In this episode, Chris Rechtsteiner (VP of Marketing at ServerCentral Turing Group) provides vital insight into the future of hybrid cloud, and how organizations are leveraging these environments to optimize cost efficiency and performance.
INTRO: [00.00] Welcome to the Tech in 20 Minutes podcast, where you’ll meet new tech vendors, and learn how they can help your business. At ITBroker.com, we believe tech should make your life better, searching Google is a waste of time, and the right vendor is often one you haven’t heard of before.
Max: [00.18] Hi I’m Max Clark and I’m talking with Chris Rechtsteiner who is the VP of Marketing at ServerCentral Turing Group. Chris, thanks for joining.
Chris: [00.24] Thank you Max, I appreciate you having me on here, it’s always a blast to do these conversations, so I’m looking forward to it.
Max: [00.31] So Chris, I would say, normally I would say like, what does ServerCentral do, but now that’s changed a little bit with the combination of ServerCentral and Turing Group, so… Correctly asked, what does ServerCentral and Turing Group do, and what is the problem that you’re solving for your customers?
Chris: [00.44] Sure, so – you’re correct, ServerCentral Turing Group is relatively new, so the core of that ServerCentral was founded in 2000, and two years ago we merged with Turing Group, which was a professional services-focused organization. So, we took the datacenter and managed services side and then the professional services side of Turing Group, and brought those together into one organization. And what we do today and what we’re really focused on, is how do we help organizations solve challenges with technology, and that’s a really big statement but what it comes down to is everyone has something that they want to do, they want to achieve, and they want to realize a result from that investment. And what we try to do, is take that step back and listen, learn and really work with them and truly collaborate to find out exactly what the right solution is that’s going to help drive their business forward, and that’s a big statement, but if it doesn’t align with where they want to go, it doesn’t really matter what you do. And we try very hard to stay focused on what are those desired outcomes and keeping everything aligned.
Max: [01.46] ServerCentral started as — in the datacenter space, in what was dedicated servers at that time, and now these terms have mutated a little bit, and so now instead of saying dedicated servers, we talk about bare metal, and instead of saying bare metal to some degree we talk about hybrid cloud. So, how different from bare — dedicated servers is this, really? What is hybrid cloud and how does that relate to bare metal?
Chris: [02.10] Wow, that’s a great question and it’s a big question too. So, there really isn’t a lot of difference between the concept of bare metal and private cloud, and dedicated servers, and the only difference in the private cloud universe is the virtualization layer will be provided. Typically what happens when you work with any organization, is you have to understand what they mean when they use those terms. So, we do a lot of work up front, and I know certainly we’ve been told this, it gets annoying for some people who say, “Well what do you mean when you say that?” When you say bare metal, what are you referring to? When you have a private cloud, what are you referring to? How do you define that, how does your organization define that? And what it enables us to do is look at the fact that when they say ‘bare metal’, they want full control. They can’t control all the way down to the machine itself. When they talk about a private cloud, they really want control all the way to the virtualization layer; they don’t want to worry about the hardware, they don’t want to be responsible for drives or anything of that nature, they really want to pick it up at the virtualization layer. When they move it into the hybrid cloud side, it really becomes a function of how they’re going to connect that to other capabilities, other applications, other platforms in their business. And what we’re seeing today that adds more complexity to this is not just understanding what someone means when they say bare metal or private cloud, but when they then talk about hybrid, what do they mean? What are they connecting to? For many organizations, that hybrid cloud becomes a connection to Salesforce.com, or NetSweep, or something of that nature, where that’s in the cloud and then they have their own applications running in the datacenter, and that’s now hybrid, but what level of connectivity and how that comes together are really big, open questions that a lot of organizations haven’t thought of. So, as this becomes more commonplace, what we’re seeing is understanding the definition in the customer’s eyes, in their minds, is really the most critical point, because at the end of the day if they’re not aligned with what they want to achieve – and believe me, lack of alignment as you know happens a lot – things get sideways really quickly. So, we want to make sure we really just keep everybody on the right path, and that no matter how that definition may change, whatever degree it’s twisted to the side, there’s an answer, and it does stay aligned and we do achieve what they’re looking to get to.
Max: [04.24] As a marketing person, I can beat you up a little on this one, because we see marketing you know, so multi-cloud, hybrid cloud, private cloud, there’s all these terms that get thrown around at people that get mutated and mean different things in different situations, and are stretched out, do they actually mean what they’re supposed to mean anymore? So, you know, taking out what now the industry is branding around hybrid cloud or multi-cloud, for a line of business leaders, how would they even know that this is something that they should be thinking about? I don’t think a lot of people wake up in the morning and go, “Oh, I know I need a hybrid cloud solution today,” you know? What’s actually driving this push into bare metal as a reinvention of dedicated servers and hybrid cloud as an augmentation of public clouds?
Chris: [05.10] What’s really driving the bigger decisions, really the biggest decisions we see are two, or I should say, are two factors. The first is cost – where people are realizing that they have a lot invested in many different areas, and they’re not quite sure how they connect. The second piece is really capability, and when I say capability, what I mean there is what do you need access to? What do you need to use and what do you want to use within your business? When we think about how all of this comes together, at a business level, it’s very easy to find out what those requirements are. Now, a technical discussion is slightly different, but at the business level it’s actually very easy, because someone will say, “Well, we’re not in the cloud,” and you say, “Well okay, go and pull expense reports from the last three months and look for things like Amazon, DropBox, box.com, Google, Azure, whatever,” that list is endless, as you know? Look for those, and see how many people have those line items on their expense reports, because there’s your cloud strategy – it exists, you just might not know how everybody is doing it. And what we’re seeing as the catalyst for this, is someone saying, “Okay, I understand I need governance and management around all of this, but I don’t even know what all of it is now,” that kind of light bulb going on and saying, “Wait, we’ve got a bigger problem here than we thought, now let’s start to get our hands around it.” And what we see happening is… They don’t wake up thinking about it, until someone puts the magnifying glass on that expense report, or on that business problem, or they say, “We have to achieve something really, really quickly,” and the business processes don’t exist to do it as fast as they want it done, and one person knows how, and they go off, and they spin up instances on a public cloud platform to get access to compute and storage faster than they can do it by ordering something else. Typically, those inflection points, if you will, are driven by those critical success measuring points, or checkpoints, where are we going to meet this deadline, are we going to serve this customer, is this product going to launch on time, are we going to make our number? Those are opposite sides of the same coin; expense, as well as then profit and revenue, direct growth of the business, or what are we spending money on and why does it seem like we have too much money going towards technology? Where it gets really sideways – and I think you’re spot on with this – is it gets incredibly difficult when you look at organizations that get a little bit bigger and little bit more diverse, and right now everybody’s more diverse because people are located everywhere, and services are getting spun up right and left, by people trying to get their job done in new ways. That’s really changing the whole game for organizations, because those expense reports – again, it’s super simple. Those expense reports are exploding, and all of a sudden there’s thirty five or forty different services that people are using that they were never using before, because they couldn’t, and now it’s really easy, it’s just another credit card, and away they go. And it’s really changing the name of the whole game, because as people are looking at what a hybrid environment looks like, they’re sort of dropping the term cloud and it’s becoming hybrid in the sense of what are all of the services that I’m using? Where are they located? Why do I need them, how do they need to connect, what are the governance requirements for it that allow us to do what we need to do, in a really secure and in a managed fashion? I think that as we see the continued sort of… Remote work model… Become more comfortable, and become… It’s already come, but it has become more comfortable for people to say, “Yeah, that’s the way it is, that’s how we’re going to do it.” We’re going to see this expand for quite a while, and then we’ll see sort of the shift back of a little more control, a little more governance about it when we see where those edges really lie.
Max: [08.51] Cost is an interesting animal, right? I mean, you look at this from a couple of different places, right? You can talk about cost in terms of reduction in costs, you can talk about cost and predictability of costs, I mean, these are two conversations I have a lot related to… Specifically public cloud spend; what are we even spending money on? We don’t know. Are we spending money properly? We don’t know. Can we spend less money? We don’t know. But that’s difficult, because when you look at the economics behind a public cloud and you say, “Okay, shifting this out of public cloud into private cloud,” it’s a substantially different pricing structure, and a massive — in some cases, it’s a massively lower bill, and there’s a certain amount of disbelief, of… There’s no way it’s this big of a difference for us to go from this public cloud vendor into a private cloud, I mean — How do you overcome that obstacle? Because when you say, “Okay, we’re going to cut your monthly spends by… This massive percentage,” and people say that that can’t be possible, you’re not telling me the truth, you know, this objection is common.
Chris: [09.56] Right. The two areas — and I’m not trying to oversimplify this, but the two areas that pop up the most are in elasticity and data ingress and egress, and we’ll try and stay above the technology fold on this as we talk about it, but that’s really where it hits. On the first side, let’s just talk about instances right, and elasticity. In many cases, when people put workloads into the public cloud, they move that workload, that application, whatever, and it blends, and it gets turned on and it runs. It’s running in a steady state, but that steady state isn’t optimized for anything – it wasn’t optimized where it was running before, it isn’t optimized now and it landed and was migrated into the public cloud, typically in a lift and shift model. So, all of the advantages that the cloud presents from a cost perspective were never taken into consideration with that workload, ever. It was just simply, that’s cloud, let’s move it there, this is a great thing to do. It’s super, super common and it happens on one workload, then two, then five, then ten, then twenty, then fifty, then a hundred, then however many you have, and all of a sudden you’ve got this endless stream of applications and workloads that are running and they’re all running steady state and they’re taking zero advantage of elasticity and any of the benefits and the services that the clouds provide. You’re essentially just renting a computer at that point in time, which is not essentially very efficient. So, that’s the first area. The second point is to then look at what the use of data is in an organization, and this is a little bit more complex, because it typically happens when an organization has an application or applications that are very data intensive, and they’ve architected the system intelligently enough to be in the cloud, but they haven’t really accounted for the fact that the ingress and egress needs associated with that data are very, very real. And, it’s not uncommon for a five or six figure a month bill to result from nothing more than the data ingress and egress fees, and whenever we’re working with an organization that comes across these cost issues, we always point to those two areas and say, “Well, what is the state of the computer? How are you using it?” It’s always like, “Well, it’s there and it runs.” Okay, flag number one. The reason why it’s more expensive is because it’s not designed to be used like that, it’s designed to be used in an elastic, responsive model. The flip side of that is on the data side, it wasn’t designed for that. It was designed for different purposes. Now there’s ways around it, but in most instances, it’s very, very, very complex, and the cost of modifying an application to work in a way to take advantage of the cloud on the data ingress/egress side would exceed what it would to just put it in a bare metal environment. By typically looking at those two areas, we really identify about ninety percent of the cost issues that organizations run into. The one caveat to that is that when you look at the services on a cloud platform, so if an organization is using the AI/ML components, or VR or any sort of… Pack, quote-unquote packaged service on those cloud platforms, those are super, super efficient, and they look really expensive, until you realize what you’d have to do to go get it someplace else. So, you see a big number, you see a five figure a month or a six figure a month bill, and somebody says, “Well, wait a second, why are we spending this much for this service?” And you realize what it would take to go get it someplace else, it’s like, “Oh, no, no, it really is more cost effective in that way.” So, there’s a lot of nuance there, but it’s really in those two areas, and then kind of the trailing on the service side, that it’s… I don’t want to say it’s simple, but it’s pretty straight forward in terms of identifying where those hiccups occur, and then what the ultimate cost implications can be.
Max: [13.37] I mean, this comes a lot from experience and expertise, I mean this is part of the reason why ServerCentral and Turing Group are now one company, of expertise and capabilities on both sides. So now, with the combination of your two companies, why ServerCentral Turing Group versus somebody else? Where are you guys positioned, what are you best at in this market that somebody should say, “I have this problem, bingo, this is definitely who I should talk to.”
Chris: [14.01] That’s such a loaded question.
Max: [14.02] Of course it is!
Chris: [14.07] Where we really excel is when an organization has an increasingly complex environment, they have a number of moving pieces in their business – not on the technology side – in their business – that are creating very dynamic and rapidly-changing requirements. When that exists, and there is a significant amount of need being put on the technology organization – and I use that term very broadly, because that’s going to mean people who are focusing on desktops and devices, people who are focusing on services and infrastructure, people who are focusing on networking, the whole gambit of hte IT spectrum… When they’re just getting so much put on top of them because the changes in the business and the direction of the business is so dynamic that they can’t keep up, that’s where we really excel. What we do and where we really differentiate ourselves, is that we have the ability to walk in and say, “Okay, that’s interesting that you have this environment,” and we can take care of that and we can manage that for you, and we can optimize that and we can deliver that back to you as a service, as it exists today, whatever that is.” If you want that to then evolve over time, and become cloud-native, we can work with you in that process, and as you pursue that path, how much of that do you want to own, and how much of that knowledge do you really want? And being in a position to allow our customers to make those decisions – and those are really difficult decisions, because in most instances they want to own it all, and then you show them a pathway of what that will be, and how you’ll work with their team for everybody to gain this knowledge and experience on different cloud platforms, different virtualization platforms, and allow everybody to quote-unquote, level up… And then they realize, “I’m not going to hire out people that are going to do this, you can do this? Why don’t you just do this for me and I can focus on these four business issues.” And what typically happens, and where we see the most — we hope, I should say our customers see the most value, is that as they move forward in this, they’re very quickly recognizing that they can focus on what is important to their business, not what is important at the technical point. They can say, “We need x,” whatever x is, in order to be successful. We can then deliver that, and they don’t have to worry about it. They know it’s there, they’re now focussed on that higher order business challenge, and away they go. And that’s a little bit hand wavy, because a lot of organizations talk about that, but what we’ve really been able to do over the past twenty plus years, is demonstrate that and deliver it across platforms, and across the evolution of how organizations work. And you’d be amazed how many companies today – and I know you see this all the time – they have an incredible amount of infrastructure, an incredible amount of applications that just are. And they don’t really know why they are, they don’t know what value they still provide, and helping them make the determination of what needs to exist and what doesn’t need to exist, and doing that honestly, because it’s a really hard conversation to say to someone, is that… “By the way, thirty percent of the applications that you want to move to the cloud, you need a just end of life theme, you don’t even use them. Why are you here?” All of a sudden, that’s basically telling somebody that the work you put in doesn’t deliver any value. Yeah, probably…
Max: [17.13] Uncomfortable.
Chris: [17.15] Yeah, it is, it’s an uncomfortable point of the conversation, but it’s not atypical – we were talking about this last week, just before the holiday, and we’re looking at all of this data about how many workloads… When a company comes to us and says, “I want to do cloudy things, help,” how many workloads actually move to the cloud? So, we just sort of normalize this and said, “Out of every hundred workloads, about thirty seven of them can move to the cloud.” About forty-five of them, roughly, don’t even — might just end up being the end of life, they’re not being used. That’s forty-five percent of the applications in an organization, it’s like, “Why are they here?” It’s like, “Because they’ve always been there.” And all of a sudden you realize there’s a pretty significant transition in what you need to do, what resources are available, both financial and human capital, to achieve what you want to achieve, when you look at forty-five percent of something that doesn’t need attention. And by taking the time and investing the… Really the passion that we have for technology, and the passion that we have for solving problems, to address those issues, we can really demonstrate something meaningful for an organization, and that doesn’t really happen. Most of the time, things just get migrated because somebody wants to migrate it, and it really isn’t the right thing to do.
Max: [18.34] And you touched on this a little bit, a lot of cloud decisions and applications in the cloud and where applications actually live in data… You know, all these things are very nuanced. I mean, as an example I was reading this week, I think there’s now four or five different ways you can run Kafka inside of AWS, and which way is the right way for you? You know, there’s massive cost implications on each selection. If you pick one versus another, it could cost you three times as much, and be less performance for you. So, keeping track of all that becomes a very interesting challenge for organizations.
Chris: [19.03] Well, when you think about the way that the cloud platforms are designed, right… If you go back a little bit in time – not a long way – those platforms were designed to provide base functionality that people really needed and couldn’t’ acquire easily: bandwidth, compute, storage… Obviously memory is associated with that… But kind of the basics, like it was really hard to go to a — through a procurement process and buy these things, instead of just swiping a credit card and away you go. What happened is, the value in those platforms evolved so rapidly to become those services, just as you said, and there’s so much opportunity for innovation on those services that they took — every cloud platform took the model of improving and innovating in the ways that they know how, and applied it to these platforms. So, do you know how fast we can do this? Let’s go! And they all did it – Amazon does it, Microsoft does it, Google does it, you name it. It doesn’t make any difference. It’s like, why are they moving so fast? Because they can. Because that’s how quickly this is evolving, and if you don’t keep up with it, you do run that risk of really overpaying or being in the wrong place, but by the same token, you also have this opportunity, this sort of guiding light, it’s a beacon if you will, that’s going to help you identify what you can do, and what you might want to be paying attention to, and using that to help inform the decisions you want to make. So, the idea of the technology being subservient to a need of the business becomes very, very critical, because you could have an unlimited number of services, but if you don’t know what to do with them, all you’re going to do is spend money exploring them, instead of saying, “Why is this there? What does it do? What can it accomplish? Why is it designed to accomplish that?” It’s like you said, why are there n number of ways to run Kafka on AWS? Why are there three hundred and fifty thousand different instance types on a particular cloud platform? Who can keep track of that? Nobody. So, you really have to stop and think, what you want to get to. And it’s interesting to me and to us as an organization when you have these conversations both internally and with our partners and customers a lot, is we’ll talk about what is it that you want to do in the direction that you want to go, because there’s somebody investing in that direction, there’s somebody investing in that technology that you can leverage, you don’t have to learn anymore. You can draft almost everything. If you want to learn and be on the absolute bleeding edge, there’s still somebody in front of you providing a little bit of a draft that you can get into a really understanding, where is it going to go, and how is it going to evolve? I think that the role that organizations like ServerCentral Turing Group plays, is to help people understand that, and to say you have to think about this differently, it isn’t just technology, it’s the direction of your business, it’s the needs of your customers, what are their requirements and which way do they go? And now more than ever, we’re seeing that and it’s a really long answer to your question, I’m sorry, but now we’re seeing this in spades because what we’re talking about is a digital-first expression of every single business. It’s no longer nice to have, you have to have it. Every business, no matter what it is that you do, is going to have a digital first expression, and that idea of digital transformation was nice or cute or interesting or, you know, good headline fodder, or whatever — however you want to look at it, but it’s reality. And that’s a really harsh wake-up call for a lot of organizations that have never thought about that. I think what we’re going to see in probably the next six to twelve months is a tremendous amount of growth in the adoption of those types of services as they mature and help people move forward faster, than they could any other way. I think it’s really going to spur the growths of those types of cloud platforms, because it isn’t going to be about what instance type can you run, it’s going to be about what services exist that can be tapped into that bring that digital representation forward very, very quickly, and how does it align with the business? That’s a completely different topic, a completely different conversation, but I think that’s what we’re going to be having in probably the next four to five months at the latest.
Max: [23.08] Chris, thank you for scratching the surface of this for me before we fall too far down the rabbit hole. You know, it’s extremely nuanced, what seems simple on the service is actually very complex when you start to get into it. I mean, what you’ve said about, just… I mean, forty-five percent of running applications in a company on average just not being necessary anymore. This relates everywhere and everybody sees this, but taking the time and care to actually go through that and say, “Don’t migrate it, get rid of it! You don’t need it, it’s already been displaced or redundant, or you can just make it redundant and displace it,” I mean, that’s… That’s a big win, it’s efficiency, right? People don’t need to touch all these things on a day to day basis, so.
Chris: [23.53] They don’t, and when they realize that they don’t have to do that, the business can achieve its objectives by just taking that… That pause. Taking just a few seconds to take that big breath, realize what’s going on, realize what they want to achieve, and then align all of those pieces… You can do a lot of really amazing things, but when you try to lift everything and move it, or you go into it, obviously not blindly, but you go into it sort of head first, and try to take everything and make it happen simultaneously, it’s incredibly difficult. And the biggest challenge is really just helping organizations understand that if you go really, really fast through this process, you’re going to spend more money, that’s going to end up taking more time than you ultimately think it will. You have to plan, you have to organize and you have to approach this in a very logical manner, and when you do you’re going to get all those benefits that you want. All of them. But if you don’t, you’re not. And that’s hard – you know? Nobody wants to hear, “Slow down.” Nobody wants to hear, “Well, hold on a second, let’s talk about that.” They want, “Let’s go, let’s go, let’s go.” And it takes some doing, and it’s just as you said, and I think it’s an excellent word – there’s a lot of nuance in that, but when organizations do it, and they understand that that investment and time is going to pay dividends, then yeah, they really see those dividends, and they actually see them really, really quickly.
Max: [25.10] Awesome. Chris, thank you so much for your time today, I appreciate it.
Chris: [25.13] My pleasure Max, thanks for having me. Anytime.
OUTRO: [25.16] Thanks for joining the Tech in 20 Minutes podcast. At ITBroker.com, we believe tech should make your life better, searching Google is a waste of time, and the right vendor is often one you haven’t heard of before. We can help you buy the right tech for your business, visit us at ITBroker.com to schedule an intro call.