Inside Story: How HP Inc. Moved from a Rigid Legacy to Data Center Transformation

Transcript of a discussion on how a massive corporate split led to the re-architecting and modernizing of IT to allow for the right data center choices at the right price over time.

Listen to the podcast. Find it on iTunes. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Dana Gardner: Hello, and welcome to the next edition of the BriefingsDirect Voice of the Customer podcast series. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on digital transformation success stories.

Gardner

Our next data center architecture modernization journey interview explores how HP Inc. (HPI) has rapidly separated and modernized a set of data centers as part of its splitting off from what has become Hewlett Packard Enterprise (HPE).

We will now learn how HP Inc. has taken four shared data centers and transitioned to two agile ones, with higher performance, lower costs, and an obsolescence-resistant and strategic infrastructure design.

Here to help us define the data center of the future are Sharon Bottome, Vice President and Head of Infrastructure Services at HPI, and Piyush Agarwal, Senior Director of Infrastructure Services, also at HPI. Welcome to you both.

Piyush Agarwal: Thank you.

Sharon Bottome: Thank you.

Gardner: We all know the story of HP Inc. splitting off into a separate company from HPE in 2015. Yet, it remains unusual. Most IT modernization efforts combine -- or at the least replicate -- data centers. You had to split off and modernize your massive infrastructures at the same time, and you are still in the process of doing that.

Sharon, what have been the guiding principles as you created new IT choices from a combined corporate legacy?

Split-second reaction 

Bottome: When the split happened, leadership had to make a lot of decisions around speed and agility just to get the split done. A new underlying IT infrastructure wasn’t necessarily the key decision maker for how the split went.

Bottome

We therefore ended up on shared infrastructure in four data centers, which then ended up being shared again as HPE split off assets to Micro Focus and DXC Technology in 2017. We ended up in a situation of having four data centers with shared infrastructure across four newly separated companies.

As you can imagine, we have a different imperative now that we are a new and separate company. HPI is very aggressive and wants to be very fast and agile. So we really need to continue and finish what was an initial separation of all of the infrastructure.

Gardner: Is it fair to say, Piyush, that this has been an unprecedented affair at such scale and complexity?

Agarwal: Yes, that is true. If you look at what some of the other organizations and companies have done, there have been a $5 billion and $10 billion company that have undertaken such data center transformations. But the old Hewlett-Packard as a joint company was a $100 billion company, so separating the data centers for a $100 billion company is a huge effort.

So, yes, companies have done this in the past, but the amount of time they had -- versus the amount of time we are seeking to do the separation makes this totally unthinkable. We are still on that journey.

Gardner: What is new in 2018 IT that allows you to more aggressively go at something like this? What has helped you to do this that was not available just a few years ago?

Bottome: First, the driver for us is we really want to be independent. We want to truly transform our services. That means it's much more about the experiences -- and not just the technology.

We have embarked predominantly on HPE gear. We architected the new data centers using the newest technologies, whether it’s 3PAR, HPE Synergy, and some of the other hardware. That allows us to take about 800 applications and 22,000 operating systems instances and migrate those. It's just a huge undertaking.

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But by using a lot of the new technology and hardware, we have to then transform our own processes and all the services to go along with that.

Gardner: Piyush, what have you learned in terms of the underlying architecture? One of my favorite sayings is, “Architecture is destiny.” If you make the right architecture decisions, many other things then fall into place.

What have you done on an architectural level that's allowed this to go more smoothly?

Simpler separation solutions

Agarwal: It’s more about a philosophy than just an architecture, in my view. It goes to the previous question you asked. Why is it simpler now? Just after the separation, there was a philosophy around going to public cloud. Everybody thought that we would save a lot of money by just going to the public cloud.

But in the last two or three years, we realized that the total cost of ownership (TCO) in a public cloud – especially if the applications are not architected for public cloud – means we are not going to save much. So based on that that epiphany, we said, “Hey, is it the right time to look at our enterprise data center and architect it in such a way that it provides cloud-like functionality and still offers flexibility in terms of how much we pay?”

Having HPE Synergy as the underlying composable infrastructure really helps with all of that. Obviously, the newer software-defined data center (SDDC) architectures are also playing a major role. So now, where the application is hosted is less of a concern, because -- thanks to the software-defined architecture and best-fit model -- we may be able to move the workloads around over time.

Gardner: Where you are on this journey? How does that extend around the world?

Multicloud, multinational

Bottome: We are going from four data centers in Texas -- two in Austin and two in Houston – down to two, one each in Houston and Plano. We are deploying those two with full resiliency, redundancy, and disaster recovery.

Gardner: And how does that play into your global reach? How are you using hybrid IT to bring these applications to your global workforce?

Bottome: Anyone who says they are not in a multicloud environment is certainly fooling themselves. We basically are already in a multicloud environment. We have many, many platforms in other people’s clouds in addition to our core data centers. We also have, obviously, our customer resource management (CRM) as a cloud service, and we are moving our enterprise resource planning (ERP) into another cloud.

How do we support all of these cloud environments? We have partners along with us. We are very much out-sourced, too.

So it's a multicloud environment and managing that and changing operations to be able to support that is one of the things we are doing with this transformation. How do we support all of these cloud environments? We have partners along with us. We are using managed service providers (MSPs). We are very much outsourced, too. So it's a journey with them on learning how to have them all supported across all of these multiple clouds.

Ticketing transformed

Gardner: You mentioned management as being so important. Piyush, when it comes to some of the newer management capabilities we are hearing about – such as HPE OneSphere -- what have you learned along the journey so far? Do both HPE OneView and HPE OneSphere play a role as a continuum?

Agarwal: It’s difficult to get into the technology of OneView versus OneSphere. But the predictive analytics that every provider uses to support us is remarkably different, even in just the last five years.

When we were going through this request for proposal (RFP) process for MSPs for our new data center transformation and services, every provider was showing us the software and intelligence on how tickets can be closed -- even before the tickets are generated.

So that’s a huge leap from what we saw four or five years ago. Back then the cost of play was about being in a low-cost location because employee costs were 80 percent of the total. But new automation and intelligence into the ticketing systems is a way to move forward. That’s what will drive the service efficiencies and cost reductions.

Gardner: Sharon, as you continue on your transformation journey, are you able to do more for less?

Bottome: This is actually a great success story for us. In the new data center transformation and the services transformation RFP that Piyush was mentioning, we actually are getting $50 million a year in savings every year over five years. That’s allowed us, obviously, to reinvest that money in other areas. So, yes, it's been a great success story.

We are transforming a lot of the services -- not just in the data center. It's also about how our user base will experience interacting with IT as we move to more of these management platforms with this transformation.

Gardner: How will this all help your IT operations people to be more efficient?

IT our way, with our employees 

Agarwal: When we talk about IT services, there is always a pendulum. If you go back 15 or 20 years, there used to be articles about how Solectron moved all of their IT to IBM. In 2001, there were so many of those kinds of deals.

But within one to two years people realized how difficult it was. The success of the businesses depended not just on IT outsourcing, but in keeping the critical talent to manage the business expectations and manage the service providers.

Where we are now with HPI, over the period of the last three years, we have learned how to work in a managed services environment. What that means is how to get the best out of a supplier but still maintain the critical knowledge of the environment within our own IT.

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Our own employees can therefore run the IT tomorrow on some other service provider, if we so choose. It maintains the healthy mix of relationships between the suppliers and our employees. So, we haven’t gone too far right or too far left in terms of how the IT should be run from a service provider perspective.

With this transformation, that thought process was reinforced. We realized when we began this transformation process that we didn’t yet have critical mass to run our IT services internally. Over the period of the last one-and-a-half years, we have gained that critical mass back.

From an HPI IT operations team’s perspective, it generates confidence back -- versus having a victim mentality of, “Oh, it’s a supplier and the suppliers are going to do it,” that is opposed to having the confidence ourselves to deliver on that accountability with our own IT employees. They are the ones driving our supplier to do the transformation, and to do the operations afterward.

Gardner: We have also seen an increase in automation, orchestration, and some very powerful tools, many of them data-driven. How have automation techniques helped you in this process of regaining and keeping control?

Automation advantages 

Agarwal: DevOps provides, on the one hand, the overall infrastructure, orchestration, and agility to provision. Being part of the previous Hewlett Packard Company, we always had the latest and greatest of those tools. We were a testing ground for those tools. We always relied on automated ways of provisioning, and for quick provisioning.

If I look at that from a transformation perspective, we will continue to use those orchestration and provisioning tools. Our internal cloud is heavily reliant on such cloud service automation (CSA). For other technologies, we rely on server automation for all of the Linux and Unix platforms. We always have that mix of quick provisioning.

At the same time, we will continue to encourage our developers to encompass these infrastructure technologies in their DevOps models. We are not there yet, where the application tier integrates with the infrastructure tier to provide a true DevOps model, but I think we are going to see it in the next one to two years.

Gardner: Is there a rationalization process for your data? What’s the underlying data transformation story that’s a subset of the general data center modernization story?

Application rationalization remains an ongoing exercise for us. In a true sense, we had 1,200 applications. We are bringing that down to 800. The application and data center transformations are going in parallel.

Agarwal: Our CIO was considered one of the most transformative in 2015. There is a Forbes article on it. As part of 2015 separation, we undertook a couple of transformation journeys. The data center transformation was one, but the other one was the application transformation. Sharon mentioned that for our CRM application, we moved to Microsoft Dynamics. We are consolidating our ERP.

Application rationalization (AR) remains an ongoing exercise for us. In a true sense, we had 1,200 to 1,300 applications. We are trying to bring that down to 800. Then, there is a further reduction plan over the next two to three years. Certainly the application and data center transformations are going in parallel.

But from a data perspective -- looking at data in general or of having data totally segregated from the applications layer -- I don’t think we are doing that yet.

Where we are in the overall journey of applications transformation, with the number of applications we have, in my view, the data and segregation of applications is at a much higher level of efficiency. Once we have data center transformation and consolidated applications and reduce those by as many as possible, then we will take a look at segregating the data layer from the applications layer.

Gardner: When you do this all properly, what other paybacks do you get? What have been some of the unexpected benefits?

Getting engaged 

Bottome: We received great financial benefits, as I mentioned. But some of the other areas include the end-user experience. Whether it’s time-to-fix by improving the experience of our employees interacting with IT support, we’re seeing efficiencies there with automation. And we are going to bring a lot more efficiency to our own teams.

And one of the measurements that we have internally is an employee satisfaction measure. I found this to be very interesting. For the infrastructure organization, the IT internal personnel, their engagement score went up 40 points from before we started this transformation. You could see that not only are they getting rescaled or retooled, we make sure we have enough of that expertise in-house, and their engagement scores went up right along with that. It helped us on keeping our employees very motivated and engaged.

Gardner: People like to work with modern technology more than the old stuff, is that not true?

Agarwal: Yes, for sure. I want to work with the iPhone X not iPhone 7.

Gardner: What have you learned that you could impart to others? Now, not many others are going to be doing this reverse separation, modernization, consolidation, application, rationalization process at the same time -- while keeping the companies operating.

But what would you tell other people who are going about application and data center modernization?

Prioritize your partners

Bottome: Pick your partner carefully. Picking the right partner is very, very important, not only the technology partner but any of the other partners along the journey with you, be it application migration or your services partners. Our services partner is DXC. And the majority of the data center is built on HPE gear, along with Arista and Brocade.

Also, make sure that you truly understand all of the other transformations that get impacted by the transformation you’re on. In all honesty, I’ve had some bumps along the way because there was so much transformation going on at once. Make sure those dependencies are fully understood.

Gardner: Piyush, what have you learned that you would impart to others?

Agarwal: It goes back to one of the earlier questions. Understand the business drivers in addition to picking your partners. Know your own level of strength at that point in time.

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If we had done this a year and a half ago, the confidence level and our own capability to do it would have been different. So, picking your partner and having confidence in your own abilities are both very important.

Bottome: Thank you, Dana. It was exciting to talk about something that has been a lot of work but also a lot of satisfaction and an exciting journey.

Gardner: I’m afraid we’ll have to leave it there. You’ve been exploring with us how HP Inc. has taken four shared data centers and is transitioning to two more agile ones, with higher performance and lower cost. And we’ve learned how the multicloud data center of the future approach provides such benefits as a strategic and obsolescence-resistant design, DevOps benefits, and pushes people to do more with less with their applications.

Please join me in thanking our guests, Sharon Bottome, Vice President and Head of Infrastructure Services at HPI. Thank you so much, Sharon.

Bottome: Thank you.

Gardner: And Piyush Agarwal, Senior Director of Infrastructure Services, also at HPI. Thank you, sir.

Agarwal: Thank you for having us.

Gardner: And a big thank you as well to our audience for joining us for this BriefingsDirect Voice of the Customer digital transformation success story discussion. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this ongoing series of Hewlett-Packard Enterprise-sponsored interviews.

Thanks again for listening. Please pass this along to your own IT community and do come back next time.

Listen to the podcast. Find it on iTunes. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Transcript of a discussion on how a massive corporate split led to the re-architecting and modernizing of IT to allow for the right data center choices at the right price over time. Copyright Interarbor Solutions, LLC, 2005-2018. All rights reserved.

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Dark Side of Cloud—How People and Organizations are Unable to Adapt and Improve the Business

Transcript of a discussion on how cloud adoption is not reaching its potential due to outdated behaviors and persistent dissonance between what businesses can do and will do with cloud model strengths.

Listen to the podcast. Find it on iTunes. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Dana Gardner: Hello, and welcome to the next edition of the BriefingsDirect Voice of the Analyst podcast series. I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on the latest insights into hybrid IT and cloud computing.

Gardner

Many of our ongoing discussions focus on infrastructure trends that support the evolving hybrid IT continuum. Today’s focus shifts to behavior -- how individuals and groups, both large and small, benefit from cloud adoption.

It turns out that a dark side to cloud points to a lackluster business outcome trend. A large part of the disappointment has to do with outdated behaviors and persistent dissonance between what line of business (LOB) practitioners can do and will do with their newfound cloud strengths.

We’ll now hear from an observer of worldwide cloud adoption patterns on why making cloud models a meaningful business benefit rests more with adjusting the wetware than any other variable.

Here to help explore why cloud failures and cost overruns are dogging many enterprises is Robert Christiansen, Vice President, Global Delivery, Cloud Professional Services and Innovation at Cloud Technology Partners (CTP), a Hewlett Packard Enterprise (HPE) company.

Welcome, Robert.

Robert Christiansen: Thank you for having me, Dana.

Gardner: What is happening now with the adoption of cloud that makes the issue of how people react such a pressing concern? What’s bringing this to a head now?

Fits and starts 

Christiansen

Christiansen: Enterprises are on a cloud journey. They have begun their investment, they recognize that agility is a mandate for them, and they want to get those teams rolling. They have already done that to some degree and extent. They may be moving a few applications, or they may be doing wholesale shutdowns of data centers. They are in lots of different phases in adoption situations.

What we are seeing is a lack of progress with regard to the speed and momentum of the adoption of applications into public clouds. It’s going a little slower than they’d like.

Gardner: We have been through many evolutions, generations, and even step-changes in technology. Most of them have been in a progressive direction. Why are we catching our heels now?

Christiansen: Cloud is a completely different modality, Dana. One of the things that we have learned here is that adoption of infrastructure that can be built from the ground-up using software is a whole other way of thinking that has never really been the core bread-and-butter of an infrastructure or a central IT team. So, the thinking and the process -- the ability to change things on the fly from an infrastructure point of view -- is just a brand new way of doing things.

And we have had various fits and starts around technology adoption throughout history, but nothing at this level. The tool kits available today have completely changed and redefined how we go about doing this stuff.

Gardner: We are not just changing a deployment pattern, we are reinventing the concept of an application. Instead of monolithic applications and systems of record that people get trained on and line up around, we are decomposing processes into services that require working across organizational boundaries. The users can also access data and insights in ways they never had before. So that really is something quite different. Even the concept of an application is up for grabs.

Christiansen: Well, think about this. Historically, an application team or a business unit, let’s say in a bank, said, “Hey, I see an opportunity to reinvent how we do funding for auto loans.”

We worked with a company that did this. And historically, they would have had to jump through a bunch of hoops. They would justify the investment of buying new infrastructure, set up the various components necessary, maybe landing new hardware in the organization, and going into the procurement process for all of that. Typically, in the financial world, it takes months to make that happen.

Today, that same team using a very small investment can stand up a highly available redundant data center in less than a day on a public cloud. In less than a day, using a software-defined framework. And now they can go iterate and test and have very low risk to see if the marketplace is willing to accept the kind of solution they want to offer.

And that just blows apart the procedural-based thinking that we have had up to this point; it just blows it apart. And that thinking, that way of looking at stuff is foreign to most central IT people. Because of that emotion, going to the cloud has come in fits and starts. Some people are doing it really well, but a majority of them are struggling because of the people issue.

Gardner: It seems ironic, Robert, because typically when you run into too much of a good thing, you slap on governance and put in central command and control, and you throttle it back. But that approach subverts the benefits, too.

How do you find a happy medium? Or is there such a thing as a happy medium when it comes to moderating and governing cloud adoption?

Control issues

Christiansen: That’s where the real rub is, Dana. Let’s give it an analogy. At Cloud Technology Partners (CTP), we do cloud adoption workshops where we bring in all the various teams and try to knock down the silos. They get into these conversations to address exactly what you just said. “How do we put governance in place without getting in the way of innovation?”

It’s a huge, huge problem, because the central IT team’s whole job is to protect the brand of the company and keep the client data safe. They provide the infrastructure necessary for the teams to go out and do what they need to do.

When you have a structure like that but supplied by the public clouds like Amazon (AWS), Google, and Microsoft Azure, you still have the ability to put in a lot of those controls in the software. Before it was done either manually or at least semi-manually.

The central IT team's whole job is to protect the brand of the company and keep the client data safe. They provide the infrastructure necessary for the teams to go out and do what they need to do.

The challenge is that the central IT teams are not necessarily set up with the skills to make that happen. They are not by nature software development people. They are hardware people. They are rack and stack people. They are people who understand how to stitch this stuff together -- and they may use some automation. But as a whole it’s never been their core competency. So therein lies the rub: How do you convert these teams over to think in that new way?

At the same time, you have the pressing issue of, “Am I going to automate myself right out of a job?” That’s the other part, right? That’s the big, 800-pound gorilla sitting in the corner that no one wants to talk about. How do you deal with that?

Gardner: Are we talking about private cloud, public cloud, hybrid cloud, hybrid IT -- all the above when it comes to these trends?

Public perceptions

Christiansen: It’s mostly public cloud that you see the perceived threats. The public cloud is perceived as a threat to the current way of doing IT today, if you are an internal IT person.

Let’s say that you are a classic compute and management person. You actually split across both storage and compute, and you are able to manage and handle a lot of those infrastructure servers and storage solutions for your organization. You may be part of a team of 50 in a data center or for a couple of data centers. Many of those classic roles literally go away with a public cloud implementation. You just don’t need them. So these folks need to pivot or change into new roles or reinvent themselves.

Let’s say you’re the director of that group and you happen to be five years away from retirement. This actually happened to me, by the way. There is no way these folks want to give up the range right before their retirement. They don’t want to reinvent their roles just before they’re going to go into their last years.

They literally said to me, “I am not changing my career this far into it for the sake of a public cloud reinvention.” They are hunkering down, building up the walls, and slowing the process. This seems to be an undercurrent in a number of areas where people just don’t want to change. They don’t want any differences.

Gardner: Just to play the devil’s advocate, when you hear things around serverless, when we see more operations automation, when we see artificial intelligence (AI)Ops use AI and machine learning (ML) -- it does get sort of scary.

You’re handing over big decisions within an IT environment on whether to use public or private, some combination, or multicloud in some combination. These capabilities are coming into fruition.

Maybe we do need to step back and ask, “Just because you can do something, should you?” Isn’t that more than just protecting my career? Isn’t there a need for careful consideration before we leap into some of these major new trends?

Transform fear into function 

Christiansen: Of course, yeah. It’s a hybrid world. There are applications where it may not make sense to be in the public cloud. There are legacy applications. There are what I call centers of gravity that are database-centric; the business runs on them. Moving them and doing a big lift over to a public cloud platform may not make financial sense. There is no real benefit to it to make that happen. We are going to be living between an on-premises and a public cloud environment for quite some time.

The challenge is that people want to create a holistic view of all of that. How do I govern it in one view and under one strategy? And that requires a lot of what you are talking about, being more cautious going forward.

And that’s a big part of what we have done at CTP. We help people establish that governance framework, of how to put automation in place to pull these two worlds together, and to make it more seamless. How do you network between the two environments? How do you create low-latency communications between your sources of data and your sources of truth? Making that happen is what we have been doing for the last five or six years.

We help establish that governance framework, of how to put automation in place to pull these two worlds together, and to make it more seamless.

The challenge we have, Dana, is that once we have established that -- we call that methodology the Minimum Viable Cloud (MVC). And after you put all of that structure, rigor, and security in place -- we still run into the problems of motion and momentum. Those needed governance frameworks are well-established.

Gardner: Before we dig into why the cloud adoption inertia still exists, let’s hear more about CTP. You were acquired by HPE not that long ago. Tell us about your role and how that fits into HPE.

CTP: A cloud pioneer

Christiansen: CTP was established in 2010. Originally, we were doing mostly private cloud, OpenStack stuff, and we did that for about two to three years, up to 2013.

I am one of the first 20 employees. It’s a Boston-based company, and I came over with the intent to bring more public cloud into the practice. We were seeing a lot of uptick at the time. I had just come out of another company called Cloud Nation that I owned. I sold that company; it was an Amazon-based, Citrix-for-rent company. So imagine, if you would, you swipe a credit card and you get NetScaler, XenApp and XenDesktop running on top of AWS way back in 2012 and 2013.

I sold that company, and I joined CTP. We grew the practice of public cloud on Google, Azure, and AWS over those years and we became the leading cloud-enabled professional services organization in the world.

We were purchased by HPE in October 2017, and my role since that time is to educate, evangelize, and press deeply into the methodologies for adopting public cloud in a holistic way so it works well with what people have on-premises. That includes the technologies, economics, strategies, organizational change, people, security, and establishing a DevOps practice in the organization. These are all within our world.

We do consultancy and professional services advisory types of things, but on the same coin, we flip it over, and we have a very large group of engineers and architects who are excellent on keyboards. These are the people who actually write software code to help make a lot of this stuff automated to move people to the public clouds. That’s what we are doing to this day.

Gardner: We recognize that cloud adoption is a step-change, not an iteration in the evolution of computing. This is not going from client/server to web apps and then to N-Tier architectures. We are bringing services and processes into a company in a whole new way and refactoring that company. If you don’t, the competition or a new upstart unicorn company is going to eat your lunch. We certainly have seen plenty of examples of that.

So what prevents organizations from both seeing and realizing the cloud potential? Is this a matter of skills? Is it because everyone is on the cusp of retirement and politically holding back? What can we identify as the obstacles to overcome to break that inertia?

A whole new ball game

Christiansen: From my perspective, we are right in the thick of it. CTP has been involved with many Fortune 500 companies through this process.

The technology is ubiquitous, meaning that everybody in the marketplace now can own pretty much the same technology. Dana, this is a really interesting thought. If a team of 10 Stanford graduates can start up a company to disrupt the rental car industry, which somebody has done, by the way, and they have access to technologies that were only once reserved for those with hundreds of millions of dollars in IT budgets, you have all sorts of other issues to deal with, right?

So what’s your competitive advantage? It’s not access to the technologies. The true competitive advantage now for any company is the people and how they consume and use the technology to solve a problem. Before [the IT advantage] was reserved for those who had access to the technology. That’s gone away. We now have a level playing field. Anybody with a credit card can spin up a big data solution today – anybody. And that’s amazing, that’s truly amazing.

For an organization that had always fallen back on their big iron or infrastructure -- those processes they had as their competitive advantage -- that now has become a detriment. That’s now the thing that’s slowing them down. It’s the anchor holding them back, and the processes around it. That rigidity of people and process locks them into doing the same thing over and over again. It is a serious obstacle.

Untangle spaghetti systems 

Another major issue came very much as a surprise, Dana. We observed it over the last couple of years of doing application inventory assessments for people considering shutting down data centers. They were looking at their applications, the ones holding the assets of data centers, as not competitive. And they asked, “Hey, can we shut down a data center and move a lot of it to the public cloud?”

We at CTP were hired to do what are called application assessments, economic evaluations. We determine if there is a cost validation for doing a lift-and-shift [to the public cloud]. And the number-one obstacle was inventory. The configuration management data bases (CMDBs), which hold the inventory of where all the servers are and what’s running on them for these organizations, were wholly out of date. Many of the CMDBs just didn’t give us an accurate view of it all.

When it came time to understand what applications were actually running inside the four walls of the data centers -- nobody really knew. As a matter of fact, nobody really knew what applications were talking to what applications, or how much data was being moved back and forth. They were so complex; we would be talking about hundreds, if not thousands, of applications intertwined with themselves, sharing data back and forth. And nobody inside organizations understood which applications were connected to which, how many there were, which ones were important, and how they worked.

When it came time to understand what applications were actually running inside of the four walls of the data centers -- no one really knew. Nobody knew what applications were talking to what applications, or how much data was being moved back and forth.

Years of managing that world has created such a spaghetti mess behind those walls that it’s been exceptionally difficult for organizations to get their hands around what can be moved and what can’t. There is great integration within the systems.

The third part of this trifecta of obstacles to moving to the cloud is, as we mentioned, people not wanting to change their behaviors. They are locked in to the day-to-day motion of maintaining those systems and are not really motivated to go beyond that.

Gardner: I can see why they would find lots of reasons to push off to another day, rather than get into solving that spaghetti maze of existing data centers. That’s hard work, it’s very difficult to synthesize that all into new apps and services.

Christiansen: It was hard enough just virtualizing these systems, never mind trying to pull it all apart.

Gardner: Virtualizing didn’t solve the larger problem, it just paved the cow paths, gained some efficiency, reduced poor server utilization -- but you still have that spaghetti, you still have those processes that can’t be lifted out. And if you can’t do that, then you are stuck.

Christiansen: Exactly right.

Gardner: Companies for many years have faced other issues of entrenchment and incumbency, which can have many downsides. Many of them have said, “Okay, we are going to create a Skunk Works, a new division within the company, and create a seed organization to reinvent ourselves.” And maybe they begin subsuming other elements of the older company along the way.

Is that what the cloud and public cloud utilization within IT is doing? Why wouldn’t that proof of concept (POC) and Skunk Works approach eventually overcome the digital transformation inertia?

Clandestine cloud strategists

Christiansen: That’s a great question, and I immediately thought of a client who we helped. They have a separate team that re-wrote or rebuilt an application using serverless on Amazon. It’s now a fairly significant revenue generator for them, and they did it almost two and-a-half years ago.

It uses a few cloud servers, but mostly they rely on the messaging backbones and non-server-based platform-as-a-service (PaaS) layers of AWS to solve their problem. They are a consumer credit company and have a lot of customer-facing applications that they generate revenue from on this new platform.

The team behind the solution educated themselves. They were forward-thinkers and saw the changes in public cloud. They received permission from the business unit to break away from the central IT team’s standard processes, and they completely redefined the whole thing.

The team really knocked it out of the park. So, high success. They were able to hold it up and tried to extend that success back into the broader IT group. The IT group, on the other hand, felt that they wanted more of a multicloud strategy. They weren’t going to have all their eggs in Amazon. They wanted to give the business units options, of either going to Amazon, Azure, or Google. They wanted to still have a uniform plane of compute for on-premises deployments. So they brought in Red Hat’s OpenShift, and they overlaid that, and built out a [hybrid cloud] platform.

Now, the Red Hat platform, I personally had had no direct experience, but I had heard good things about it. I had heard of people who adopted it and saw benefits. This particular environment though, Dana, the business units themselves rejected it.

The core Amazon team said, “We are not doing that because we’re skilled in Amazon. We understand it, we’re using AWS CloudFormation. We are going to write code to the applications, we are going to use Lambda whenever we can.” They said, “No, we are not doing that [hybrid and multicloud platform approach].”

Other groups then said, “Hey, we’re an Azure shop, and we’re not going to be tied up around Amazon because we don’t like the Amazon brand.” And all that political stuff arose, they just use Azure, and decided to go shooting off on their own and did not use the OpenShift platform because, at the time, the tool stacks were not quite what they needed to solve their problems.

The company ended up getting a fractured view. We recommended that they go on an education path, to bring the people up to speed on what OpenShift could do for them. Unfortunately, they opted not to do that -- and they are still wrestling with this problem.

CTP and I personally believe that this was an issue of education, not technology, and not opportunity. They needed to lean in, sponsor, and train their business units. They needed to teach the app builders and the app owners on why this was good, the advantages of doing it, but they never invested the time. They built it and hoped that the users would come. And now they are dealing with the challenges of the blowback from that.

Gardner: What you’re describing, Robert, sounds an awful lot like basic human nature, particularly with people in different or large groups. So, politics, right? The conundrum is that when you have a small group of people, you can often get them on board. But there is a certain cut-off point where the groups are too large, and you lose control, you lose synergy, and there is no common philosophy. It’s Balkanization; it’s Europe in 1916.

Christiansen: Yeah, that is exactly it.

Gardner: Very difficult hurdles. These are problems that humankind has been dealing with for tens of thousands of years, if not longer. So, tribalism, politics. How does a fleet organization learn from what software development has come up with to combat some of these political issues? I’m thinking of Agile methodologies, scrums, and having short bursts, lots of communication, and horizontal rather than command-and-control structures. Those sorts of things.

Find common ground first

Christiansen: Well, you nailed it. How you get this done is the question. How do you get some kind of agility throughout the organization to make this happen? And there are successes out there, whole organizations, 4,000 or 5,000 or 6,000 people, have been able to move. And we’ve been involved with them. The best practices that we see today, Dana, are around allowing the businesses themselves to select the platforms to go deep on, to get good at.

Let’s say you have a business unit generating $300 million a year with some service. They have money, they are paying the IT bill. But they want more control, they want more the “dev” from the DevOps process.

The best practices that we see today are around allowing the businesses themselves to select the cloud platforms to go deep on, to get good at. ... They want the "dev" from the DevOps process.

They are going to provide much of that on their own, but they still need core common services from central IT team. This is the most important part. They need the core services, such as identity and access management, key management, logging and monitoring, and they need networking. There is a set of core functions that the central team must provide.

And we help those central teams to find and govern those services. Then, the business units [have cloud model choice and freedom as long as they] consume those core services -- the access and identity process, the key management services, they encrypt what they are supposed to, and they use the networking functions. They set up separation of the services appropriately, based on standards. And they use automation to keep them safe. Automation prevents them from doing silly things, like leaving unencrypted AWS S3 buckets open to the public Internet, things like that.

You now have software that does all of that automation. You can turn those tools on and then it’s like a playground, a protected playground. You say, “Hey, you can come out into this playground and do whatever you want, whether it’s on Azure or Google, or on Amazon or on-premises.”

 “Here are the services, and if you adopt them in this way, then you, as the team, can go deep, you can use Application programming interface (API) calls, you can use CloudFoundation or Python or whatever happens to be the scripting language you want to build your infrastructure with.”

Then you have the ability to let those teams do what they want. If you notice, what it doesn’t do is overlay a common PaaS layer, which isolates the hyperscale public cloud provider from your work. That’s a whole other food fight, religious battle, Dana, around lock-in and that kind of conversation.

Gardner: Imposing your will on everyone else doesn’t seem to go over very well.

So what you’re describing, Robert, is a right-sizing for agility, and fostering a separate-but-equal approach. As long as you can abstract to the services level, and as long as you conform to a certain level of compliance for security and governance -- let’s see who can do it better. And let the best approach to cloud computing win, as long as your processes end up in the right governance mix.

Development power surges

Christiansen: People have preferences, right? Come on! There’s been a Linux and .NET battle since I have been in business. We all have preferences, right? So, how you go about coding your applications is really about what you like and what you don’t like. Developers are quirky people. I was a C programmer for 14 years, I get it.

The last thing you want to do is completely blow up your routines by taking development back and starting over with a whole bunch of new languages and tools. Then they’re trying to figure out how to release code, test code, and build up a continuous integration/continuous delivery pipeline that is familiar and fast.

These are really powerful personal stories that have to be addressed. You have to understand that. You have to understand that the development community now has the power -- they have the power, not the central IT teams. That shift has occurred. That power shift is monumental across the ecosystem. You have to pay attention to that.

If the people don’t feel like they have a choice, they will go around you, which is where the problems are happening.

Gardner: I think the power has always been there with the developers inside of their organizations. But now it’s blown out of the development organization and has seeped up right into the line of business units.

Christiansen: Oh, that’s a good point.

Gardner: Your business strategy needs to consider all the software development issues, and not just leave them under the covers. We’re probably saying the same thing. I just see the power of development choice expanding, but I think it’s always been there.

But that leads to the question, Robert, of what kind of leadership person can be mindful of a development culture in an organization, and also understand the line of business concerns. They must appreciate the C-suite strategies. If you are a public company, keeping Wall Street happy, and keeping the customer expectations met because those are always going up nowadays.

It seems to me we are asking an awful lot of a person or small team that sits at the middle of all of this. It seems to me that there’s an organizational and a talent management deficit, or at least something that’s unprecedented.

Tech-business cross-pollination

Christiansen: It is. It really is. And this brings us to a key piece to our conversation. And that is the talent enablement. It is now well beyond how we’ve classically looked at it.

Some really good friends of mine run learning and development organizations and they have consulting companies that do talent and organizational change, et cetera. And they are literally baffled right now at the dramatic shift in what it takes to get teams to work together.

In the more flexible-thinking communities of up-and-coming business, a lot of the folks that start businesses today are technology people. They may end up in the coffee industry or in the restaurant industry, but these folks know technology. They are not unaware of what they need to do to use technology.

So, business knowledge and technology knowledge are mixing together. They are good when they get swirled together. You can’t live with one and not have the other.

For example, a developer needs to understand the implications of economics when they write something for cloud deployment. If they build an application that does not economically work inside the constructs of the new world, that’s a bad business decision, but it’s in the hands of the developer.

It’s an interesting thing. We’ve had that need for developer-empowerment before, but then you had a whole other IT group put restrictions on them, right? They’d say, “Hey, there’s only so much hardware you get. That’s it. Make it work.” That’s not the case anymore, right?

We have created a whole new training track category called Talent Enablement that CTP and HPE have put together around the actual consumers of cloud.

At the same time, you now have an operations person involved with figuring out how to architect for the cloud, and they may think that the developers do not understand what has to come together.

As a result, we have created a whole new training track category called Talent Enablement that CTP and HPE have put together around the actual consumers of cloud.

We have found that much of an organization’s delay in rolling this out is because the people who are consuming the cloud are not ready or knowledgeable enough on how to maximize their investment in cloud. This is not for the people building up those core services that I talked about, but for the consumers of the services, the business units.

We are rolling that out later this year, a full Talent Enablement track around those new roles.

Gardner: This targets the people in that line of business, decision-making, planning, and execution role. It brings them up to speed on what cloud really means, how to consume it. They can then be in a position of bringing teams together in ways that hadn’t been possible before. Is that what you are getting at?

Teamwork wins 

Christiansen: That’s exactly right. Let me give you an example. We did this for a telecommunications company about a year ago. They recognized that they were not going to be able to roll out their common core services.

The central team had built out about 12 common core services, and they knew almost immediately that the rest of the organization, the 11 other lines of business, were not ready to consume them.

They had been asking for it, but they weren’t ready to actually drive this new Ferrari that they had asked for. There were more than 5,000 people who needed to be up-skilled on how to consume the services that a team of about 100 people had put together.

Now, these are not classic technical services like AWS architecture, security frameworks, or Access control list (ACL) and Network ACL (NACL) for networking traffic, or how you connect back and backhaul, that kind of stuff. None of that.

I’m talking about how to make sure you don’t get a cloud bill that’s out of whack. How do I make sure that my team is actually developing in the right way, in a safe way? How do I make sure my team understands the services we want them to consume so that we can support it?

It was probably 10 or 12 basic use domains. The teams simply didn’t understand how to consume the services. So we helped this organization build a training program to bring up the skills of these 4,000 to 5,000 people.

Now think about that. That has to happen in every global Fortune 2000 company where you may only have a central team of a 100, and maybe 50 cloud people. But they may need to turn over the services to 1,000 people.

We have a massive, massive, training, up-skilling, and enablement process that has to happen over the next several years.

Gardner: I’m afraid we’ll have to leave it there. We’ve been exploring how a large part of the disappointment with cloud-based business outcomes has to do with outdated behaviors and even persistent dissonance between what line of business practitioners can do and what they should do with their new cloud strength.

And we’ve learned why making cloud models meaningful businesses rests more with the people, change management, and talent management than just about anything else.

Please join me in thanking our guest, Robert Christiansen, Vice President, Global Delivery of Cloud Professional Services and Innovation at Cloud Technology Partners, an HPE company.

Robert, thank you so much. I really enjoyed it.

Christiansen: Thanks, Dana. I did too. I hope to come back again.

Gardner: And thanks also to our audience for joining this BriefingsDirect Voice of the Analyst hybrid IT and cloud computing strategies interview.

I’m Dana Gardner, Principal Analyst at Interarbor Solutions, your host for this ongoing series of Hewlett Packard Enterprise-sponsored discussions. Thanks again for listening.  Please pass this along to your IT community and do come back next time.

Listen to the podcast. Find it on iTunes. Download the transcript. Sponsor: Hewlett Packard Enterprise.

Transcript of a discussion on how cloud adoption is not reaching its potential due to outdated behaviors and persistent dissonance between what businesses can do and will do with cloud model strengths. Copyright Interarbor Solutions, LLC, 2005-2018. All rights reserved.

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