of the day, if you have the best hardware, network, database, commodity, package, box, whatever it is, the application software owner doesn't endorse it, certify it and support it. I won't pay attention. What is that certification process? I mean, there's been some different discussions around the on the blogosphere around SAP's compliance and certification. How hard is it? Can you have any visibility into that process at all? Yeah, we have we have some visibility and it ranges from everything from making sure the patches and hot fixes are aligned, the versioning are aligned across the different vendors and the different stacks. But you know, when I talk about certification, I'm talking about not only that, but I'm also talking about the support ability. I want to know how to escalate who to call if something goes wrong. Okay, I want to know that I'm on an upgrade path. I want to know that I'm not out on my own doing some kind of customization or something that's different. I want to know that when something goes wrong within a V block, okay, and I call SAP that there's a problem. People aren't going to do this and blame everybody else that there's an escalation, a chain of command and some kind of problem resolution structure. So that's really what we're talking about certification because I don't want to be out there struggling finding problems as an early adopter of fast follow. But not everyone gets certified, right? I mean, it's like pretty select vendors. Right? Yeah, I think that that's that's true. And we don't want the certification process to be a rubber stamp type of a process where, you know, hey, hey, it works. You're running your business on it's got to be real deal. Absolutely. Absolutely. And that reinforces that you know, the importance of the ecosystem. Yeah, we well, I wanted to bring up we've been talking last couple of weeks about the stack wars, right? Yeah. And you see now with Oracle acquiring Sun, IBM and HP have very, you know, rich stacks, right? Really trying to take control of the IP. And you're seeing EMC and VMware take a dramatically different approach, right? It's the partnership approach with Cisco now SAP, the services company we had Howard Elias on. I don't know if you know Howard, he runs EMC's services division. They call cloud services. Right. And he said we asked them, are you going to go buy a service company like Dell, but they said absolutely not it's a means to an end. So this coalition has put together different pieces of the of the ecosystem. It's really totally different philosophies, isn't it? And you've seen the industry evolve over the last 20 years or so. What are your thoughts on that whole progression sure of stacks? Yeah, it's the stack wars. It's kind of fascinated actually in a recent town hall with my department, we actually talked about what's going on because what's going on in the tech sector where you see some of the, you know, the 10 largest technology companies in S&P 500, in the cash and the strategies they have about growing and acquiring their business. It really influences how we as CIOs and technologists procure product, how we partner, how we negotiate, how we align ourselves. You know, today we've been talking about VBlock, but I'm also, you know, an HP customer. I'm also an IBM customer, I think very highly of those companies as well. And how do you, you know, what I'd like to call peacefully coexist and I tend to lean more towards a seamless integration.