Google Cloud stuff

A brief overview:

The expansion centers around Google’s new open-source hybrid cloud package called Anthos, which was introduced at the company’s Google Next event this week. Anthos is based on – and supplants – the company’s existing Google Cloud Service beta. Anthos will let customers run applications, unmodified, on existing on-premises hardware or in the public cloud and will be available on Google Cloud Platform (GCP) with Google Kubernetes Engine (GKE), and in data centers with GKE On-Prem, the company says. Anthos will also let customers for the first time manage workloads running on third-party clouds such as AWS and Azure from the Google platform without requiring administrators and developers to learn different environments and APIs, Google said. 

And from an interview with Kurian:

So for us to grow, the primary thing is to scale our go-to-market organization. And we’re very committed to doing that. We just need to hire and train and enable a world class sales team at scale.

Today we have a great sales team, but we are far fewer in number than the other players. We just need to expand that. And as I talked to customers, they asked us to, one: expand our sales organization and our go-to-market teams. Second: specialize (that sales team) with deep expertise in technology and in industry. And third: make it easy to contract and do business with us. We are extremely committed to doing all three of them.

Also, from the product bucket:

Google also announced Anthos Migrate, a beta service that automatically moves virtual machines running on on-premises or other cloud providers into containers on GKE. Assuming it works, that’s a much easier path to the cloud for companies worried about breaking mission-critical applications during the move.

And, a good round up of analyst Tweets.

Every cloud providers, every tech vendor, wants to go up the stack, close to The Business where there’s more money to be had:

During his keynote, Kurian referred to Google Cloud as a “digital transformation provider” – he didn’t say an ‘IaaS alternative to AWS and Azure’. In fact, Google Cloud is open to the fact that enterprises may use multiple IaaS providers (more on that later). Kurian is clearly making a play for Google Cloud to become an enterprise technology vendor that has deep skin in the game with customers, focused on meaningful outcomes, rather than just a pay per usage alternative to other IaaS vendors.

They’re trying a more open source company friendly approach, adding in some popular databases as a service:

Initial technologies include those from open source database system providers Confluent, MongoDB, Elastic, Neo4j, Redis Labs, InfluxData and DataStax.

Also, see the very well written Anthos documentation.

Speed, Accuracy, and Flexibility, IBM circa 1920

The purpose of a sales force is to bring a company’s value proposition—its “deal”—to customers. That value proposition results in the development of a company’s “go-to-market” strategy, how it will implement that plan. Central to that activity can be a direct sales force, people who meet face-to-face with customers, a typical approach with complex and expensive equipment. For simple products, a catalog or store can suffice, and today even a simple website will do. In 1914, ITR’s and Hollerith’s products were complicated, and so one had to make a clear case about why customers should buy them.

There was considerable consistency across the decades about IBM’s value proposition. Watson explained to a new batch of executives that, “We are furnishing merchants, manufacturers and other businessmen with highly efficient machines which save them money.” For the larger IBM community, he followed with, “That is why we are going to make more money for this business.” He spoke about how IBM created value. By 1920, Watson was preaching that the way to accomplish C-T-R’s goals was “to serve better industry’s vital requirements—the need to conserve time, motions and money.” He introduced a signature for IBM sales literature, too, that delivered a sound-bite value proposition used for decades: “Speed, Accuracy, and Flexibility.”

From IBM: The Rise and Fall and Reinvention of a Global Icon.

Link: Google’s new cloud chief has a culture clash ahead of him after 22 years at Oracle

But when it comes to the big storage and core computing contracts, numerous industry experts, venture capitalists and tech executives alike told CNBC that Google’s sales team is ineffective, preferring to sell what it thinks is best rather than what customers say they need.

“You don’t get paid to be right, you get paid to sell what the customer wants to buy,” said Mackey Craven, a partner at venture firm OpenView Venture Partners in Boston who focuses on enterprise start-ups.
Original source: Google’s new cloud chief has a culture clash ahead of him after 22 years at Oracle

Shifting IT spending drives sales-force changes – Notebook

Looking at how company’s arrange their sales (and marketing) organizations is an interesting view into the effect of “cloud” on how IT is used and consumed. This week Microsoft is re-arranging it’s sales force to make it more cloud-friendly, people say.

From what I can tell with my dilettante analyst, Microsoft’s theory appears to be that:

  • sales people need to be more technically savvy on cloud,
  • have more vertical knowledge (how does cloud apply to my industry?), and,
  • target larger accounts (where the top and bottom line revenue is worth having a big sales venture, and to bring in volume and cash to public cloud).

Also, with 75% being outside of the US, it’s a dramatic change internationally.

Here’s some excerpts from coverage:

Summarized by Nicole Henderson:

The company said it is implementing the changes not to cut costs, but to improve how it handles sales; specifically, it said it will use employees who are more knowledgeable about specific verticals so they can sell bigger packages, CNBC reports.

As Microsoft vies for more enterprise cloud clients, having better trained salespeople, who are knowledgeable about a specific vertical, will mean they are better equipped to meet client needs. To that end, Microsoft said in an internal memo that it would split commercial sales into two segments – one targeting the biggest customers and one on small and medium clients. In addition, Microsoft employees will be aligned around six industry verticals – manufacturing, financial services, retail, health, education and government.

See also coverage from CNBC, and The Register’s coverage, e.g.:

With recent changes to its enterprise agreement to exclude smaller companies, Microsoft is focusing on bigger deals that require fewer staff, while everyone else gets shifted onto a per-person consumption payment model for Microsoft’s cloudy services.

We also discussed this briefly in this week’s Pivotal Conversations.

Shifting spending

Meanwhile, while this doesn’t capture all of the market-shift (you’d also want to see the shift from COTS to SaaS, infrastructure software, and then *aaS spend), some recent charting from IDC shows one of the motivations for changing up your sales approach, i.e., IT infrastructure (hardware) money is shifting around to public and private cloud stacks:

In the above, you see the blue bar slowly decreasing in the out-years meaning less “traditional” spend and more “cloud” spend. The pricing dynamics and units shipping in public cloud are all whack compared to private cloud (Google, Amazon, and Azure’s hardware needs are much different than private cloud needs), but looking at the red bar gives you an interesting perspective on new build out at enterprises. And, thus, you can get a sense for shifting buyer behaviors in IT…and why you’d want to re-arrange how you sell to them. See more recent details from IDC.

Link

“It was just dumb”

This a good parable on what can go wrong in large organizations when incentives are not working as planned.:

But the reality seems to be messier and more boring: Wells Fargo wanted its employees to push lots of real accounts, it asked too much of them, and the employees rebelled by opening fake accounts to get the bosses off their backs. The fake accounts weren’t profitable for Wells Fargo, and no rational executive would have wanted them, which is why Wells Fargo kept telling the employees not to open them. But the employees did anyway because they felt like they had no other choice. It was not an evil high-level plot. It was just dumb. It was a form of employee resistance that was channeled into fraud by bad incentives and bad management. There is a limit on how many times you can ask a guy in a hearing “this thing you did was pretty dumb, wasn’t it?” Though look for the Senate Banking Committee to test that limit.

Knowing very little about the details, back in IT-land problems like this usually mean the culture needs some tweaking.

Check out some more commentary.

Amazon Prime Day is biggest day for online retailer ever

The online retailer said worldwide orders rose more than 60 percent compared with the previous Prime Day.

Looks like things worked out well.

Some of the more popular “deals”

Source: Amazon Prime Day is biggest day for online retailer ever, sourced from my wife!

The new software sales model?

From Gavin Clarke’s piece on Microsoft’s head of sales leaving:

But the sales model had changed; it was becoming less about shipping more boxes at fat margins and more about persuading people they should download your service, buy on a subscription, pay for what you use.

The world of Nadella and the current reality of Microsoft couldn’t be more removed from the world of Turner. Today it’s a more complicated sell: on-premises remains the core of Microsoft’s income – desktop and server – but Microsoft is desperately trying to grow its cloud and data businesses. Neither involves destroying the competition; rather, it’s a more nuanced sale, a sale you don’t win by simply trashing the rivals.

The notion that enterprise tech sales have gone beyond zero-sum is tantalizing, but hard to imagine. Let’s hope so.

Also, the quotes from sales meeting keynotes are so, so sales-y that it’s almost “ugh” feeling.

Link: Wanted: 1,400 sales jockeys to flog Oracle Cloud

Ramping up cloud: “Oracle talks a great cloud game – it says it has in the last six months added nearly 1,500 new software as a service (SaaS) customers and more than 2,100 platform as a service (PaaS) customers.”

Source: Wanted: 1,400 sales jockeys to flog Oracle Cloud

Freemium Mechanics from Jeff Nolan

Ultimately the freemium model is a strategy that increases the catchment of leads as a result of using your product as the primary marketing vehicle through which you deliver a funnel to. Take care to structure your website so that every aspect of the content you are creating is designed to deliver a site visitor into a product experience or isolate them for followup through a traditional enterprise sales process.

For me the mechanics of a freemium business are some of the most interesting to be involved with in a modern software as a service company. The implications of billing and provisioning system dynamics, how you structure your website content, surface funnel analytics, build upselling cues into your application, and manage high volume sales nurturing processes are incredibly complex but increasingly normal for the B2C and even B2B markets.

–Freemium Mechanics | Jeff Nolan – Venture Chronicles.