Jeff Clarke On Phase Two Of Dell EMC's Storage Share Takeover: ‘We’re Not Done’
Dell Technologies Vice Chairman Jeff Clarke, who architected the comeback that propelled Dell EMC to the No. 1 position in the storage market last year, is upping the ante with phase two of his innovation-fueled storage master plan.
In fact, the 32-year Dell veteran, known as Michael Dell’s right-hand man, is lining up all the necessary pieces to widen Dell EMC’s storage lead by leveraging its now-unified development team to launch a breakthrough new midrange product.
Clarke said the company’s top storage engineers are hard at work building the ultimate midrange storage product line based on a ground-breaking micro-service, container-based architecture.
The heart of the product line is a “new file system and a new modern software stack that is going to be a platform for us to go from NVMe to NVMe over Fabric to storage-class memory to persistent memory architecture over time,” said Clarke, who initiated the major changes that allowed Dell EMC starting in the first quarter of last year to overtake Hewlett Packard Enterprise as the No. 1 worldwide storage revenue market-share leader.
That new modern software stack is designed to allow Dell EMC to innovate in the storage market at an unprecedented rate. “Once we get that foundation in, my ability to iterate new features and new capability is going to be absolutely faster than we’ve ever done,” said Clarke, who as vice chairman of Products and Operations oversees Dell’s global product organizations and supply chain.
Clarke has pledged that every existing Dell EMC midrange product will have a seamless data migration path to the new platform, which is slated to be available in the second half of this year.
In addition to the new micro-service, container-based architecture, Clarke is pushing the storage envelope with a massive artificial intelligence development charge.
Partners got the first look at the artificial intelligence offensive last year with the launch of Dell EMC’s new enterprise storage product line, PowerMax, which the company has dubbed the world’s fastest storage array.
Built with end-to-end NVMe and up to 10 million IOPS (Input/Output Operations Per Second, a common storage performance benchmark), the Dell EMC PowerMax features a machine-learning engine to optimize performance. “Our PowerMax makes 6 billion decisions a day,” said Clarke. “It’s got artificial intelligence built into it ahead of anybody else. It has the greatest AI engine in storage.”
Dell EMC views AI as a way to reduce the daily tasks of storage administrators by making decisions on its own, allowing partners and customers alike to focus on game-changing digital transformation initiatives. “The data migration work that we’re doing is going to have an AI engine in there so we know how to pull off our legacy arrays into the new array,” said Clarke. “You’ll see us apply artificial intelligence and machine learning across all of the portfolio, as well as build AI-specific workload servers like we did with the [PowerEdge] R940xa [server], for example.”
Key to the Dell EMC storage phase two offensive this year is the infrastructure behemoth’s $4.5 billion annual R&D budget—the centerpiece of what Dell founder, Chairman and CEO Michael Dell has called a year of investment and innovation.
Although unable to give an exact figure, Clarke said Dell EMC will be spending more storage R&D dollars this year compared with 2018. “We’re having two times as many developers working on the new things than we had just 15 months ago,” said Clarke. “They’re working on new innovative things and looking down the pipeline.”
Partners see Clarke as a storage mastermind that has given Dell a pronounced advantage in the intensely competitive storage market. They say Clarke’s landmark restructuring last year put the Dell EMC engineering teams on the same page for the first time since Dell’s historic $67 billion acquisition of EMC in 2016.
That restructuring put in place the framework for Dell EMC to overthrow Hewlett Packard Enterprise in the first quarter of 2018 to become the worldwide leader in storage revenue, capturing 21.6 percent share, up from 20.3 percent year over year, according to research firm IDC. HPE in that quarter held 17.7 percent share. Dell continued its market-share dominance in the second quarter by winning 19.1 percent of the global market, followed by HPE at 17.3 percent share.
Dell EMC retained its global market-share leadership position in storage in the third quarter of 2018 by capturing 19.2 percent market share, followed by HPE at 16.4 percent.
Dell EMC partners say that Clarke deserves a lot of the credit for the storage share gains. They say his decision to pull together the storage development engineering teams into a single group was a game-changer. The changes focused the Dell engineering teams on a single product line for each market segment from low end to midrange to high end, as well as a separate product for the unstructured file and object storage market.
“Our storage organization was siloed and compartmentalized [before the restructuring],” said Clarke. “It was to the point where you had fierce supporters of a brand or a product inside the organization and we were not necessarily stepping back and looking at market needs, customer needs and technology trends. My view 15 months ago, I had XtremIO, ScaleIO, VMAX, Unity, VNX, SC [Series]—all competing almost internally with one another and dividing up engineers and not sharing IP across the boundaries. It was highly fragmented and we weren’t all rowing in the same direction. Some weren’t even in the same boat.”
Fast forward to today, and Clarke has created what partners are calling a more robust and compelling product line in each segment of the market. “We have PowerMax, a new midrange product by the end of this year, and we have an entry-level product with the PowerVault ME4,” said Clarke. “We’ve become a single team and now we share IP [intellectual property], engineers, algorithms and methods that, quite honestly, we couldn’t before.”
John Byrne, president of North America Commercial Sales for Dell EMC, said Clarke has driven a storage market-share reversal in Dell EMC’s favor that is still playing out.
The hyper-competitive Byrne said the company wants any and all storage share that it lost before the storage turnaround. “For our primary storage—look, we lost some share,” he said. “We lost some share to NetApp and Pure [Storage]. We want it. We want to come back and take it.”
Part of “taking it” means getting Dell EMC partners working hand in hand with Dell sales reps to close more deals together with unmatched sales alignment and predictability, said Byrne, who headed up Dell EMC’s global channel organization in 2017 before taking over the top North America sales job. “What I’m telling my sales team is, ‘Build out your account strategy,’” he said. “Your strategy is—you’re an executive with ‘X’ amount of customers—build it out. What partners do you want to bring in? How many lines of business do you want to work with a partner on?”
Byrne said that over 60 percent of North America partners are doing joint account planning with Dell EMC. “I would like more,” he said. “When you look at how many customers my business will touch, it’s over 200,000.”
Dan McCormick, executive vice president of Davenport Group, a St. Paul, Minn.-based Dell Technologies partner and 2018 CRN Triple Crown Award winner, said the Dell EMC team is working closely with his company to win over new customers, which is boosting storage sales.
Davenport Group’s Dell EMC storage sales increased double digits in 2018 compared with the year prior, according to McCormick, who said Clarke has created a winning storage hand that will continue to pay big dividends for all of the company’s channel partners going forward.
“Jeff Clarke and the team around him have been able to really have a vision for both simplifying the product line, which to me means making it easier to understand the use cases and value delivery for a particular set of customer requirements, but they’re also continuing to innovate even within a traditional data center setting,” said McCormick.
“Storage solutions going forward will continue to take advantage of AI technology and get it faster by taking advantage of end-to-end NVMe. So as the demands for these products accelerate, performance will continue to deliver that back to the application. That creates a world of options for our customers in that they don’t have to think, ‘Cloud is new and innovative, and data center is old and legacy.’ The choices that are available for customers can really be driven by the economics, the opportunity, the end-user experience and the business model as opposed to having to figure out where innovation lives. Jeff Clarke and the team have really helped bring that vision in a way that I’ve not seen happen anywhere else with competitors in that space. The portfolio continues to evolve accordingly,” he said.
Clarke, for his part, said the company’s storage innovation offensive is far from complete.
“We’re not done with storage. We’ve stabilized the business. We now have a trend of share gain. We have a lot of share gain to claw back that we gave [to competitors] over the past four years,” he said. “I have just removed the barriers for us to be successful. I used my experiences of taking a highly capable and talented team to focus on fewer things. It’s working. I’m pleased. But we’re not done.