Data center News
HPE CEO Whitman To Channel: I Have A Long-Term Commitment To HPE, Partners, And 'The Mission We Are On'
Hewlett Packard Enterprise CEO Meg Whitman told CRN she is firmly committed to leading HPE into the future.
"I would like to underscore to partners that I have a long term commitment to HPE and to the partners and to the mission that we are on," said Whitman in an exclusive interview with CRN Tuesday. "Yes, I talked to Uber [about the CEO job] at the end of their process because it is a business model I am very familiar with. It reminds me of eBay [where Whitman was CEO from 1998 to 2008] in many ways. But it wasn't the right thing. I think HPE is very special in its own right."
Whitman had asserted in a tweet on July 27 that she planned to remain the CEO at HPE after reports that she was on the short list for the Uber CEO job. The Uber board, however, spoke to Whitman about the Uber CEO job over the weekend of August 26 after former GE CEO Jeff Immelt took himself out of contention. The Uber board ultimately selected Expedia CEO Dana Khosrowshahi.
(3/3) We have a lot of work still to do at HPE and I am not going anywhere. Uber's CEO will not be Meg Whitman./**/ /**/
The Whitman pledge of "long-term commitment" came as HPE delivered better-than-expected earnings results for its third fiscal quarter ended July 31. The company's core server sales were up 13 percent; it reported 200 percent growth in SimpliVity hyper-converged sales; 30 percent growth in all-flash sales driven by Nimble and a whopping 30 percent growth in the Aruba wireless LAN business, with 70 new customers wins.
"Nearly 100 percent of the Aruba business goes through the channel and 70 to 80 percent of the core enterprise group business goes through the channel, so the channel did a great job," said Whitman. "The channel deserves a lot of credit for the results of the company both the new logo wins as well as selling more into the installed base."
Overall HPE reported non-GAAP diluted net earnings per share of 30 cents per share on sales of $8.2 billion. The Wall Street consensus was non-GAAP diluted net earnings of 26 cents per share on sales of $7.49 billion. HPE shares were up $0.70 (4.99%) to $14.74 in after-hours trading on Tuesday.
Whitman told CRN the strong results are evidence that the reinvention of HPE into a smaller, more nimble company focused on making hybrid IT simple, powering the intelligent edge and providing digital transformation IT services is paying off in the form of higher sales growth and margins for partners.
"The partners should be pleased by the results of the company," said a charged up Whitman. "This will give their customers the confidence to buy from HPE. I am feeling good about where we are as a company, and I am feeling great about the partners and distributors that we do business with every day."
Whitman said she is especially proud of the stabilization of the core server business which will help drive better results for partners. HPE's strong Synergy composable infrastructure sales have even driven up sales of bread and butter C7000 blade sales, she said. Customers feel confident in the server road map with blades and Synergy, said Whitman.
HPE partners, for their part, say they couldn't be happier that Whitman has reiterated her commitment to lead HPE into the future. They say over the last six years Whitman has taken HPE from a debt-ridden company with long-in-the-tooth products and a demoralized partner network and refashioned it into a next generation infrastructure provider with a re-ignited innovation engine and a fired up channel.
Frank Vitagliano, the CEO of Computex Technology Solutions, No. 121 on the CRN SP500, one of HPE's top Platinum partners, said he was ecstatic that Whitman is staying put at HPE. "I give her a lot of credit," said Vitagliano, noting the national managed services provider powerhouse's HPE business is growing. "Meg has done an excellent job since she came to HPE. I am sure the entire solution provider community is very pleased she is staying with HPE."
Whitman has been "open and honest" about her plans to transform HPE and the importance of partners, said Vitagliano. "For the solution providers what really matters is that we understand the direction that vendors are taking," he said. "That means being open and honest and communicating. Meg does that really well."
Vitagliano says Whitman also deserves credit for what appears to be setting up a strong succession plan by promoting Antonio Neri just two months ago to the president position.
"That's also a positive move," he said. "Antonio gets the partner community. He held a roundtable at Discover and it was pretty clear that he gets the channel. He considers solution providers a major part of the go to market. I would be happy with him as the next CEO of HPE if that is what ends up happening. Solution providers should be happy with the direction and leadership of HPE."
Kelly Ireland, founder, and CEO of Orange, Calif.-based CB Technologies, an HPE Platinum partner, said Whitman's leadership inspired her to remake CB Technologies into an innovator that has put the company at least 18 months ahead of most other partners. "We have looked at Meg as a compass as to where the industry was going," said Ireland. "We followed Meg's direction, and we are extremely happy about it. We feel we are a minimum of 18 months ahead of the majority of the VARs because we listened to Meg and how she guided HPE. That is a fact."
Ireland said she is looking forward to how HPE is going to integrate innovative partners like CB Technologies into the go to market strategy. "I see two paths emerging the VARs who have done what they have always done and another group being innovative on their own, taking HPE infrastructure and services and wrapping those around their own solutions," she said. "We have the engineers and subject matter experts that can drive innovative solutions versus ones that are staying on the path of transactional selling."
Whitman said HPE is accelerating its reinvention of the company with HPE NEXT initiative aimed driving even great customer facing efficiencies and sales growth for HPE and it partners.That could pay off, for example, in faster price quotes for and more rapid delivery to customers, said Whitman.
"For the past five or six years we have talked about being a more partner friendly company and being easier to do business with," said Whitman. "Virtually all of the partners would say we have made progress, but there is more work to do with the ability to quote fast, turn around orders faster, and to have a quicker supply chain."
Whitman says she envisions simplified supply chain which could result in dramatic benefits for partners. "Everything we are doing is trying to make this company to be simpler and easier to do business with so partners can be more successful selling Hewlett Packard Enterprise," she said.
As for the HPE acquisition on Tuesday of Cloud Technology Partners (CTP) – a born in the cloud agnostic solution provider with deep AWS, Google and Azure expertise, Whitman said partners should rest assured that HPE will continue to be a "channel first" company.
"We are very much still a channel first model and a channel first priority," said Whitman. "We always say that if the channel has the services to serve their own customer base, we will not get in the way, they should go do that."
If partners do not have the services capabilities customers are looking for they can augment their services capabilities with HPE Pointnext consulting and advisory services, said Whitman, noting that CTP is focused on the Fortune 100. "We never want to get in the way of the services that partners provide to their customers," she said. "If a partner has advisory and transform services they are providing their customers with so be it we won't get in their way."