The dawn of a new era for Dell EMC

As an IT industry veteran with over 20 years of experience under his belt, Paul Henaghan is not new to the rumblings in the tech sector, including mergers and acquisitions that have seen IT suppliers come and go.

After all, the president of Dell EMC in South Asia and Korea had worked for webMethods, which was acquired by Software AG, and PeopleSoft, which was acquired by Oracle in a controversial hostile takeover. So when Dell and EMC came together as one company in September 2016, he naturally took things in his stride.

In a candid interview with Computer Weekly, Henaghan shares what Dell EMC is doing to streamline its salesforce, his views of the hyper-convergence space and the company’s strategy for tackling the diverse Asia-Pacific market.

How is the integration work between Dell and EMC coming along? How are the kinks being worked out, especially in the Asia-Pacific (APAC) region?

I joined EMC in 2015, and my entire career had been in software companies such as PeopleSoft, which was acquired by Oracle. I was also at webMethods, which was acquired by Software AG. So I’ve been through various mergers and acquisitions. When the merger between Dell and EMC was announced, I was excited because I loved the federation story of EMC around VMware, RSA and Pivotal. And C-level executives want solution providers to solve problems for them at a competitive price point, and EMC was capable of that.

One of the things I looked for during the merger process was whether the messaging around what we were going to do would be implemented. And it has been exceptional – everything that Michael Dell and the leadership team had positioned in terms of our go-to-market model, product alignment and investments have all been met. As a result, it has been beyond my wildest expectations. I still reassure people about the merger, and anonymous feedback from staff has been positive. However, one of the things we’ve been challenged by is to transition legacy technology environments into the new world. You don’t just flip a switch overnight. We have achieved a lot, but there’s still a long way to go.

What have you done to align the sales organisations of Dell and EMC, and present a single face to customers?

One of the things we’ve been very clear about in our go-to-market model is to have a primary account executive from Dell or EMC. We make sure we put the right person in the role to minimise churn, because customers hate to deal with new account managers – our industry is notorious for changing account managers every year and we don’t want to do that.

“You don’t just flip a switch overnight. We have achieved a lot, but there’s still a long way to go”

Paul Henaghan, Dell EMC

Sometimes we may have both Dell and EMC executives working with the same customer for a long time. When that happens, we will have a primary account executive, and the other person becomes the specialist for the product segment he or she has been supporting. For example, an EMC person may be a datacentre specialist who will bring together the hardware, software and services to support the primary executive, who may have client and compute expertise.

How crucial is APAC to Dell EMC? What is your strategy in tackling this very diverse market? Where do you see the growth coming from?

We have identified 18 tier-1 markets, and in this part of the world those markets are Japan, Korea, Australia, India and Singapore. Going one level down would be Malaysia, Philippines and Indonesia, where we are driving the digital transformation agenda.

We also have emerging economies like Vietnam, where we enable digital adoption and grow the awareness of Dell as a computer company. Michael Dell himself has a strong drive to ensure that we are supported, enabled and invested in growing our business in emerging economies.

What is Dell EMC doing to support digital transformation efforts in the region?

Our focus has been to support IT and workforce transformation among the largest tier-1 companies and public sectors in countries like Malaysia. In emerging economies, we have been making it easy for companies to go digital through solutions like VDI [virtual desktop infrastructure] and hyper-converged technology that can be rolled out much faster than in markets with established legacy platforms.

With VxRail, Dell EMC is making a bigger push towards hyper-convergence, a market that has a number of players delivering different solutions. How do you see the market playing out? Do you think hyper-convergence will become increasingly commoditised?

We announced during our first-quarter results that we grew that segment of our business by triple digits. While hyper-convergence is about simplifying the implementation, management, cost structure and speed of deployment of infrastructure, the reality is that organisations still have different requirements and legacies. That’s why our strategy is to offer a broad spectrum of hyper-convergence products such as the XC series, which is a large part of our business in the Asia-Pacific region.

At the same time, our VxRail business is growing exponentially. There’s also our VxRack software-defined datacentre technology that virtualises the server, storage and network environment. Our portfolio gives us the ability to provide completely integrated solutions or take elements that are most appropriate for current environments. In the high-performance workloads space, we have the VCE Vblock systems used by some of the largest hospitals in this part of the world to build their datacentres.

“It’s certainly not our view that things get thrown away after 12 months. Anything we do today should not and will not be a standalone environment from an integration and technology perspective”

As for commoditisation, what does it really mean? Does it mean going mainstream and that there’s no value associated with a solution? Or does it mean there are a hundred providers of the same technology? I don’t really know, but what I will tell you is that it is certainly a competitive market and that there’s still a need for the ability to plug in a system and boot up in a seamless manner, and manage an entire infrastructure from a single interface. If you deliver all of that into a competitive market, does it mean you’re being commoditised? Of course, there are challenges in terms of price-points, but at the end of the day, we don’t believe hyper-convergence is being commoditised. We believe it’s a growing marketplace and it’s good news for us that there’s growing adoption.

Who are the target customers for Dell XC and VxRail? Are there any overlaps in the customer segments you’re addressing?

There’s potential for confusion. It all starts with understanding customer requirements – if they are currently running XC, we will continue to support them and there’s no strategy to change that. And if they have a VMware environment, we’ll focus on VxRail.

If it’s a net new customer, the decision comes down to the technology they’re using. If they’re a strong Microsoft shop, we’ll work with them on the XC series. And if there’s a potential for us to position a VMware solution, we will do that. It’s about providing the right solution for the right environment.

Dell EMC recently announced the availability of consumption-based pricing. What does that mean for customers?

First, we’ve always had global financial services within EMC, and that allowed us to drive operating expenditure-driven sales engagements with customers, such as workload-based pricing models. Dell Financial Services had a similar model on a much larger scale than EMC did, and we’ve brought those two together.

Second, if we went to an organisation five years ago, we could extrapolate its growth plans and map out its compute and storage requirements because everything was application-centric. Today, organisations struggle to extrapolate their requirements for longer than 12 months, whether it’s supporting the internet of things or big data. The utility concept of procuring something as and when you need it – and testing something for a period of time – will help a lot. We wanted to support that with a consumption-based model.

How would the consumption-based model work with hardware? What would you do with the inventory that a customer may not need after a short period of time?

It’s certainly not our view that things get thrown away after 12 months. What we’re very conscious about is to provide the flexibility and capacity to scale out, so anything we do today should not and will not be a standalone environment from an integration and technology perspective, whether it’s adding spinning disks or solid-state drives. That is a critical part of our infrastructure and our differentiator in a competitive market.

Do you think there will be a point when enterprises get fully comfortable with public cloud services, and not bother with running private or hybrid clouds in any form?

If I was a startup and looking to implement an HR [human resources], CRM [customer relationship management] or financial application, I would be looking at software as a service. Whether it runs on a public or private cloud depends on the application. For established organisations running their own infrastructure and are looking at the agility, flexibility and cost-effectiveness of cloud technologies, they may consider a hybrid cloud environment.

However, not all clouds are the same. When we work with a customer that is using cloud technologies, we make sure the availability and security of their data remains the same regardless of what they’re using on the back end.