>> Announcer: Live from Las Vegas, it's theCUBE, covering InterConnect 2017, brought to you by IBM. >> Welcome back to InterConnect 2017 in Las Vegas. We're here at the Mandalay Bay hotel. This place is packed. We're right by the escalators, jamming all day, roughly 20,000 people here. Mohammed Farooq is with me. He's the GM of the cloud brokerage services under the GTS division of IBM. Mohammed, thanks very much for coming on theCUBE. >> Thank you very much, I appreciate for having me here. >> You're welcome. We were talking, having a great conversation off camera about your history, coming over from India, getting an education in Oklahoma, doing startups, selling companies and ultimately ending up at IBM. Let's start where you are today. Your role as GM of brokerage, cloud brokerage services. What does that entail? What does that mean, cloud brokerage services? >> Two things here, right? My role at IBM is one part of the question and what is cloud brokerage is the second part. I'll start with cloud brokerage. Cloud brokerage is the concept that has emerged in the last five years where as cloud services became one of the choices for consuming IT, the role of enterprise IT had to change from being a manager of technology to brokering what services businesses use either from internal IT or from external cloud providers. The CIOs and ITO organization had to take on the role of a broker. To play, effectively to play the role of IT broker, you need to really change the current IT model, which is people process technology. That had to be automated into a new platform that gave birth to the new requirement that you need a broker via technology in a platform where you can connect demand to supply. Demand can come from any business unit, either for infrastructure or applications or managed services, and you can connect it to the right supplier, just like manufacturing, just in time. The CIO would optimize the demand and supply and make sure the right services are available to be pulled at the right time for the right user. This is what Amazon has done. This is was Azure is doing. This is what SoftLayer has done. Give access to IT services on demand. But can you aggregate that and provide a standard consumption operating model for the enterprise? That is the new broker role and the broker's platform from IBM basically enables that role for the enterprise. >> Is that software? Is that an abstraction layer, a manger of managers, or is it people in process? >> It is both. It is an abstraction layer that connects to all cloud providers, internal or external. It has automated new processors for consumption, service management and governance, and it creates new roles in the enterprise for IT organizations and business users. It's a complete rethink of how IT operates, but importantly, it connects to the current processors. That's where you can run hybrid IT. You can connect to service now, to the current i2 processors in the enterprise. You can connect to the current governance dashboards and you can connect to the current data centers. We do have current applications on. It connects to the current and it connects to the new world of automated self-service and brings it together. >> So, you go back 20, 25 years, this business that you're in now was a break-fix business. It's totally transformed. Talk about the CIO. What's on his or her mind today? What should they be focused on? >> I think the CIO's role changes every two to three years. The areas of focus changes. Previously, they were in the business of building applications and managing it and managing the infrastructure. Then the packaged applications came, SAP Oracle. Then they were in the business of implementing. Then they started building web applications again for awhile and managing it. Now we have SAS, software as a service, so you can just rent an application. You have a pass. You don't have to build a bigger web. You can rent it. You have infrastructure, you can rent it. Excuse me. The CIO's role now, the CIO's role now is how do I govern it? That's the priority. I don't have to go build it. I need to govern what I have, but effectively. Second, I need to provide access to services that my business needs, and I need to do that at speed. Third, I need to be able to manage it security wise, compliance wise, whether the data is staying in the right places. It's not being exposed because data breach is a big issue. My infrastructure doesn't have holes for security. It can scale. So the concerns of the CIO are now different. The risks are different and that's a new role the broker is taking on. The most important role for the CIO right now is give me visibility into where my stuff is. It's in Amazon, Azure, SoftLayer. I've lost control of it. Tell me where it is and it's very complex, simplify this for me. >> It's interesting to hear you, Mohammed, talk about the CIO used to develop apps and then commercial, off-the-shelf applications came and then the web apps, they started developing apps again, et cetera, that progression. Now there's SAS. I wonder if I can get your comment on this. The other sort of trend that we see, we talk about it all the time, is that the, the companies talk about digital transformation all the time, part of that digital transformation is becoming SAS companies. Every company's becoming a SAS company. What's the role of a CIO in this new-- I think Benioff said it. There'll be more SAS companies for non-tech companies than tech companies. What's the role of a CIO in that world? >> If you look at it, the differentiation that a corporation has today is the digital experiences it requires either on the supply chain side or it's customers. Those applications are custom SAS applications that they're building. The CIO's role is to make sure it becomes the operator of SAS apps. Right? >> Interviewer: Whether internal-- >> Internal or external. So if his business units develop custom SAS apps, either mobile apps or social media apps or analytics apps, those apps should be available and running and scalable in the cloud 24 seven. Basically, he becomes a SAS operator. When you're a SAS operator, you're also a governor. Industry is calling it hybrid cloud, many clouds, multi-clouds and the role of the CIO is to operate them and make sure they're governed. Third, that it's business get access to the right services at the right time because that time is very critical. The connected stakes of an operator and governor is real-time access to services, continuous innovation and speed, and control. >> This is a huge skilling issue for CIOs. Is it not? The skills transformation, you're going from provisioning LUNs to being a cloud broker. How's that going for your clients and how are you helping? >> That's where IBM comes in. IBM is saying for us to play a role in a digital world we have to change the way our relationship work with our customers. So if the CIO is becoming a broker, then what is my relationship with a cloud broker in the enterprise? As adoption is stating now, in the beginning, there's no skillset in the enterprise to operate this model. IBM has developed the technology and the skills and telling the CIO we can build this and operate it for you. And when you are assured, we can transfer this to you. It's a build, operate, transform relationship that we are building so that the CIOs in Fortune 500 can strategically partner with IBM and take this journey together. The role of a broker will be different in every enterprise, customized to that enterprise based on it's priorities. IBM is basically redefining the experience and the relationship to it's customers. In turn, we are enabling our customers to transform faster, develop value to it's business faster and become digital faster. >> Let's talk about IBM's business GTS specifically. I said off camera and I'll say it again, many people may not realize 60% of IBM's business is still services, combined GTS and the consulting services, about 30% is software, but only about 10% is hardware these days, including the operating systems. It's quite a transformation that Ginni has effected. I certainly remember the days of John Akers when IBM was splitting apart and trying to focus on different parts of the industry and Gertsner said no, single point of contact for the customer, we will become a global service provider, very successful strategy. Now we're entering this cognitive age. What's the strategy, specifically with regard to GTS? Are you trying to codify that deep expertise and put into software, like that abstraction layer we talked about? It is sort of a hybrid model? I wonder if you could summarize. >> Two things. What was true when Lou Gertsner said we want to provide a single point of contact and we're going to put this together, that was systems integration business. We will take all the piece parts for the customer and we will take the responsibility to deliver it reliably and make sure it's available and it's performing. The large corporations will depend on us to run their enterprise IT systems. Fast forward 2017, we are now a service integration business. We are integrating services from cloud providers, either internal or external. We're still playing the same role. We are the single point of consumption and integration and delivery for the new supply chain. The supply chain now is 100 times more fragmented than it was before. >> Interviewer: It's way more complex. >> It's more complex. >> Yeah, this is a huge opportunity. >> This is the biggest opportunity, again, for IBM and we are practically going after that opportunity. Hey, our role is the same. We are the single point of consumption and delivery and governance for our service integration and service delivery. That's how IBM is defining it's role, again, in the services era from a systems era. Second, how does it impact our revenue? We have a massive opportunity, every dollar spent on cloud services, customers have to spend money on managing it, integrating it, operating it and enhancing it. We are building offerings that provide value on top of the cloud providers in all these areas and we manage it. We see significant revenue opportunities. The way you distributed the revenue structure of IBM, we see a 10x opportunity for us doing that. >> Well, so there was a while where people thought that, that to the extent that you could automate, it would eat into the services business. That's not happening you're saying. >> Right, so two things are happening, right? That is happening, but we see a tremendous opportunity there for IBM because IBM has invested significantly in automation and big data software and cognitive. Basically, what we're saying is, yes our core business is getting commoditized, our basic business, but we are adding higher value at your services in software. We are becoming a software plus services business, practically. From a software side, on GTS, we will drive higher margin revenues and differentiation in higher value added services that are digital. We'll complement that with our services business that can scale at volume. In effect, we are creating a hybrid business model for the software plus services era for IBM. >> You're becoming a software company like everybody else. >> Mohammed: Yes. >> Right? >> Right. And IBM has, IBM has seen it and IBM has responded to it. IBM is invested in it, so we are building the ideas of service platform. We have invested in it. We're delivering to the market. We are re-skilling our workforce and we are creating a superior method of delivery for the cognitive era using a cognitive technology services delivery platform. >> You actually have a, as a service component of software in your PNL, is that right? >> Mohammed: Exactly. >> And that's the growing part of your business? >> Mohammed: We're tracking that line item as software as a service. >> We have to break, but I just want to spend a minute on your personal story. You came from India. You were highly educated, both in India and in this country, and now you're a senior executive at IBM. Quick story about your journey 'cause I love it. >> My journey started in India. I was always fascinated with technology in the United States because when I grew up, the United States was the country that put the man on the moon. We always looked at, I always looked at the United States as, as the pioneer in technology and I wanted to see how I could learn from it. How could I professionally grow from it? I did not know how, but a life is a journey. It got me to Oklahoma on a scholarship from a Master's program in operations research and computer science and then an MBA in finance. I move to Austin looking for a job, from Oklahoma. I worked for the government, the governor's office for a while, almost three years and then in the dotcom wave, I wanted to be in giving birth to new technology. I joined a startup in Austin that got acquired by Commerce One. From there, the journey took me to working with SAP, to building their middleware platform and then brought me back to Austin as a CTO for Texas again where I worked very closely with IBM for managing the state's data centers and building the software platform using the soul from our client and the software portfolio from IBM. What I realized during that time is really, the nature of IT services, consumption and delivery will change with cloud and it needs a new operating model of CIOs and CTOs. I created a company by CIOs for CIOs of how they would operate in a new utility model of it's combined cutbacks and outbacks and it's unified consumption across a very diverse supply chain. >> This is 2007 timeframe, right? >> Mohammed: 2007 timeframe. >> Just before the downturn. Perfect timing. >> Right, so leverage the tailwinds of cloud to build an operating model for hybrid, which is not being called hybrid, but was really a consumption centric model and a supply chain model from manufacturing that I learned at Commerce One and SAP. I said the supply chain concepts are very true for IT now because every unit within the supply chain is a service. >> The vision was to transform IT consumption. >> To transform IT consumption, delivery and governance in the enterprise. That led to Gravitant and the brokerage platform that IBM acquired in 2015. Currently my role at IBM is to drive this transformation into the enterprise and in turn, transform the delivery model for GTS. >> Well that's where we started. We'll have to leave it there, Mohammed. Thanks very much for coming on theCUBE and sharing your story. >> Mohammed: Thanks very much. It's a pleasure to meet you today. >> Okay, keep it right there, buddy. We'll be back with our next guest right after this short break. It's theCUBE. We're live from InterConnect.