Neri On 'Removing Several Layers' From HPE, His 'Incredible' Partnership With Meg Whitman, And The Cloud Technology Partners Acquisition

Neri On What's Next For HPE

Hewlett Packard Enterprise President Antonio Neri says the opportunity to "clean sheet" HPE with a sharp focus on making the company easier to do business with is going to pay big dividends for HPE and its partners.

"To me, it is about giving the channel partners the ability to make more money easier," said Neri of the HPE Next intiative. "We know that despite the fact the channel loves us, which is reflected in studies and everything we hear from partners and customers, there is a tremendous amount of opportunity going forward by removing the barriers that are unfortunately in the way because of the complexity in the business sometimes."

The discussion with Neri came after 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.

What is the message to partners as you lead the charge on the HPE Next initiative to increase cost efficiencies and drive sales growth?

HPE Next is to really take advantage of the unique opportunity we have to 'clean sheet' our company and to create a fit-for-purpose organization to compete in the marketplace, which ultimately will benefit our partners. The goal of HPE Next is to simplify, simplify, simplify everything we do -- in the way we make decisions, the way we drive innovation, and the way we engage daily with our customers and partners. What you are going to see over time is a more agile and more focused company. We are modernizing our tools. Think about key processes like order management, pricing, enablement.

How big an economic impact is the HPE Next initiative going to have on partners with regard to partners' ability to get better pricing and faster delivery?

I am super excited about this. I have been with the company going on 23 years. This is the best time to be at the company.

Ultimately, we want a company that is easy to work with and easy to do business with. My view is partners are going to see a company that is easier to do business with and much more agile with a modern set of tools and applications to engage them. They are going to see people empowered – people empowered to make decisions closer to the customer.

In the end, HPE Next will remove several layers in the organization. Let's remember, we are here to make money. To me, it is about giving the channel partners the ability to make more money easier. We know that despite the fact the channel loves us, which is reflected in studies and everything we hear from partners and customers, there is a tremendous amount of opportunity going forward by removing the barriers that are unfortunately in the way because of the complexity in the business sometimes.

What is the channel commitment going forward?

A week or so ago, we made the announcement that HPE and Nimble will be [100 percent] channel-only. If anything, I continue to see increased growth and coverage through our channel partners. Through HPE Next we are defining where we want to participate, compete and win in terms of geography coverage. One of the things that the spin mergers have taught us is to really be much more focused on the analytics of how we sell in the market. You are going to see we are going to be much more narrowly focused there, which by default creates more opportunity for the channel to drive that coverage.

True to our spirit to be a channel-first, channel-led company, partners are going to see a company that gives more opportunity to the channel, better and more focused innovation in the modern world of hybrid IT and edge computing and, ultimately, a portfolio that allows them to compete and win with us.

How do you feel about the company prospects moving forward now that you are president?

I have been at the company for 23 years and never have I been as committed as I am today. I grew up in this company. I have an emotional connection with this company. There is also a responsibility I feel back to the company. This is a big responsibility.

I am involved in the key decisions with [CEO] Meg [Whitman] like where we invest our R&D money, the coverage model, how we make it easy for customers and partners to work with us, and also how to create an environment for our employees to come to work and have fun. Obviously, employees want to contribute but also have fun in everything they do.

For me, being president is just a title. Nothing has changed from a cultural perspective with how I approach the job. Meg and I are incredible partners. We are extremely complementary to each other. I know she is unbelievably committed to HPE and you can see it in the results and in what we have done together with the executive team. This is a very well-oiled machine. Now we have an opportunity to go change history.

What does the Cloud Technology Partners acquisition bring to HPE?

I am excited about the announcement to acquire Cloud Technology Partners. As you recall, our strategy has been focused on three things: make hybrid IT simple, power intelligent edge, and then bring the services expertise to make it all happen for our customers. This is one step in our portfolio completion around advisory and professional services.

It is all about helping customers to find the right mix of hybrid IT, power that mix and then optimize that mix. Obviously, that starts with the workloads and the data. That is what CTP brings to the table. It is that expertise and that intellectual property including tools and analytics to make that engagement very efficient for customers. Obviously, as you know, we do this in a very channel-friendly way in the sense that now we can take those tools and technologies and put it into our portfolio with HP Pointnext.

Will the Cloud Technology Partners tools and technologies make their way to HPE partners?

By default as we move forward with them we are going to integrate those solutions into our packaged advisory services for the channel. This is a great complement to what we already have in our consulting portfolio with HP Pointnext. And also it is obviously a great complement to what we are doing with our solution integrators. All in all, it is an excellent acquisition: core to the strategy and the investments that we have made whether it is organic or inorganic. It is a reflection of staying focused on our strategy.

Talk about the great results in the quarter with strong growth in Aruba and server sales growth?

First off all, I want to thank the channel partners. Obviously, we would not be able to deliver the results we did in Q3 without channel partners. That is a testament to the relationship and the loyalty we have for each other. I am very pleased with the outcome of Q3.

We had growth in the key strategic areas: SimpliVity was up more than 200 percent; our core ISS business, which we obviously drive with the channel, was up 13 percent. That is significant. Our all-flash [business] was up 30 percent with Nimble. Nimble is now seeing the benefits of being part of a larger company. Aruba was up 30 percent on the wireless network and mid to high single digits on the wired side. High-performance compute was up 40 percent. We expanded profitability sequentially. So we see the momentum.

What do the results say about the company's product portfolio and strategy?

We have a portfolio that customers love. Our strategy is resonating with customers, and we have the best go-to-market on the planet with our channel partners. Our channel partners grew with us and that is what makes me happy. In the end, we have built an incredible community in which we compete and win together.