Time to value and speed is the new name of the game. How fast can I identify an opportunity – and alter my DNA/combine the right resources (people/apps/data) to create value I can then monetize it… These gaps are “leaps of faith” changes a). the value creation in the old world was punctuated/sproadic - not continuous as the graph on the left hand side looks. Esposidic, sporadic and punctuated by delays. Right side – is This is about smoothing out risk by reducing the quantum of change
Time. A nanosecond is a nanosecond is a nanosecond. We can’t change the element of time. It is constant. But what you can do is change what gets done in that time, Time has now become public enemy #1. We need to radically change the time it takes to get value from our investments. It’s not enough to just be converged, optimized, agile; we need to start thinking in terms of continuous. The key for customers is to be able to capitalize immediately – or at least faster – than competitors on new business and government opportunities.
Speaker Notes: The problem we’re seeing with many CIOs and system administrators in the data center is that they’re challenged to deliver traditional business applications while at the same time standing up new applications such as mobile and cloud native apps. Traditional business applications are built to run the business. There are applications such as ERP, your large databases, that have been pre-packaged, pre-tested by the software vendor and the hardware vendor and typically go through release cycles maybe once or twice a year. IT has been built around these for the last 20 to 30 years.
What we’re seeing in the emergence of the New Style of Business are applications that are the business. Such as applications for mobility and new cloud-native apps which drive revenue and IT is challenged to keep the business running with the traditional applications while standing up these new applications which are going to drive new business opportunities for their companies and new revenue opportunities. Gartner calls this bimodal computing where they see a strategy of maintaining your existing infrastructure for traditional applications while standing up a different set of infrastructure and tools for the new cloud native applications.
HPE’s point of view on this is that this is not sustainable. And the CIOs that I’m talking to see that this is not sustainable to have two different sets of infrastructure, one designed for their traditional apps and the second designed for the new cloud-native apps which will require to deliver continuous DevOps to production of applications. HPE’s vision is to pull both of these together and produce one infrastructure that can deliver all the applications today while enabling the agility and fluidity of infrastructure that customers are seeing today in the cloud but on premise. KEY TAKEAWAYS: Discuss the key challenge we’re hearing loud and clear that our customers are facing - bridging from traditional to the new style of business. They require the ability to do both. IT must be flexible to meet applications needs instantly. Traditional: Customers find themselves with two modes of business that need to be addressed by IT and there’s nothing out there that allows them to do that with a single solution. From a tradition standpoint, we’re delivering technology solutions that are stable and allow customers to roll out applications and services in a very planned, longer term time frame. Support the business: Databases, OLTP, VMs (invisible) New Style of Business : (Digital Enterprise, Digital Economy) I.T. IS the business: Drives revenue/profit (mobile apps: res, bank) With the emersion of cloud and other technologies, a new style of business is required, with more agility to do things more quickly to better drive more profitability into their organization agility Our customers want to be relevant to and succeed at both Our goal is to help them on the journey and to succeed at both Discuss the key challenge in bridging from traditional to the new style: Bi-Modal To help bridge, it would be great if one infrastructure could do both To do that it would need to be able to flexibly change personalities 1) Reliable, low cost, secure 2) Agile, flexible, and fluid Can’t be static, must take on different personas dynamically Must be able to flex to what the application needs, not overprovision We call it “Composable Infrastructure”! There are fundamental differences in the tools and technologies required to run “traditional” and New Style of Business application workloads. To meet both the different needs, companies are investing in two separate environments, which increases costs and complexity. Gartner calls this Bi-Modal computing API proliferation, for example, with different or no APIs in traditional IT. And different API’s in new style of business. We see a new class of infrastructure is needs which can Increase IT Efficiencies for Traditional Apps and enable Continuous Services Delvers for the New Style of Business
The market continues to change at a tremendous pace. Instability is the norm. You need to harness today‘s megatrends to build more value for their business and customers.
One effect this is also driving is in re-shaping the role of the CIO, where he or she has traditionally been a builder and deliverer of IT. They now need to balance many of the challenges in adding more value we can see on slide....through multiple IT Delivery Models (HP calls this Hybrid IT), where the CIO now becomes an IT Broker and an Integrator, as well as an IT Builder to enable the various models to work together, to deliver better speed, scalability, security, and cost, thus enabling more innovation in the business.
This new CIO role is more effectively achieved when CIOs have partners who can play across today‘s new delivery models (that make up Hybrid IT), so you can implement the best suited models for their needs and integrate solutions effectively...ultimately to improve competitive advantage.
Customer example: One customer who needed this blend of IT is Renault cars. Renault required a reliable and flexible IT solution to support the development of Electric Cars, Lithium Ion batteries, and advanced telematics services (the car tells you were the nearest location is to get your battery charged/repaired). Renault engaged HP to build and host its European IT Inflrastructure and manage its technical applications in a Highly Secure T3 DC in Grenoble France. The implementation involved delivering a Hybrid mix of Traditional and Utility Services-based applications that deliver business outcomes in terms of getting Renaults new business-critical applications into production faster and at reduced cost. Also the pay-as-you-go financial model reduces CAPEX and ensures predictable ongoing costs and flexibility in line with business growth.
Here are optimum scenarios when HPE Flexible Capacity might well be the right solution for you.
When large capital outlays and long procurement cycles no longer fit your business – when you want to pay for what you use When your data and workloads must stay on-premises, under your control For workloads that could expand to public cloud – under the right controls and for the right workloads When you need better than “best effort” SLAs
HP Flexible Capacity offers smooth and cost-effective capacity growth – With the headroom for peak processing periods such as quarter or year-end processing. Our concept gives you a detailed view of the expenses associated with your IT infrastructure, allowing you to achieve IT flexibility at reduced costs. With a cost model that makes sense, you can deliver true agility.
Flexible capacity, as quick as it gets Increase or decrease capacity, quickly and easily. You can acquire new capacity quickly because you’ll have an incremental buffer available on site at all times. This buffer can be replenished through our service agreement without the need to initiate a full procurement cycle. HP absorbs a significant share of your business risk by installing capacity ahead of the demand. We continually enhance the existing capacity, enabling sufficient standby capacity. Whatever your loads are, we can provide the resources you need, when you need it. When you no longer have use for the additional capacity, you don’t have to pay for it. You can just turn it off until you need it again.
Good fit Customer needs on-premise capacity solution (Security, Compliance, Performance, Control) Customer needs to speed up procurement processes to deploy more capacity faster Customer needs an operational expense solution, wants to move away from capital expense Customer has limited IT budget, making capital investments difficult Customer wants to align infrastructure costs with usage (Cash in with Cash out) Customer has difficulty predicting capacity requirements leading to performance or outage issues Customer needs ability to control and monitor infrastructure utilization (cost control and charge back to depts) Customer values benefits of the HP Datacenter Care services portolio, which is required to be sold with all FCS deals (typically > 50% pen rate) Poor fit Have not identified the business problem the customer is trying to solve with FCS. Customers looking for a cheaper alternatives to other purchasing methods FCS is not positioned as a “cheaper way to purchase capacity” or as a way for HP to “take on most of the utilization risk”. Low Services content FCS should not be positioned to add small incremental buffer to cover demand spikes or product outages No or low forecasted growth No minimum capacity commitment (Public Cloud) Customers needing flexibility of 50% or more in their capacity usage.
We can sum that up in one statement: Datacenter Care is an HP service. And what does that mean to you? It means expertise from a world leader in data center technologies and best practices, along with the rich capabilities of our many partners, is available to you as you seek to fine-tune your IT operations. HP delivers Datacenter Care with unmatched reach and presence—available globally, in 180 countries and many languages. Through our internal knowledge base, you are able to benefit from learnings and best practices from more than 2000 Datacenter Care customers like you.
HP is investing to bring you significant advantages. When you connect to HP, we go to work for you, with analytics, industry-leading tools, and intellectual property, aimed automated diagnosis & prevention of issues, and providing advice for you to build operational excellence.
Your assigned account team is backed by an award-winning parts supply chain, our market-leading HP products and product engineering, and one of the largest ecosystems of alliance partners in the industry.
Investigate other options in the marketplace and it is clear that unlike other partners, we support the entire IT environment with unparalleled flexibility and —without requiring you to maintain separate contracts with each different vendor. What’s more, our connected, proactive approach to account support adds no additional cost to your support agreement but delivers tangible savings and risk reduction.
With Flexible Capacity, you avoid over provisioning and always maintain a safe buffer of capacity ahead of demand, which is monitored and replenished when you need the additional capacity.
Not only does Flexible Capacity help the customer avoid the over-provisioning and wasted profits, but HP shares the risk of underutilization with the customer, as the buffer is deployed at HP’s risk.
Here, you’ll note that the capacity deployed ahead of demand with Flexible Capacity, represented by the black line, immediately eliminates the waste of over-provisioning (shown in blue color), provides a sufficient buffer to ensure outages are avoided (the red color), is replenished as often as necessary based on our monitoring information, and still only charges the customer based on their actual usage, represented here by the red curved line, not the amount of capacity deployed by Flexible Capacity represented by the black line. So the customer’s benefit is that his billing is exactly matched to their usage in every billing period, as the buffer capacity represented between the black and red lines is deployed as Capacity ahead of demand at HP’s risk, not yours.
New with this release of Flexible Capacity are
Integration with certain Microsoft Azure services More flexibility for ways to price and measure virtual machines Ability to include Helion OpenStack products Support for HPE Software defined storage products
HP Flexible Capacity (FC), a component of Datacenter Care, announces the third major version.
Expansion of Flexible Capacity to include pricing per VM. Today we extend the benefits of FC for on premise IT – pay per use, instant scalability, with enterprise quality support – to include the ability to meter and price usage by Virtual Machine.
Extension of the resources that Flexible Capacity provides to the hybrid cloud. With this innovation, Flexible Capacity customers can use resources in HP’s Helion Public Cloud in addition to the current ability to use servers, storage, networking and software that is on premises.
Customers can extend the enterprise-quality support that they get with Flexible Capacity to the hybrid cloud resources, using HP Hybrid Support
An innovative offer from HP Technology Services, Flexible Capacity delivers a public cloud experience with the benefits of public and/or on-premises IT. Our customers are able to use FC so that their capacity never runs out. With this pay-as-you-go solution, customers can scale instantly to handle growth needs without the usual wait for the procurement process, and without tying up capital. With this announcement Flexible Capacity is hybrid IT - ready.
Consider this customer scenario to see the value of Flexible Capacity at work.
HPE Flexible Capacity = Greater agility and confidence for you.
Because with Flexible Capacity:
Cash - You pay for what you use – servers, storage, networking and software support in today’s converged systems, reducing your spending and aligning to usage Capacity - You gain fast flexibility – that scales when you need it Confidence - You can count on enterprise-quality support – in your data center or in your hybrid IT environment Control – on premises when you need to– or in the Helion Public Cloud, giving you the right options to suit each workload
Hpe flexible capacity vikram yerram
Private Cloud Benefits with
the Economics of Public
Cloud: A win-win situation
for CIOs & CFOs
Vikram Kumar Yerram
Country Manager – Technology Services Support
26th February, 2016
New Style of Business
HPE Flex Capacity Offering
Time Value of Money
ANSWER: Compound Interest
20 year old Britney makes a one-time $5,000 contribution to a
retirement fund that grows at 8% per annum
If she never touches it until she retires at 65, how much will she
If she waited until she was 39 to make her one-time $5,000
contribution, how much would it grow to?
‘A Dollar today is worth more than a Dollar tomorrow’
Compound interest is an example of growth that we all understand
Albert Einstein was once asked what is the most powerful force on
Earth… What was his answer?
Taxi-hailing apps like Uber, Ola could eat into auto
Anand Mahindra has warned the auto
industry against rising competition from
taxi-hailing apps such as Uber and Ola,
saying it could push some people into
giving up on ownership of cars and pose a
threat to auto industry volumes.
"The age of access is here. There is going
to be increasing number of people who
would want access to transportation and
not own object of transportation. So what
are the opportunities?"
Time to Value is enemy #1
Leading enterprises will be able to alter their digital DNA continuously
Your IT is now central to the success of
your business, but we are all being
asked to cut costs.
Imagine having a total IT solution that
enables you to reduce cost, pay for
what you consume and measure that
cost for your business, for your
Your IT is enabling your business to
change, to stay ahead of it’s
competitors. But change brings risk.
Risk to the business, risk to
procurement, risk to your IT
A solution that gave you access to the
latest technologies, always access to
enough capacity, and that delivered
enterprise-grade support…where the
solution simply works?
Time to Value
Time moves quickly, and so does your
business. It has to adapt fast, and be
agile in the market. Time to value
Imagine being able to scale up your
capacity to meet those changes in
minutes, not months, but only pay for
what you actually consume.
Time to Market
In the Idea Economy, IT is the business partner for value creation
IT must now be able to support two operating environments
− Ops Driven
− Cost Focused
− Apps Driven
Technology Services to help customers today and bridge into the future
Buy & Build
Lease & Use
Consume and Pay-per-Use
How should I pay for them?
(‘How to Buy’ = financing
What assets should I acquire?
(‘What to Buy’ = investing decision)
A dilemma for IT leaders
“I want a public cloud experience,1 with the benefits of on-premises IT”2
from the cloud
• Rapid Scalability
• Pay per use
• No up-front capital
• Use a service, not manage IT
• Less control
• Not managing Security,
• Latency issues
• Data sovereignty issues
• Choose your server, storage,
• Manage your datacenter
• Control security, compliance
• Invest capital
• Overprovision to handle
• Manage months-long
Traditional IT Public cloud
1 Ease of start-up, several pricing models, OPEX treatment, flexible usage for Compute, storage, and networking
2 Control, security, legacy workloads, lower latency, data location, enterprise-grade SLA from HP Technology Services
There is an alternative: HPE Flexible Capacity
– When large capital outlays and long procurement
cycles no longer fit your business; when you want to
pay for what you use
– When you need the IT capacity ready for surges in
– For your data and workloads that should stay on-
premises, under your control
– For workloads that could expand to the public cloud
– When you need better than “best effort” SLAs
Pay only for
what you use
No upfront fee. Single monthly invoice.
What makes HPE Flex Capacity the right service for a Customer?
• Clear business need for a client managed / on premise
• Lengthy procurement process
• Rapid growth, but, unpredictable month to month
• Need to align IT costs with usage and / or revenues
• Customer IT team can provide day-to-day management
• Customer has a lot of overcapacity and wants to move it
into FCS (Hybrid Model)
• Customer believes flexibility is cheaper per unit of computing
• Low forecasted growth
• Customer wants to retain control of detailed technology choices
• Unclear future IT / Business strategy
How is HPE Flexible Capacity unique?
…a public cloud experience with the beneﬁts of on-premises IT
Unlike a Public Cloud
On premises, with control
over privacy, compliance,
latency, and security;
choose your technology
Unlike other “utility”
Include your whole IT
estate- server, storage,
networks, software; not
tied to one vendor
Unlike a product lease
Variable payments based on
actual metered usage; flexible
technology refresh; payments
vary up or down; easy change
Risk mitigation with a pay-for-actual-usage model*
How Flexible Capacity works
• Avoid lost profits due to CAPEX
purchase over provisioning
• Maintain a safe buffer of
capacity: 10 percent to 40
percent depending on need
• Monitor and replenish as
needed: “Capacity ahead of
• Pay only for actual capacity
used* (purple dotted line) not
deployed (black line)
• Facilitate cloud migration
Traditional purchases (CAPEX)
Compute needed and invoiced
Minimum commitment level
* Subject to a minimum commitment
HPE Flexible Capacity options
From Upfront Investment ahead of Revenue to Consuming Infrastructure as a Service: pay
only for the servers, storage, networking capacity, software licenses, support, and services you
actually need and use each month
Monthly Payment Includes1
– 3rd Party
Variable usage = variable payment
– Financially, operating at 100% utilization
– No upfront costs & no budget surge when you
are at capacity
– Business cost aligns with business demands
1 Minimums apply below certain usage levels
– Software defined Storage /
– Flexible VM metering, monitoring,
– Helion OpenStack products
– Certain Microsoft Azure svcs
– Servers Per blade or VM
– Storage Per GB
– Network Per Port
– Converged Systems for SAP Hana
– HPE Software And SaaS
– Support Service Provider’s environment
– Microsoft, VMWare, Red Hat operating environments
– Microsoft Azure Per VM
– HPE Helion OpenStack
TIME VALUE OF MONEY
Capex Vs Flexible Capacity -> Over-Provisioning –> 0 - 30% lesser cash deployed monthly due to
Pay-per-Use in FC (80% minimum commit level)
1 2 3 4
1 2 3 4
Cost of Cash over time: Capex Vs FC -> FC Cheaper by 38-40%
Capex vs FC (Currency: INR) Y1 Y2 Y3 Y4 Cumulative Cash
Cost of Funds deployed 8% 8% 8% 8%
Cumulative Cash Deployed in Capex 20,08,42,041 23,55,16,908 27,62,56,587 32,30,64,075 32,30,64,075
Cost of Cash Deployed in Capex 1,60,67,363 1,88,41,353 2,21,00,527 2,58,45,126 8,28,54,369
Cumulative Cash Deployed in FC Model 4,92,98,375 11,45,13,865 18,64,15,770 26,69,90,430 26,69,90,430
Cost of Cash Deployed in FC Model 3,94,3870 91,61,109 1,49,13,262 2,13,59,234 4,93,77,475
FC Includes a Rolling window with Technology Refresh
Assuming ‘useful life’ of datacentre equipment is 4 years:
• All HW/SW
installed in Year 1
is refreshed in
• For HW/SW
installed in year 2,
refresh is done in
• For HW/SW
installed in year 3,
refresh is done in
• For HW/SW
installed in year 4,
refresh is done in
As Hybrid becomes the fabric of IT
Hybrid-Ready IT with HPE Flexible Capacity
• HP Flexible Capacity: Pay-as-
• New metering and payment
per virtual machine
• New expansion to HP Helion
• Hybrid IT must be seamless –
One pool of capacity
• IT-as-broker – Some
workloads can use public
cloud, some stay on premises
• Enterprise quality support
required for all Hybrid IT
• Increase agility – Ready on
demand to match business
• Flexibility – Provision for
immediate needs in minutes,
• Hybrid Support enables the
support as in the data center
Features Problems it solves Customer benefits
Flexible Capacity End to End Process
Process repeats with
invoicing and data
sent to customer
on FC portal
Metering and data
collection enabled and data
What do customers say about
Example: Predictable cost & high-performance Storage infrastructure
Large Multi-National Telecom Equipment Manufacturer with more than 33,000
active patents, 8 Nobel Prizes shared by 14 Bell Labs researchers
From cash flow and budget perspective - they needed a complex and cost-effective solution (paying for
what they use) tailored to their technical requirements so they could easily invest in their own IT projects
From the infrastructure perspective - they had to de-risk critical business related infrastructure by reducing
heterogeneous and legacy platforms and move to new future-state infrastructure.
From usage perspective - because the storage was growing dramatically their capacity required an instant
They required from their future vendor: zero impact of change, guaranteed continuous IT-operations,
OPEX model for capacity ramp-up and pay-as-you consume model ensuring business and cash flow stability.
- Deferred Cash expenditure
- Optimization of schedule for future state platforms
- Reduction in overall infrastructure spend
- Refresh plans executed well in advance of EOSL
- Key financial KPIs achieved for both savings and cash protection
- Reduction in run-rate costs
- Additional storage as a back-up environment for data center in India
- Monthly invoices for current customer's use of capacity and storage
HPE Flexible Capacity: Agility and confidence
– Zero up-front capital—
utility based billing
– Optimized to usage—
– Pay per use*, match
cash flows to usage
Pay for what you use*
– Improve operational
– Build IT stability
– Elastic—provision more
capacity in minutes, not
– Unlimited—refreshed as
it is used
On premises when you
– Legacy workloads
* Subject to minimum capacity commitment
Many customer videos are available on Youtube. Go to Youtube.com and search for
“HPE Flexible Capacity”