Following the recent formation of Hitachi Vantara, the company is banking upon its existing sets of customers to further develop its customer base. In an interaction with CRN, Raghuram Krishnan, Director – Partner and Alliances, Hitachi Vantara, shares how the company is planning to build its IoT and data analytics solutions
What was the rationale behind the formation of Hitachi Vantara?
Hitachi Vantara was formed in September 2017. Businesses which evolve on the internet and which use technology extensively, are disrupting the existing players. All the CEOs are now understanding that if they don’t change, they will be completely eliminated from the market. What’s driving this is essentially the user behaviour, which is based on digital transformation. What comes in the center of digital transformation is data. Hitachi Vantara is the amalgamation of Hitachi Data Systems, Pentaho and Hitachi Insights – data is central to the solutions of all of these. Hitachi Data Systems, on its own, was a pioneer in infrastructure, be it computing data, storing data, governing data or mobilizing data. Pentaho took it one step ahead; the data data needs to be analyzed to get insights out of it and Pentaho does that. Whereas, Internet of Things (IoT) gets data from machine learnings to provide more insights to businesses. Instead of three companies working in silos, Hitachi Vantara became a natural progression.
When it comes to educating customers on the offerings of Hitachi Vantara, the role of the partner ecosystem is crucial. How have you put efforts on the partner ecosystem, thereby resulting in customer requirements?
Pentaho is not a newly formed company; it was already present and it had its own set of partners, so did Hitachi Data Systems. In our new program, we ended up merging them. In today’s world, it’s not about competition or cooperation; it’s a mix of both, because there will be areas where we’ll have to align with our competitors too. This holds true not just for the OEMs, but for partners as well. The landscape of partners India, who do meaningful business in the marketplace relevant to our business line, includes the GSIs, MSIs, value added resellers, and cloud service providers; each bringing its own uniqueness. They are also realizing that if they don’t embark on this journey, they will be extinct in the market, because the way customers buy has changed. Customers don’t buy products anymore. About 60-70 per cent of the IT budget is spent on keeping the lights on.
The existing infrastructure needs to be maintained and upgraded, because the number users is increasing. However, CEOs want to utilize this money to embark on digital transformation – optimizing processes, building more revenue with customer experience and entering new markets. This is where the partners play a role to bridge the gap between the CEO’s expectations and what the CIO is able to deliver. There’s so much money spent on keeping the lights on, that CIOs are not able to focus on things that are critical for the organization; this is where the partners come into the play, with their solutions, our solutions and both embedded together to create a value proposition for the customers. These are the kind of partners who will be able to help us.
As Pentaho, Hitachi Data Systems and Hitachi Insights has their own set of partners; how has been the synergy between these partners?
This is an ongoing process which takes time. Partners who realize that they have to move up their value chain in front of the customers, will start investing in these technologies. Till the time they invest in them, they need to leverage the exist strengths of the Pentaho partners, learn from them and build skill levels within their own organizations. Similarly, the Pentaho partners who talk about data analytics, are leaving the infrastructure piece free for someone else to address.
The GSIs and MSIs are adapting to this whole situation rapidly. They are going on a rampage in terms of skill building around data analytics, IoT the existing infrastructure they have. System integration has gone into a new dimension altogether; it’s not about putting together third party elements and creating a solution. Today the solution is about understanding the business challenges of customers and finding out the right technologies which will be needed to address the outcome of the business. Other partners will also follow, because they realize that the last-man-standing strategy may not work for everybody. So those who really want to move up the value chain and build their profitability will be the ones to embark on this journey at a rapid pace.
Post the formation of Hitachi Vantara, did you have to restructure the channel ecosystem or revamp the channel programs?
The channel programs are still evolving; and we know where to invest money, keeping in mind customers and partners who want to move up the value chain. Whereas from a channel strategy perspective, we are clear about the markets we want to address, and out positions in each year. So it’s we are clear on how to address the markets, the skill levels and trainings needed – the complete capacity and capabilities matrix has been drawn for the partners which is being done effectively. Alongside GSIs and MSIs, large VARs are also asking us about what they can do to move up the value chain. Today all the large VARs end up doing what they do the best in terms of providing a product solution to the market, and they that in the future, it has to be technology solutions.
We have a programmed training schedule for our partners – this is the derivative of the capacity and capability matrix we have drawn. That training for a particular set of partners will be different from that of other sets of partners. One set of partners would specialize in identifying data analytics projects, whereas another set of partners would not specialize in the same, so we have defined the training clearly for each set of partners. We have a team of pre-sales persons which does this on an effectively. However, there are various other functions within the partner organization that need to be trained, alongside pre-sales – such as the delivery and practice teams.
How are to ensuring win-win situation in the channel ecosystem, and what expectations do you have from partners?
In today’s world, selling boxes isn’t the way anymore. You start making money when you take products which are new solutions in the market – the moment these become commodities, you start losing money there as well. The myth of profitability in this industry is related to backend rebates. Profitability is never directly proportional to backend rebates, but to the value that you give to customers. To ensure value for customers, one has to address what’s closest to them – not just in terms of business outcomes, but also in IT infrastructure. The reason why GSIs and MSIs are making better profits because they have moved up a notch. When you move up the value chain, annuity business increases which is a critical factor in partner organizations.
The ethos of our channel strategy in India is to create self-sustaining, profitable and value selling partner organizations; and we firmly believe that technology is best when its spread across the gamut of customers. Hence it becomes necessary to pick the right partners for the right set of customers, because we can’t be present everywhere. The only way we get our customers harness the potential of technology, is by getting the partners to take the technology to the market; for that, the skill level needs of partners need to grow, and they need to be able to identify, address and close opportunities.