Hewlett-Packard Co. veteran Frank Rauch was hired by VMware Inc. in July 2012 to help run its channel. The vice president of the Americas Partner Organization at VMware honed his channel expertise at HP, where he served as vice president of Enterprise Servers, Storage and Networking Channel Sales from 2006 until 2012. Rauch joined HP back in 2002 when the vendor acquired Compaq Computer Corp.
SearchITChannel met up with Rauch at VMware Partner Exchange 2014, held Feb. 10 to 13 in San Francisco, where the Americas channel chief talked about his goals since getting on board with VMware and the company's strategy for taking partners to what VMware calls the next reality.
What are your top three goals since joining VMware?
The whole thing is about numbers. We know our average transaction size … and we know how many partners … we need to drive that.
vice president of the Americas Partner Organization, VMware Inc.
[That] means doing the enablement around those three technologies; finding the right partners who want to move forward with us; getting the hearts and minds of the engineers, reps and CEOs; and taking the good work that Dave O'Callaghan [senior vice president of global channels and alliances at VMware] and others are doing and operationalize that in the Americas theater.
The second goal is to take advantage of the installed base, to be able to use our data and [partner] data to produce analytics that will identify the next targets -- in other words, to be able to pivot off of vSphere and be able to cross-sell and up-sell into the various mobility clouds that we have. … SDDC [is] all about management, it's all about apps. Virtual backup is a big issue for us, [as is] cloud automation and federating outside of the data center.
The third priority is to be able to do the day-to-day stuff; it's really about scalable sales plays. It's about taking products like vSOM [vSphere with Operations Management], the mobility offerings, hybrid cloud [and] virtual backup and to be able to get … the 35,000 or so VSPs [VMware Sales Professionals] that we have in the Americas energized about going after these scalable sales plays. Also, to be able to implement the programs that we're getting from Dave's group and to be able to make sure the reps know how to monetize those programs to do the right enablement and to get that cadence where they're making calls on those customers in the Americas to drive these important plays.
How to you identify the partners that will move forward with VMware as you described?
Rauch: I think we have relatively good data on the partner network, and this is very much an opt-in [strategy]. When you hear VMware executives talk about the various opportunities, they're very energized and optimistic about it. So, we do propensity analysis on the partner network; we have about 12 different data models that we run against the partner network to be able to understand exactly which partners not only want to be able to sell the product and want to opt in but also have the attributes that we're looking for to be able to sell the solutions.
So it's a little bit more data-driven and methodical than it was 18 or 19 months ago.
What are the attributes of the partners that will drive the company vision?
Rauch: So let's talk about the SDDC. [Selling SDDC products requires] a strong VMware partner. Who is the target? Someone who already has vSphere, who likes to partner, who likes VMware. Then you need executive buy-in because they need to invest … in engineering resources, etc.
Also, the OEM affiliation is important. So if they're selling [NetApp] FlexPod, [VCE] Vblock, if they're selling converged infrastructure from HP, Pure from IBM, etc., that's normally a great attribute and a leading indicator that they're going to be able to sell SDDC.
Where are all the engineers, or engineering talent, going to come from?
Rauch: We've identified the VTSPs [VMware Technical Sales Professionals] in the Americas. Right now, the game is, How do you get to them? We're looking at various marketing solutions to develop communities around these engineering resources, around these sales resources -- to be able to give them sales tips, to be able to inform them of what's really the best practice to drive mobility, hybrid cloud or SDDC, etc.
The whole thing is about numbers. We know our average transaction size in each of these categories, and we know how many partners and how many engineers and salespeople we need to drive that.
This sounds like a to-do list.
Rauch: No. Without getting into numbers, we've seen terrific results in the Americas in terms of all the categories I mentioned, whether it's cloud management, mobility or hybrid cloud. The Americas has been one of the early adopters for all of these solutions.
So, I think that partners, as evidenced by the 4,000 people [at VMware PEX], are already energized and are investing. [They're not investing just because] Carl [Eschenbach, VMware president and chief operating officer] or Pat [Gelsinger, VMware CEO] just said, 'I have a great idea; we're going to go after this software-defined data center.' [All of VMware's investments] -- DynamicOps, Wanova, Nicira … AirWatch, Desktone, etc. … are setting us up to be there. The fact that we have 500,000 customers, we have the analytics, we have the Net Promoter Score, [and] the market really likes VMware sets us up really well.
That's not being arrogant. It's being confident to be able to go after this market.
The other reason why partners are investing is because the market is predicted to grow year over year. When we look at the compound annual growth rate [CAGR] in most of the categories that we're selling in right now, it's 20% to 30% CAGR in SDDC, hybrid cloud and mobility.
What do you see as your biggest challenge when it comes to the partners?
Rauch: I want to say this the right way. … It's not moving fast enough. It's being able to accelerate through this window of opportunity that we have … and it's not going to be an endless window.
That means getting channel partners behind it, putting the right amount of demand generation, the right amount of MDF [market development funds], being very specific about how we're using the money, doing the right training and enablement, and really driving the market for the partners and driving the results in a time period that could be nine months, 18 months, 24 months. …
When you meet with partners, do you offer them a roadmap?
Rauch: We have business plans that we develop. We have pro formas that we give them that we talk to them about based on the size of their installed base, based on their VMware business and based on the business that they're not doing with VMware.
So, it might be a $100 million partner that has a server, storage and network makeup. You can pretty much chart out what that VMware revenue would look like for the partner. Then, to me, it's about planned outcomes, putting together initiatives, joint plans where there [are] co-investments -- partner, VMware and maybe even an OEM or two -- to be able to drive an outcome.
Then, it's quarterly business reviews, it's having a cadence where we're checking in every other week, and it's having a governance model around that outcome.
Is VMware bulking up its resources to be able to work closely with its partners?
Rauch: I don't think you'll ever have enough, but I think we're very well invested in the channel. From the time I joined 18 months ago, the executive team has been extraordinarily supportive. So they've invested in the channel, and those numbers keep going up in terms of headcount. Some great examples are specialists. We have management specialists, mobility specialists, hybrid cloud specialists that are calling on partners. … That didn't even exist 18 months ago.
Would you talk a bit more about the roadmap for partners?
Rauch: Here's how we're looking at it and how I think partners are looking at it. … I think they need a story, and I'm going to start there.
The partner's story has to be more than … 'I think your servers are running a little bit slow or a little bit old by now, and your storage is a little old and you need more storage.' I don't think that works anymore, and I think partners have acknowledged that it doesn't work anymore.
So now, what we're trying to convince them of is data center agility -- call it the SDDC -- and the ability to federate out of the data center and the ability to take that data center and the relevance that they've built in that data center and move it down to the device level.
So the roadmap starts from various spots: Some partners are going to be great management partners, so you pivot off of management and you roadmap them into mobility and hybrid cloud; some partners are going to be born in the cloud, so you take them the other way down the stack. That's really what that roadmap looks like.
We have a great opportunity in front of us, and it's shame on us if we don't really take advantage of it.
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