Second Keynote – VMware Partner Exchange

Eschenbach speaking today for 2nd keynote of Partner Exchange 2012. These notes are more what stands out to me today.

Asking Partners to consider where to invest your development dollars — believe that the best option is VMware.

VMware’s growth outpaced the industry by 8-10%. Part of this is Net Promoter Score — VMware’s is 68 which is really close to Apple’s at 70 (highest in the industry).

More after the jump…

VMware is pushing heavily into automation but not ESM (Enterprise Systems Management) — building management and automation tools that bring cloud and cloud-scale services to life.

The last thing we need to do to extend cloud’s reach is to push End User Computing closer to the customer — remove the barrier that couples people to a device while still keeping what level of IT control is necessary. This is really all about Project Horizon — about just giving access to the applications. I do find this messaging very interesting given View is VMware’s flagship EUC product today.

But there’s a big services aspect to this as well — classic stuff (P2V, setup vSphere, etc.) is relatively small compared to services that have operational impact — i.e. what you get as move towards cloud computing (and if you’re the partner to move your customers there). Just like Paul talked yesterday about CIO’s who want infrastructure off their plate, Eschenbach echoes that — Managed Services from partners is a huge opportunity to provide that.

9:35 – Brand new Go To Market strategy based on market segmentation – Enterprise, Commercial, & SMB. Some very big goals around the enterprise segment b/c customers are making major decisions about infrastructure and cloud platform. This will drive the next decade of purchasing decisions — we have to get in now.

SMB as well — many customers pushing towards virtualization. Even without much marketing, 7 out of 10 SMB customers say they are using VMware or plan to use VMware. Specific GRID campaign for SMB and also webinars focused there.

Always nice to see actual segment definitions — SMB is up to 1k employees, Commercial is 1k to 5k, Enterprise is 5k and up.

For the Enterprise sector, the model is “VMware Led, Partner Supported”. For Commercial, it’s “VMware and Partner Led”. For SMB, it’s “Partner Led, VMware Supported”. Hmm….I’ll be curious to see ho much difference there is here. My experience has been “Partner Led, Partner Supported” all the time for SMB and most of the time for Commercial.

VMware wants to be very clear that they’re not trying to compete with partners on services — showing service dollar breakdown.

2007 – 2011 is leader in CAGR — 30% Yearly growth. Oracle even with a TON of acquisitions only hit 18% growth.

9:55 – 95% of customers believe that VMware will be central to their cloud strategy. No one else is even close. $3.77 B this year, guiding towards $4.77 B next year. Eschenbach now introduces Bill Taylor with Fast Company.

Today your company must be the “most” of something. Being middle of the road is a road to nowhere.

Case study around airlines business — worst business to be in period. In last 10 years airlines have lost $55 billion. Buffett famously said he would have shot Orville Wright out of the sky due to all the pain the airline industry has caused investors. Southwest is the remarkable standout here.

You ask any Southwest employee (35,000) what their business is and they say it’s not about airline, not about money, it’s about freedom — democratizing airline travel and making it accessible. All they do goes towards this — open seating, one type of airplane, etc. etc.

“The only sustainable form of business leadership is thought leadership.”

Now discussing USAA — not just the technology leadership but also how the military culture is ingrained into employees during new hire training — have to carry 65 lb. packs during the day, eat MRE’s for lunch, read letters from military at night, etc. There’s a real goal to get USAA employees to understand their customers — this isn’t just empathy but also to technology. First company to allow you to deposit a check via iPhone, first to let you send money via secure text message, etc. They’re obsessed with their customers and how hard their customers’ lives are….so doing anything they can (which includes technology) to make that easier.

“The real magic is when you make your services and products memorable to your customer.”

“Companies of the future will be intensely human.” What’s ironic is that technology can enable this…but also undermine it. It’s about what you’re doing that is rare and unique…and then leveraging that out to your customers. If you can’t answer what you do that’s rare and unique, you’ve got trouble.

Next Case Study – Umqua Bank. What does a bank look like? Umqua looks like an art gallery — get local art/sculpture to put in branches. What does a bank sound like? Umqua has a record label — contacts local artists and play their music in the bank — no music. They then put out a greatest hits CD each year. What does a bank smell like? Most banks smell like fear…Umqua has a cappuccino machine by each teller and teller will make you one. What does a bank taste like? Every transaction ends with a box of Godiva chocolates.

People had never run into this before…massively popular. But they went further….why close the building when we’re done banking? They hired a Community Manager — after bank closes at 5 PM, it re-opens for community groups, chambers of commerce, knitting clubs, etc.

They’re also using on-demand video conferencing at branches — have domain specific experts. But the real difference is that they use the same cameras/big screens to host Wii Bowling leagues at night — get people with company uniforms competing, etc. etc.

Umqua isn’t if you just want lowest rate, basis points, etc. — they’re about making your life a bit more enjoyable each day. What is that worth to you as a customer?

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