 The Cube at EMC World 2014 is brought to you by EMC. Redefine VCE, innovating the world's first converged infrastructure solution for private cloud computing. Brocade, say goodbye to the status quo and hello to Brocade. We're back, welcome everybody. This is Dave Vellante and this is Silicon Angles, The Cube. The Cube is a live mobile studio. We go out to events, we extract the signal from the noise. The first Cube we ever did was EMC World 2010. We're here at EMC World 2014. That was in Boston, we're of course now in Vegas. Mike Kaler is here. He's the Chief Operating Officer of EMC Global Services. Mike, welcome back to The Cube. Good to see you again. Thanks Dave, great to see you again. Yeah, so we're here at a little bigger stage than the Wikibon offices where we met you on the first time. So give us the update on EMC services. I've said a number of times, those of you who follow The Cube and follow Silicon Angle Wikibon services to us like the secret weapon. It's where the rubber meets the rotas where clients really get the value and bring that value to their organization. So give us the update on EMC services. So thanks, I absolutely would say the same thing. I describe our services portfolio as really the pointy end of the spear, right? Because it does start the dialogue and conversation with our customers about, in this case, IT transformation. So, you know, customers are still continuing on the journey to IT as a service. Kind of what's new, if you will, from the last time we spoke a year ago was a lot of CIOs, a lot of customers were saying, look, I'm in some state of the journey, but I really need to understand, am I head, am I behind, can you guys help me? Not do it all, but give me some benchmark, give me some baseline. And so we actually developed an IT transformation workshop. And this is not the end-all panacea of a strategy, but it starts the dialogue. So we spend a half a day with a customer really assessing where they are on their overall journey to the cloud, journey to IT as a service. We then benchmarked that against best in class, either across just every company that we've done this for, or we can actually benchmark it against industry vertical. So if you're in financial services, how am I doing against other financial services? And in that, you end up getting a report. And that report, again, doesn't solve it all, but it starts to give you, I'm ahead, I'm behind. And then for a CIO and its leadership team, helps them prioritize, how do I spend my money, where should I spend my money to further my overall IT transformation? And that has taken off like wildfire. We are 200 plus in the queue. And growing every day, because again, it starts the dialogue and CIOs love it. And that's a four-pay service? No, it's actually for four free. So it's a freebie? It's a freebie, yeah. So we, working with the client teams, and the commitment from the customer is, it has to be the senior leadership team, because you can't really have this dialogue at the director or the head of storage. So that's the commitment. It's really two half days. You do a half day of prep, and we do a half day of readout. And it's proven to be wildly successful, both for us as EMC, but also, if you think about the industry trend of IT as a service, we're helping drive that and helping lead that in the industry. Well, generally that's how the consulting, companies sell services, and it's a part of the pre-sales process. So I presume a lot of that is converting into business for you guys. It is. I mean, so there's parts of the overall transformation. We would say we've done that, we, better than anybody, have done many, many thousands of VMware implementations. So if you're starting with, hey, I'm going to move to the VMware, there's a proper dialogue that we can then go engage for fee to start to talk about the conversion from a physical world to a virtualized world as an example. Well, services have certainly changed over the years. I've been following EMC for a long time, and services used to be, basically install a symmetric, or some kind of break fix, or back of the day it used to be fix a memory board, but then it transformed. EMC started to acquire companies that had more of a sort of CIO affinity. I'm wondering, since the Federation model was announced, has that enabled you to get deeper into organizations and have more strategic discussions? So it has, I mean, what the interesting part is, is now with the Federation discussion, a lot of, EMC as the company didn't solve it all, they need VMware, and if you think about our core infrastructure on top of a virtualized environment, and now you get to where it really matters, which changing the applications themselves, Pivotal really matters, and then wrapping our RSA security around that. So it's starting for customers that want to go big, it's starting to have that four pillar approach, and so for us, this more partner-led, consultative engagement has taken on an ever-increasing life. The problem we've got, and the challenge we've got, is how do you scale that? Because it's so partner-intensive that we're starting to do that in a very handcrafted way with a small number of companies, but as the Federation starts to grow, customers are seeing real value in us, brokering, if you will, across the top of the overall Federation. Well, so there's no saying, right? If it ain't broke, don't fix it, but we heard from Pat Gelsing this morning that digital didn't look like it was broke, but a digital equipment corporation, but it was. So, IT transformation, is the driver for IT transformation because IT is broken in organizations? So not necessarily broken, two things have happened, right? It's been a disrupted marketplace. So one, it's about cost, and it's about speed and agility, and for like it or not, certainly in the enterprise space, customers have install bases, and any time you have an install base, you tend to slow down, and as disruptors have come in, like the Amazons and the Azures of the world, they're showing new business models that gave business users other alternatives for faster time to market. So it's requiring this change, but it's also, underneath that, financial models are changing, too. So those two things are really where we see a lot of conversations with the CIO, but that unto itself still doesn't change the game for business. It's not until you get to this next conversation around how do I take advantage of that with my applications? And so we're starting to see conversations we've had in previous years around big data, this notion of now it's really coming to life and what are customers doing with it? So what we're starting to see now is just like we're talking about A2 transformation, we're starting to see a lot of draw to, can we talk about a big data transformation? How do I take everything I got today and get it to the next generation of big data? And so that for us is an emerging market that's sitting on top of all of this IT as a service and pick your cloud broker, but really doing something with your apps and doing something with your data. So if I were CIO and I have all these disruptive changes, okay, you've mentioned some of the public cloud guys like Amazon and Microsoft and then the big data trend, okay, I buy it, I got to be data-driven organization and then of course, mobile. I don't need anybody to explain that to me. Okay, so I would look at it and say, okay, so these technology trends are very disruptive, but now we got to look at our process too. How do we exploit these trends and how do we really start with the process and what improvements can we make? Is that the place to start? What are you seeing and how does that trickle back into, particularly I'm interested in the data piece, are people becoming, are organizations becoming data-driven or is that a lot of talk? I mentioned it isn't some, it isn't others, but how do you go from process, you don't want to start with the technology. So talk about the process back to the technology. So in these IT transformation workshops, as I said, you kind of have an output and says, hey, here's where I am against the best in class industry. I'd tell you Dave, nine out of 10 times, the weakest link in this continues to be the organizational skills. And so almost, to your point, if it's a process, it's a technology, I'd actually say it's not either of those. It's just starting this journey with really changing and again, the conversation we have with customers is most of them are organized in the north-south silo of I-Do-Storage and I-Do-Compute and you can't break those walls down at the same time you're trying to talk about this next generation. Because of the install base. It's because of the install base and the human dynamic. People look at it and say, where do I fit in this? And subconsciously or consciously, it becomes a blocker on actually getting speed and agility. And so, like I said, nine out of 10 times, we have to come back to the organizations and say, let's create a package of education and dialogue around what are the jobs and then what are the skill sets and how can you help you and your IT organization actually get those skill sets and enable the growth of the individuals. So I flew out in the same flight with Tom Clancy and so you mentioned education. You guys have a pretty big force there. So is that what people are doing and organizations are they saying, okay, let's re-educate, educate our people or are they saying, let's reshuffle the portfolio. How are they dealing with the human capital management issue? Right, so a couple of ways. I'll give you kind of the best in class that we've seen. Best in class, job descriptions are just fundamentally different. And companies that are trying to make the transition, we see them stand up and hire individuals into those new job descriptions well ahead of ever being there on the technology and ever being there on next generation IT service. And it's almost the catcher and the builder of the new. The ones we've seen that don't go so well is everybody's trying to stay in there and maintain in their silos and they say once we build it, we'll then transform. And so there's a very diametrically approached approach. And again, as I said, best in class is spending ahead because the individuals in the organization then can see what the new structure looks like and see what good and success looks like and they actually want to go there versus wondering or looking at a whiteboard and thinking maybe one day this will change. And I can understand why that best in class is not necessarily being applied to all organizations because the CFO is going to say, how are we going to pay for this? And unless you save over here and you've got that chicken and egg problem, don't you? So you're saying best in class, but you have a, it's the Jeffrey Moore, you have the leading edge guys. That's right. What do you predict? Are those guys going to break out from the competition? I do. So this is, I use it a little bit of, you got to rob a couple of pop stands on the way to the bank and you've got to go create the room because there's no free money trees. And so that gets us into the secondary. So if you think about that next 60% that are stuck in the middle of the can't move forward, we then typically take a technology vein to that to say let's go after a small portion of the portfolio, go after targeted cost savings because we can prove that you actually, if you move to a more converged infrastructure, you move to as IT as a service, you will take cost under your current run rate. If you, Mr. CIF, can go have that conversation with your CFO about not giving that money up but using that as the reinvest, we start to see this success over success but it comes down a piece at a time. And that's secondarily if you will for a lot of organizations, that's how they've got to eat the apple. So I was at Service Now Knowledge last week and Frank Slutman gave a keynote and he said the CIO must become a business leader. And I said, come on, what CIO is going to be the business leader? And then of course, typical service now fashion, they had a guest in the Cube, his name was Atticus Tyson, he was a CIO event to it. He came out of the line of business, he was a P and L manager, an engineering manager. Are you seeing, I said, okay, check, that's one. And they had several other examples at the event. Are you seeing more and more CIOs come out of the business directly into the CIO world? We're seeing a few more but I wouldn't say. It's not common, right? It's not common and it's, I'm not sure I see it as a massive trend that's going to sweep. I agree, CIOs need to have business acumen skills but I'm not sure that you can take a complete business leader and actually drop them into a major IT transformation. So that confirms my sort of feeling that that's not going to be a likely scenario. So okay, so the biggest challenge of getting to IT as a service we find from Wikibon customers is the alignment problem. Understanding the business requirements and understanding how to build a service catalog and understanding what they actually did in meeting that need. What's the best practice in terms of doing that and how is EMC helping? Yeah, so I mean, back to this overall notion of a strategy. So again, best practice with our customers is take it down in something you can prove and you can go back to the business and show real value. And a lot of times, again, that becomes a cost envelope. So a lot of the discussions with our customers not about let's the big bang and go spend millions of dollars on new technology but it is what can you do for me this quarter, this month, this year to actually real return. And again, it may not be, quote, business value but it is cost and in some cases as we talked about you hold that cost because that starts to fuel the overall transformation. But it's laying out that roadmap and it's honestly creating a situation where the CIO can sit at the table and talk about a multi-year journey because lots of people want to come and say I'm going to save your life overnight. And then at least in the enterprise space that just doesn't happen. And either there's desperation and people take these wild bets that generally end in tears. But again, the best ones we see engage in the dialogue and go paint a vision but then take that vision down in multiple chunks that they can really return something to the business. All right, we'll leave it there, Mike. Thanks very much for coming on theCUBE. EMC services transforming itself over the past decade quite radically and helping customers transform on their journey to IT as a service. Mike, thanks very much for coming on theCUBE. This is Dave Vellante. We'll be right back with John Furrier right after this. This is theCUBE. We're live from EMC World in Las Vegas.