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Meg Whitman tells IT leaders everything they need to know about HP Enterprise

John Gallant | April 7, 2016
In this installment of the IDG CEO Interview Series, we asked Whitman to talk directly to IT leaders about what the company split means for them as customers, and how HP Enterprise's new innovation agenda will help them transition to private and hybrid cloud.

Clearly, there'll be a period of transition as those companies go through a lot of changes if that deal goes through. But why do you think they're banking on the old? What indication do you have of that?

Well, think about what's going to happen here. They are doing a private equity play. When you get bigger, when the market consolidates, what are you actually trying to do? You're trying to rip out cost and you're trying to rip out duplicate cost as well as cost costs. Just think about the R&D spend there.

The cost of the Dell/EMC debt is going to be much higher than they had originally thought because the debt markets have moved. It'll be probably in the $2.7 to $5 billion annual range. The entire budget for R&D at EMC is $2.7 billion. So there's going to be some impact in my view on R&D.

And then there's going to be, to your point, a lot of figuring out who's on first at what customers, go-to-market rationalization. Talk about losing your favorite sales rep. By definition, half the people are going to lose their favorite sales rep. I think from a financial architecture perspective, this could be quite powerful in the long run, but I think it's going to be a challenge.

We've got to stay focused on innovation, on customer needs, on presales, on architects, on these four transformation areas, while Dell/EMC is restructuring themselves. I think there's at least a two- to three-year opportunity where we have a chance to really show our world-class innovation and the ability to help customers migrate to a better place for them.

So let's talk about that opportunity. How will you take advantage of that from a strategic perspective? I've seen your advertising saying don't let your business be put on pause by Dell/EMC. What are you telling those customers and how will you capture the hearts and minds of those Dell/EMC customers?

There's really a two-prong approach there. One is to make sure that all the Dell/EMC VARs know that they are most welcome at Hewlett-Packard, so we are reaching out to Dell/EMC VARs who are nervous, because VARs make their living with these companies. I know this personally, because when I got here all of our VARs were nervous. So I recognize nervous VARs.

We're talking about our roadmap for innovation, our ability to sell with them, our ability to hunt new accounts for them. And this was the play we ran in many ways when IBM sold their server business to Lenovo. We're actually doing that exact same play, which was very successful for us.

 

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