Partners: Hitachi Vantara's Consulting Play Will Boost IoT Channel Efforts

'As a partner, I look at it and go, I have another well-known partner now wrapped into this entity, so I can collaborate with them and use them in my opportunities,' one partner says of Hitachi Vantara's plan to merge with Hitachi Consulting as part of an IoT-focused reorganization.


Hitachi Vantara partners say the company's plan to merge with Hitachi Consulting is a good decision that will help the company accelerate adoption of its IoT solutions in the channel.

Japanese conglomerate Hitachi announced the plan to merge its enterprise technology subsidiary with Hitachi Consulting last week as part of a reorganization that includes appointing Hitachi veteran Toshiaki Tokunaga as its CEO. Brian Householder and Hicham Abdessamad, the current CEOs of Hitachi Vantara and Hitachi Consulting, respectively, will remain on the executive leadership team.

[Related: GE Digital Expands IoT Offerings As Partners See Renewed Focus: Exclusive]

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John Woodall, vice president of engineering at Integrated Archive Systems, a Palo Alto, Calif.-based solution provider, told CRN that Hitachi's plan to use the merger to expand Hitachi Vantara's Lumada IoT business is a smart move because emerging technologies like IoT and artificial intelligence require a "heavy services lift" that could benefit from consulting expertise.

"It takes several different types of skilled technical resources to understand the data that’s available to you to derive the value from that data," he said.

When Hitachi formed Hitachi Vantara two years ago through the merger of its Hitachi Data Systems storage and data center infrastructure business with its Hitachi Insight Group IoT business and Pentaho big data business, it was a step in the right direction, Woodall said. But the company was missing the services piece that is needed to handle the complexities of IoT, AI and big data.

"This formalizes and streamlines the ability for that single organization to go to market around their technology [and] wrap in the required services as part of a go-to-market strategy," he said.

An executive at a large system integrator, who declined to be identified because he wasn't authorized to speak publicly, said Hitachi Vantara's new consulting capacities could serve as the "tip of the spear" for digital transformation engagements, where more buy-in from the C-suite is required.

"One of the things technology companies struggle with is initiating the conversation at the right level," he said. "In the legacy IT services world, they are OK, but when you're talking about smart factories, emerging tech and digital transformation especially, you need to be initiating the conversation at the CXO level" — including executives with titles like chief innovation officer and chief digital officer.

Woodall said he thinks Hitachi Vantara's added consulting capabilities will serve as less a threat and more of a complement to the work channel partners provide.

"As a partner, I look at it and go, I have another well-known partner now wrapped into this entity, so I can collaborate with them and use them in my opportunities," he said.

Scottie Kearns, CEO and founder of Phase2, a Farmington, Utah-based solution provider, said he hopes that will be the case as he tries to dig into IoT and big data opportunities to differentiate his business. He said it's been challenging as a small company to look at Hitachi Vantara's large-scale IoT work on smart cities and rail systems and imagine how to monetize that on a smaller scale.

"Customers are still trying to figure out, 'what's the reason for all this data? Why am I doing it? What's important? What's not important?'" he said.

A Hitachi Vantara spokesperson said the company isn't sharing more details about the merger for now, but a quote from Householder in the press release announcing the merger indicates that the reorganization is expected to help both customers and partners.

"This is a great next step to bring two complementary organizations even closer together to help our customers and partners tap more broadly into the power of Hitachi to drive meaningful business outcomes," he said in a statement.

Partner Views On CEO Shakeup, Status Of Non-IoT Products

While Hitachi is pointing to a global expansion of its Lumada business as the main thrust for the Hitachi Vantara reorganization, the company said Hitachi Vantara will continue to develop and support its other products, including its legacy storage and data infrastructure solutions.

Joe Kadlec, vice president and senior partner at Consiliant Technologies, an Irvine, Calif.-based solution provider, said he doesn't see Hitachi Vantara's Lumada focus diminishing its other product lines, for which the company continues to bring out "substantial enhancements."

"I don’t believe they're moving all their eggs to IoT. I think this is another area where they see a lot potential," he said. "Their big storage customers love Hitachi. It runs, it doesn’t break, it's very high performing, its very reliable. They've done such a superb job there."

With the new reorganization plan, Hitachi Vantara's current CEO, Householder, is relinquishing the role to a longtime Hitachi veteran after less than two years on the job. Prior to becoming CEO in early 2018, Householder was COO for Hitachi Vantara and its predecessor, Hitachi Data System, which he joined in 2003 from the company's acquisition of FilesX.

Wallace, the executive at Integrated Archive Systems, said the fact that Householder will remain on Hitachi's executive leadership team is a "good sign." At the same time, he said, the new CEO and chairman, Tokunaga — who is board chairman of Hitachi Global Digital Holdings, Hitachi Vantara's holding company — will help create operational efficiencies for Hitachi Vantara.

"I think it's a necessary next step, and I think Hitachi's choice of CEO reflects how strategically important it is," Wallace said, referring to Tokunaga's nearly 30 years of experience in "successfully transforming Hitachi businesses," as stated in Hitachi's press release announcing the reorganization.

The CEO shakeup isn't the only change in Hitachi Vantara's personnel from up top, however. Most notably for partners, Mike Walkey, Hitachi Vantara's channel chief, departed over the summer and was replaced by former Cohesity Channel Chief Todd Palmer.

"The new regime has been extremely engaging and supportive so we're very excited," Kadlec, the executive at Consiliant said. "It's never been stronger."

While Hitachi said it will share more details about the reorganization in early 2020, Woodall said he suspects the company will discuss the merger at Hitachi Vantara's annual Next conference, which is happening in Las Vegas next month.

"Hitachi clearly wants to make sure they nail this part of the market," he said.