Selling the Dell Technologies cutting edge in Canada

While Canadian customers have a generally accurate reputation for being late technology adopters, Dell EMC execs at last week's Toronto forum said that they are seeing movement towards newer Dell Technologies offerings.

Kevin Connolly (L) and Michael Sharun (R) on stage Thursday

TORONTO – Last week’s back-to-back Dell EMC events here – the Dell EMC Canada Partner Summit on Wednesday and the Dell EMC Forum customer event on Thursday – gave customers an overview of Dell Technologies’ digital transformation strategy, and where Dell EMC’s converged and hyper-converged offerings fit in. Both customers and partners were informed of the company’s momentum in these areas as well as the more traditional parts of their business. Dell EMC also emphasized to partners the importance of selling more broadly across the portfolio, attaching additional lines of business. While the staple solutions still make up the vast majority of the Dell Technologies Canadian business, newer technologies are beginning to make headway – despite the traditional slower adoption of new technologies in Canada.

“There is a lot of confusion in the market,” said Michael Sharun, President of Dell EMC Canada’s Enterprise Division. “Customers are confused about what they need to do. A few years ago, cloud was the answer to everything. Customers are now not sure how to move forward. They are looking for trusted advisors more than ever.”

Kevin Connolly, a long-time EMC exec who came to Canada in July to assume the role as Sharun’s opposite number as Dell EMC Canada Commercial head, also noted the customer uncertainty in dealing with the changes being wrought by digital transformation.

“Canadian customers have the same problems as customers in the U.S.,” he said. “Organizationally, IT departments aren’t always aligned with what the organizations are trying to do. They try and build things rather than buy things – because that’s what IT was. But it’s not about IT building things any more. There is always a lot of resistance to change, no matter what business you are in. But as far as ‘buy versus build’ goes, it’s just a matter of time before everything is ‘buy.’ There will still be legacy-built IT to support, but everything new will be ‘buy.’”

Connolly indicated that the vast majority of the Commercial business in Canada remains the traditional Dell EMC offerings

Kevin Connolly, Dell EMC Canada Commercial leader

“We are focused on four core solution areas in Commercial,” he said. “The client business is our bread and butter in Canada – lets face it,” he said. “Then comes the infrastructure business, the EMC legacy solutions. The latter two are VMware and the 14G server business. They all tie together. While I don’t have a formal joint go-to-market with all the Dell Technologies business units, I do liaise with [VMware Canada head] Sean Forkan weekly.”

Sharun indicated that the traditional products are still the bulk of the Enterprise business as well, with the main shift being that Dell EMC is having some success in increasing their cross-selling and attach rates on other solutions.

“I think the main thing that’s ahead of us is getting our customers relying on more Dell Technologies products and services in their organization,” he said. “If a typical customer used to buy three things from us a year ago, they might buy four or five from us today. But we are nowhere near done our relevance here.”

Connolly said he is seeing the same pattern on the Commercial side.

“I’m seeing a willingness among to expand their offers, especially around 14G,” he said. “They can sell something from a niche player once for $50,000 and achieve a tactical outcome, but selling a broad Dell EMC solution set instead will get them more mindshare with the client in the long run.”

Hyper-converged offerings are still relatively new in the Dell EMC portfolio, and their sales numbers have begun to hit the exponential stage of growth

“We have 60 VXRail customers in Canada today,” Connolly said. “I’m going to 900 in two and a half years.”

Deanna Thomson, Dell EMC Canada’s channel chief said that while hyper-converged infrastructure is a newer technology, it is a logical continuation of what many partners were doing before.

Deanna Thomson, Dell EMC Canada’s channel chief

“Many old Dell partners are concentrating on HCI because the leap to HCI is not a big leap,” she said. “That ease of transition is why we are now seeing the hypergrowth of HCI in the marketplace.”

Dell has been selling PCs-as-a-Service for some time, but the offer was only formally made public in May at Dell EMC World, and was enhanced last week. A show of hands at the Partner keynote on Wednesday indicated that extremely few Canadian partners are playing in that space today, but Connolly said that significant sales are starting to come.

“We have a huge commercial client investing in PCaaS, and rolling it out at a significant rate,” he said.

The Pivotal Cloud Foundry and its cloud-native application development capability has picked up significant momentum in the U.S. When Dell EMC converged platforms head Chad Sakac asked the customer audience how many of them were using Pivotal today, hardly any hands went up – albeit, it should be noted, in an audience heavily weighted towards people responsible for infrastructure rather than applications. Connolly said that he is seeing signs of Pivotal adoption picking up in Canada.

“Canada is a little behind on Pivotal and agile development,” he said. “We do have some Canadian references – but they aren’t public yet.  It’s not just for big companies. When I was in the U.S., I had a credit union customer in Chicago that was working with it. All you need is to have a CIO committed to changing the company. That’s all that matters – not size but a commitment to being mobile and changing the way they develop. While today it is largely it is in the enterprise, it is coming downmarket, and will serve the midmarket business. That’s dependent on us being able to tell the story that identifies what Pivotal does for customers.”

Dell Technologies is a relative newcomer to the Internet of Things market compared to companies like Cisco and Hitachi who have been in it since well before the IoT monicker was coined. Dell moved into the space in 2015, and deepened their investment earlier this month when they set up a new organization to improve co-ordination between the Dell companies, along with providing enhanced funding. Both the Enterprise and Commercial Divisions in Canada are working in IoT. Partners and their specialized expertise are critical here, and Sharun said that in Canada Dell EMC is having success in enlisting the most desirable ones.

Michael Sharun, Dell EMC Canada Enterprise leader

“Most of the speciality organizations that do IoT are already doing business with us already,” he said. “It’s up to us to change the way they view Dell Technologies and make us a player in that space. Networking and communications have cornered that market in the past, but that’s changing. I think we have most of these partners in Canada now, and we will also see new startups emerge who will be focused on this.”

“There will be companies that don’t exist today that will build their business around IoT, and we will see significant disruptors in this in Canada,” Thomson said. “There are business models that don’t exist yet that will be developed around IoT, and we expect to see both traditional models and new models being adopted. Folks that have built their businesses in the cloud will be in the lead here.”

As a newcomer to Canada, Connolly summed up his impressions of Canadian response to the new Dell Technologies offerings.

“I do think the late adopter thing is a reality compared to the U.S.,” he said. “But it’s mixed. Some customers are behind, but there are also forward-looking ones, who have been investing in things like [VMware] NSX. I don’t think that the issue is a negative for us. It means that there is a real opportunity here.”