 From Boston, Massachusetts, it's theCUBE, covering Red Hat Summit 2017, brought to you by Red Hat. Welcome back to Boston, everybody. This is Red Hat Summit, and this is theCUBE, the leader in live tech coverage. I'm Dave Vellante with my co-host, Stu Miniman, and John Hodgson is here. He's the Senior Director of IT Program Management at Optum Technology. John, good to see you. Good, good to be here. Fresh off the keynote, we were just talking about the large audience, a very large audience here, and Optum, you described a little bit at the keynote what Optum is, healthcare, sort of technology arm, which is not super common, but not uncommon in your world, but describe Optum and where it fits. So in the grand scheme of things within UnitedHealth Group, we have the parent company of Course UnitedHealth Group, our insurance side that does insurance, whether it's public sector, for large corporations, as well as community and state government type work as UnitedHealthCare, they do all of that. And then Optum is our technology side. We do really all of the development, both for supporting UHC as our main customer. They're truly our focus, but we also do a lot of commercial development as well for UnitedHealthCare's competitors. So big, big group, as I mentioned in the keynote, over 10,000 developers in the company, lots of spend. I mean, I think in the last year, our just internal IT budget was like $1.2 billion in just IT development capital. So it's huge. Yeah, it's mind boggling. John, can you talk, you've got that internal Optum cloud. Can you give us just kind of the breadth and depth you said, 1.2 billion there? What does that make up? What geographies does that span? How many people support that kind of environment? As far as numbers of people supporting it, I think we've got a few hundred in our enterprise technology services group that supports Optum cloud. You know, we started Optum cloud probably a half a dozen years ago and it's gone through its different iterations. And part of my job right now is all about enterprise cloud adoption and migration. So, you know, we started with our own environment. We call it UCI, United. It was supposed to be converged infrastructure, but I call it our cloud infrastructure. That's really what it is. And we've continued to enhance that. So over the last few years, I think about three and a half, four years ago, we brought in Red Hat and OpenShift. We're on our third iteration of OpenShift. Very, very stable platform for us now, but we also have Azure Stack in there as well. I think even as Paul and those guys mentioned in the keynote, there's a lot of different things that you can kind of pull from each one of the technology providers to help support what we're doing, kind of take the best of breed from each one of them and use them in each solution. Organizations are always complaining that they spend all this money on keeping the lights on and they're trying to make the shift and obviously cloud helps them do that and things like OpenShift, et cetera. What's that like in your world? How much of your effort is spent on sort of maintenance and keeping the lights on? Sounds like you got a lot of cool new development activity. Can you describe that dynamic for us? Yeah, we've got a really good support staff. You know, our group, SSMO, when we build an application, they kind of take it back over and run everything. We've got a fabulous support team in the background into that and it's on both sides, right? We have our United Healthcare Applications that we build that have kind of their own feature set because of what it's doing internally for us versus what we do on the Optum Insight side where it's more commercial in nature. So they have some different needs. So some of the things that we're developing even for cloud scaffolding that I mentioned in the keynote, we're kind of working on both sides of the fence there to hit the different technologies that each one of them really need to be successful but doing it in a way that it doesn't matter if you're on one side of the fence or the other, it's a capability that everybody will be able to use. So if there's a pattern on one side that you want to be able to use for a UHC application, by all means, go ahead and grab it, take it. And a lot of what we're doing now is even kind of crowdsourcing things and utilizing the really super intelligent people that we have, over 10,000 developers and so many of them. We've got a lot of legacy stuff, right? So there's some old school guys that are still kind of doing their thing but we got a lot of new people and they want to get their hands on the new fresh stuff and experience that. So there's really a good vibe going on right now with how things are changing, all the TDP folks that we're bringing in, a lot of fresh college grads and things and they love to see the new technologies, whether it's OpenShift or whatever, a lot of really getting into DevOps, trying to make that change in a big organization is difficult, we got a little ways to go with that. But that's kind of next up. You're an interesting case study because you got a lot of the old and a lot of cool innovation going on and is it, how do you decide when to go? Because DevOps is not always the answer, sometimes waterfall is okay. So how do you make that determination and where do you see that going? That's a great question, that's actually part of what my team does. So my specific team is all about cloud adoption and migration. So our charter is really to work across the enterprise. So whether it's Optum Insight, Optum RX, UnitedHealthcare, we are working with them to evaluate their portfolios of applications to figure out really legacy applications that we have that are still strategic. They've got life in them, they've got business benefit and we want to be able to take advantage of that but at the same time, there's some of these monolithic applications that we look at, how can we take that application, decompose it down into microservices and APIs and things like that to make it available to other applications that maybe are just Greenfield are coming out now but still need that same technology and information. So that's really what my team is doing right now. So we sit down at those teams and go through an analysis, help them develop a roadmap and sometimes that roadmap is two or three years long. Getting to fully cloud from where they're at right now in some of these legacy applications is a journey and it costs money, right? There's a lot of budget concerns and things like that that go with it. So that's part of what we help develop is a business case for each one of those applications that we can help support them going back and getting the necessary capital to do the cloud migrations and the improvements and really the modernization of their applications. We started the program a couple of years ago and found that if you want to hang your hat on just going from old physical infrastructure or some of the original VMs that we had and just moving over to cloud infrastructure and whether that's UCI, OpenShift, Azure, whatever, if you're going to do your business case on that, you're going to be writing a lot of business cases before you get one approved, right? It's all about modernizing the application. So if you fold in the move to new infrastructure, cloud infrastructure, along with the ability to modernize that application, get them doing agile development, getting down the DevOps path, looking at automated testing, automated deployment, zero downtime deployments, all of those things when you add them up together and say, okay, here's what your real benefit looks like and you're able to present that back to the business and show them speed to market, speed to value is a new metric that we have and getting things out there quickly. We used to do quarterly releases or even biannual releases and now we're at monthly, weekly, some of our applications that are more relatively new, health for me, if you go to the app store, that's kind of our big app on the app store. There's updates on a very frequent basis. So that's the operating model, really, that you're talking about, essentially, driving business value. And we had a practitioner on a couple of weeks ago and he said, if you just lift and shift to the cloud and you don't change your operating model, you won't get a dime. Yeah, you're missing the bubble. Maybe there's something, some value there a little faster but you're talking about serious dollars if you can change the operating model and that's what you've found. Yeah, absolutely and that's the, it's a shift and you've got to be able to prove it to the business that there's benefit there, right? And sometimes that's hard. Some of these cloud concepts and things are a little nebulous, so. It's hard because it's soft. It's soft, right? Yeah, I mean you're putting the business case together. The hard stuff is easy to document but when you're talking about the soft benefits and you're trying to explain to them the value that they're going to get out of their team, switching from a waterfall development over to Agil and DevOps and automated testing and things like that where I can say, hey listen, you know your team over here we took them out of their pocket from actually doing their day jobs for the last week because they needed to test this new version. If I can take that out of the mix and they don't have to do that anymore and they can keep on doing what they're doing and not get a week behind, what value is that for you? And all of a sudden they're like, oh really, we don't have to do that anymore? But no, we can create test scripts and stuff. We can automate your deployment. We can make it zero downtime. We have, there's an application that we're working on now that has 19,000 individual desktop deployments. And we're going to automate that, turn it into a software as a service application, host it on OpenShift and completely knock that out. I mean deployments out to 19,000 people take weeks to get done. We only do a couple thousand a week because there's obviously going to be issues. So now you've got help desk tickets, you've got desktop technicians that are going around trying to fix things or dialing in, remoting into somebody's desktop to try to help figure that all out. We can do the whole deployment in a day and everybody logs in the next day and they've got the new version. That kind of value in creating real cloud-based applications is what's driving the benefit for us and they're finally starting to really see that and as we're doing it, more application, product owners are going, okay, now we're getting some traction. We heard what you did over here, come talk to us and let's talk about building a roadmap and figuring out what we can do. John, one of the questions I got from the community after watching your keynote was they want to understand how you handle security and enforce compliance in this new kind of cloud development model. I mean that's beyond me. All I can tell you is that we have one of the most secure clouds out there. Our private cloud is beyond secure. We're working right now to try to get into the public hybrid cloud space with both AWS and Azure and working through contracts and stuff right now but one of the sticking points is our security has to be absolutely top-notch. If we're going to do anything that has HIPAA related data, PHI, PII, PCI, any of that, it has got to be lock-solid-secure and we have a tremendous team led by Robert Booker. He's absolutely fabulous. I mean, our whole goal is security-wise is don't be the next guy on the front page of the Wall Street Journal. You mentioned public cloud. How do you make your decisions as to what application, what data can live in which public cloud? You said you've got Azure Stack and you've got OpenShift. How do you make those platform decisions? Well, right now, both OpenShift and Azure Stack are on our internal private cloud. So, we're in the process of kind of making that shift to move over towards public and hybrid cloud. So, I'm working with folks on our team to help develop some of those processes and determine what's actually going to be allowed and I think in a lot of cases, the PHI and protected data is going to stay internal and we'll be able to take advantage of hosting certain parts of an application on public cloud while keeping other parts of the data really secure and protected behind our private cloud. Red Hat made an announcement this morning with AWS, with OpenShift, sounds like that might be of interest to you and how would that impact what you're doing? Absolutely. Yeah, in fact, I was talking with Jim and Paul back behind the screen this morning and we were talking about that and I was like, wow, that is a game changer. With what we're thinking about doing in the hybrid cloud space, having all of the AWS APIs and services and stuff available to us, part of the objection that I get from some folks now is knowing that we have this move towards public and hybrid cloud internally and the limitations of our cloud, our private Optum cloud is never going to be AWS or Azure. It's just not. I mean, they've spent billions of dollars getting those services and stuff in place. Why would we even bother to compete with that? So we do what we do well and a big portion of that is security. But we want to be able to expand and take advantage of the things that they have. So that's this whole announcement of being able to take advantage of those services natively within OpenShift. If we're able to expose that even internally on our own private cloud, well, that's going to take away a lot of the objections I think from even our own folks who are waiting to do the public hybrid cloud piece. When the Affordable Care Act hit, did your volume spike and as things, there's a tug of war now in Washington that could sort of change again? Does that drive changes in your application development in terms of the volume of requests that come in and compliance things that you have to adhere to? And if so, does having a platform that's more agile, how does that affect your ability to respond? Yeah, it does. When we first got into the ACA, there was a number of markets that we got into and there was definitely a ramp up in development, new things that we had to do on the exchanges, stuff like that. We even had groups from Optum that were participating directly with the federal government because some of their exchanges were having issues and they needed some help from us. So we had a whole team that was kind of embedded with the federal government helping them out just based on our experience doing it. And yeah, having the flexibility in our own cloud to be able to spin up environments quickly, shut them down, all that is really, it's invaluable. So the technology business moved so fast. I mean, it wasn't that long ago when people saw the first virtualized service and went, oh my gosh, this is going to change the world. And now it's like, wow, we got to do better and the containers and so you've gone for this, like amazing transfer, I mean, I think it was 17 developers to 1600, which is just mind-boggling. Okay, and you've got technologies that have helped you do that, but five years down the road. There's going to be a what's next, a what's next for you as you sort of put on your, break out your telescope, what do you see? I got, I don't know. I mean, I never would have predicted containers. Even though they've been around forever. Yeah, I mean, when we first went to VMs, back in the day, I was a guy in the server room racking and stacking servers and running cables and doing all that. So I've seen it go from one extreme to the next. And going from VMs was a huge switch. Building our own private cloud was amazing to be a part of. Yeah, and now getting into the container side of things, hybrid cloud, I think for us, really the next big step for us is hybrid cloud. So we're in the process of getting that, I assume. I think by the end of this year, early next, we'll be a few steps into the hybrid cloud space. Yeah, and then beyond that, gosh, I don't know. So that's really extending the operating model into the hybrid cloud notion, bringing that security that you talked about, and that's a, you've got a lot of work to do. That's a big task in itself. Let's not go too far beyond that job. All right, well, listen, thanks very much for coming to theCUBE. It was really a pleasure having you. Yeah, thanks for having me, guys. Appreciate it. You're welcome. All right, keep it right there, everybody. Stu and I will be back with our next guest. This is theCUBE, we're live from Red Hat Summit in Boston. We'll be right back.