>> (Narrator) Live, from Boston, Massachusetts it's theCUBE, covering Red Hat Summit 2017, brought to you by Red Hat. >> Welcome back to Boston everybody, this is Red Hat Summit, and this is theCUBE, the leader in live tech coverage. I'm Dave Vellante, with my cohost Stu Miniman, and John Hodgson is here, he's the Senior Director of IT Program Management at Optum technology. John good to see ya. >> Good, it's good to be here. >> Fresh off the keynote, we were just talking about the large audience, a very large audience here. And Optum, you described a little bit at the keynote what Optum is with healthcare, sort of technology arm. Which is not super common but not uncommon in your world. But describe Optum and where it fits. >> So in the grand scheme of things within UnitedHealth Group you know, we have the parent company, of course, you know the Health Group, our insurance side, that does insurance, whether it's public sector for large corporations, as well as community and state government type work as UnitedHealthcare. They do all that, and then Optum is our technology side. We do really all the development, both for supporting UHC as our main customer, you know, they're truly our focus, but we also do a lot of commercial development as well for UnitedHealthcare's competitors. So big, big group, as I mentioned in the keynote. Over 10,000 developers in the company, lots of spend, I think in the last year our, just internal IT budget was like $1.2 billion in just IT development capital. So it's huge. >> Dave: Mind-boggling. >> John, you've got that internal Optum Cloud, Can you give us just kind of the breadth and depth, you said 1.2 billion, there. What is that make up, what geographies does that span, how many people support that kind of environment? >> As far as numbers of people supporting it, I think we've got a few hundred in our Enterprise Technology Services Group, that supports Optum Cloud. We started Optum Cloud probably a half a dozen years ago, and it's gone through its different iterations. And part of my job right now is all about Enterprise Cloud adoption and migration. So, we started with our own environment, we call it UCI, United, it was supposed to be Converged Infrastructure, but I call it our Cloud Infrastructure, that's really what it is. And we've continued to enhance that. So over the last few years, I think about 3.5, four years ago, we brought in Red Hat and OpenShift. We're on our third iteration of OpenShift. Very, very stable platform for us now. But we also have Azure Stack in there as well, I think even as Paul and those guys mentioned in the keynote there's a lot of different things that you can kind of pull from each one of the technology providers to help support what we're doing, kind of take the best of breed from each one of them, and use them in each solution. >> Organizations are always complaining that they spend all this money on keeping the lights on, and they're trying to make the shift, and obviously Cloud helps them do that, and things like OpenShift, etc. What's that like in your world? How much of your effort is spent on maintenance and keeping the lights on? Sounds like you got a lot of cool, new development activity. Can you describe that dynamic for us? >> Yeah, we've got a really good support staff. Our group, SSMO, when we build an application, they kind of take it back over and run everything. We've got a fabulous support team in the background. And to that end, and it's on both sides, right? We have our UnitedHealthcare applications that we build that have kind of their own feature set, because of what it's doing internally for us, versus what we do on the OptumInsight side, where it's more commercial in nature. So they have some different needs. Some of the things that we're developing, even for Cloud Scaffolding that I mentioned in the keynote. We're kind of working on both sides of the fence, there, to hit the different technologies that each one of them really need to be successful, but doing it in a way that it doesn't if you're on one side of the fence or the other, it's a capability that everybody will be able to use. So if there's a pattern on one side that you want to be able to use for a UHC application, by all means, go ahead and grab it, take it. And a lot of what we're doing now is even kind of crowdsourcing things, and utilizing the really super intelligent people that we have, over 10,000 developers. And so many of them, we've got a lot of legacy stuff. So there's some old-school guys that are still doing their thing, but we've got a lot of new people. And they want to get their hands on the new fresh stuff, and experience that. So there's really a good vibe going on right now, with how things are changing, all the TDP folks that we're bringing in. A lot of fresh college grads and things. And they love to see the new technologies, whether it's OpenShift or whatever. Lot are really getting into DevOps, trying to make that change in a big organization is difficult, we got a little ways to go with that. But that's kind of next up. >> You're an interesting case study, because you've got a lot of the old and a lot of cool innovation going on. And is it, how do you decide when to go, because DevOps is not always the answer. Sometimes waterfall is okay, you know. So, how do you make that determination, and where do you see that going? >> That's a great question, that's actually part of what my team does. So my specific team is all about Cloud adoption and migration, so our charter is really to work across the enterprise. So whether it's OptumInsight, OptumRx, UnitedHealthcare, we are working with them to evaluate their portfolios of applications to figure out legacy applications that we have that are still strategic. They've got life in them, they've got business benefit. And we want to be able to take advantage of that, but at the same time there's some of these monolithic applications that we look at how can we take that application, decompose it down into microservices and APIs, things like that, to make it available to other applications that maybe are just greenfield, are coming out now, but still need that same technology and information. So that's really what my team is doing right now. So we sit down with those teams and go through an analysis, help them develop a road map. And sometimes that road map is two or three years long. Getting to fully cloud from where they're at right now in some of these legacy applications is a journey. And it costs money, right? There's a lot of budget concerns and things like that that go with it. So that's part of what we helped develop is a business case for each one of those applications that we can help support them going back, and getting the necessary capital to do the cloud migrations and the improvements, and really the modernization of their applications. We started the program a couple of years ago and found that if you want to hang your hat on just going from old physical infrastructure, some of the original VMs that we had. And just moving over to cloud infrastructure, and whether that's UCI, OpenShift, Azure, whatever. If you're going to do your business case on that, you're going to be writing a lot of business cases before you get one approved. It's all about modernizing the applications. So if you fold in the move to new infrastructure, cloud infrastructure, along with the ability to modernize that application, get them doing agile development, getting down the DevOps path, looking at automated testing, automated deployment, zero downtime deployments. All of those things, when you add them up together and say, okay, here's what your real benefit looks like. And you're able to present that back to the business, and show them speed to market, speed to value is a new metric that we have. Getting things out there quickly. We used to do quarterly releases, or even biannual releases. And now we're at monthly, weekly, some of our applications that are more relatively new, Health4Me, if you go to the App Store, that's kind of our big app on the App Store. There's updates on a very frequent basis. >> So that's the operating model, really, that you're talking about, essentially, driving business value. We had a practitioner on a couple weeks ago, and he said, "If you just lift and shift to the cloud, "and you don't change your operating model, "you won't get a dime." >> Stu: You're missing the boat. >> Maybe there's something, some value there, a little faster, but you're talking about serious dollars, if you can change the operating model. And that's what you've found? >> Yeah absolutely, and that's the, it's a shift, and you've got to be able to prove it to the business that's there's benefit there, and sometimes that's hard. Some of these cloud concepts and things are a little nebulous, so-- >> It's hard 'cause it's soft. >> It's soft, right, yeah, I mean, you're putting the business case together, the hard stuff is easy to document, but when you're talking about the soft benefits, and you're trying to explain to them the value that they're going to get out of their team switching from a waterfall development over to agile and DevOps, and automated testing and things like that, where I can say, "Hey listen, "you know your team over here that has been, "you know we took them out of the pocket, "from actually doing their day jobs for the last week, "because they needed to test this new version? "If I can take that out of the mix, "and they don't have to do that anymore, "and they can keep on doing what they're doing "and not get a week behind, what value is that for you?" And all of a sudden they're like, "Oh really? "We don't have to do that anymore?" I'm like, "No, we can create test scripts and stuff. "We can automate your deployment. "We can make it zero downtime. "We have," there's an application that we're working on now that has 19,000 individual desktop deployments. And we're going to automate that, turn it into a software as a service application, host it on OpenShift, and completely knock that out. I mean deployments out to 19,000 people take weeks to get done. We only do a couple thousand a week, because there's obviously going to be issues. So now you've got helpdesk tickets, you've got desktop technicians that are going round, trying to fix things, or dialing in, remoting into somebody's desktop to try to help figure that all out. We can do the whole deployment in a day, and everybody logs in the next day, and they've got the new version. That kind of value in creating real cloud-based applications is what's driving the benefit for us. And they're finally starting to really see that. And as we're doing it, more application product owners are going, "Okay, now we're getting some traction. "We heard what you did over here. "Come talk to us, and let's talk "about building a road map and figuring out what we can do." >> John, one of the questions I got from the community after watching you keynote was, they want to understand how you handle security and enforce compliance in this new cloud development model. (laughs) >> That's beyond me, all I can tell you is that we have one of the most secure clouds out there. Our private cloud is beyond secure. We're working right now to try to get the public hybrid cloud space with both AWS and Azure, and working through contracts and stuff right now. But one of the sticking points is our security has to be absolutely top notch, if we're going to do anything that has HIPAA-related data, PHI, PII, PCI, any of that, it has got to be lock-solid secure. And we have a tremendous team led by Robert Booker, he's absolutely fabulous, I mean we're, our whole goal, security-wise, is don't be the next guy on the front page of the Wall Street Journal. >> You mentioned public cloud, how do you make your decisions as to what application, what data can live in which public cloud? You said you've got Azure Stack, and you've got OpenShift. How do you make those platform decisions? >> Well right now, both OpenShift and Azure Stack are on our internal private cloud. So we're in the process of kind of making that shift to move over towards public and hybrid cloud. So I'm working with folks on our team to help develop some of those processes and determine what's actually going to be allowed. And I think in a lot of cases the PHI and protected data is going to stay internal. And we'll be able to take advantage of hosting certain parts of an application on public cloud while keeping other parts of the data really secure and protected behind our private cloud. >> Red Hat made an announcement this morning with AWS, with OpenShift. >> Sounds like that might be of interest to you, would that impact what your doing? >> Absolutely, yeah, in fact I was talking with Jim and Paul back behind the screen this morning. And we were talking about that and I was like wow that is a game changer. With what we're thinking about doing in the hybrid cloud space, having all of the AWS APIs and services and stuff available to us. Part of the objection that I get from some folks now is knowing that we have this move toward public and hybrid cloud internally, and the limitations of our cloud. We're never going to be, our private Optum Cloud is never going to be AWS or Azure, it's just not. I mean they've spent billions of dollars getting those services and stuff in place. Why would we even bother to compete with that? So we do what we do well, and a big portion of that is security. But we want to be able to expand, and take advantage of the things that they have. So that's, this whole announcement of being able to take advantage of those services natively within OpenShift? If we're able to expose that, even internally, on our own private cloud? That's going to take away a lot of the objections, I think, from even our own folks, who are waiting to do the public hybrid cloud piece. >> When the Affordable Care Act hit, did your volume spike? And as things, there's a tug of war now in Washington, it could change again, does that drive changes in your application development in terms of the volume of requests that come in, and compliance things that you have to adhere to? And if so, does having a platform that's more agile, how does that affect your ability to respond? >> Yeah it does, I mean when we first got into the ACA, there was a number of markets that we got into. And there was definitely a ramp-up in development, new things that we had to do on the exchanges. Stuff like that. I mean we even had groups from Optum that were participating directly with the federal government, because some of their exchanges were having issues, and they needed some help from us. So we had a whole team that was kind of embedded with the federal government, helping them out, just based on our experience doing it. And, yeah, having the flexibility, in our own cloud, to be able to able to spin up environments quickly, shut them down, all that, really it's invaluable. >> So the technology business moves so fast, I mean it wasn't that long ago when people saw the first virtualized servers and went Oh my gosh, this is going to change the world. And now it's like, wow we got to do better, and containers. And so you've gone for this amazing transformation, I mean, I think it was 17 developers to 1,600, which is just mind-boggling. Okay, and that's, and you've got technologies that have helped you do that, but five years down the road there's going to be a what's next. So what is next for you? As you break out your telescope, what do you see? >> God, I don't know, I mean I never would have predicted containers. >> Even though they've been around forever, we-- >> Yeah I mean when we first went to VMs, you know back in the day I was a guy in the server room, racking and stacking servers and running cables, and doing all that, so I've seen it go from one extreme to the next. And going from VMs was a huge switch. Building our own private cloud was amazing to be a part of, and now getting into the container side of things, hybrid cloud, I think for us, really, the next big step for us is the hybrid cloud. So we're in the process of getting that, I assume by the end of this year, early next, we'll be a few steps into the hybrid cloud space. And then beyond that, gosh I don't know. >> So that's really extending the operating model into that hybrid cloud notion, bringing that security that you talked about, and that's, you got a lot of work to do. >> John: That's a big task in itself. >> Let's not go too far beyond that, John. Alright well listen, thanks for coming on theCUBE, it was really a pleasure having you. >> Yeah, thanks for having me guys, appreciate it. >> You're welcome, alright keep it right there everybody, Stu and I will be back with our next guest. This is theCUBE, we're live from Red Hat Summit in Boston. We'll be right back. (electronic music)

>> Narrator: Live, from Boston, Massachusetts. It's theCUBE, covering Red Hat Summit 2017. Brought to you by Red Hat. (light techno music) >> Welcome back to theCUBE's coverage of the Red Hat Summit here in beautiful Boston, Massachusetts. I am your host, Rebecca Knight. I'm here with my co-host, Dave Vellante. Joining us is Marco Bill-Peter. He is the vice president of customer experience and engagement at Red Hat. Thank you so much for joining us. >> Thank you for having me. >> So I want to start out by talking about your management philosophy, and your philosophy really of what you do. Because that is just so core to the Red Hat experience for customers. I noticed that you changed the name, it's no longer Customer Support, it is Customer Experience and Engagement. Do you want to talk a little bit about why you made that switch? >> Yeah, I think, well yes, it would be awesome, yeah. I mean the name reflects actually, in my opinion, also the business model from Red Hat, which is you take an open-source development model, you develop the products, you actually sell them as a subscription. But there's no license behind it, which is the amazing business model, right? That there's no lock-in, right? The customer can buy it, they can use it, if we don't provide the value, then shame on us, they can move on. And so that's where the customer experience has to be good. That they really see, hey, I got something from Red Hat, I'm coming back, I will renew this. And the engagement is as well, it's the part, one is like, experience was great and engagement is, we got to engage them, right? Because shame on us if we didn't engage a customer in during their journey during that year of subscription life that they have, or three-year, whatever it is. That is the, I think it's the business model, but it's also my philosophy, which is, I used to work for proprietary companies and running support or customer success functions. There you make the money on the license and the maintenance is, basically, I always call it janitorial services. This way our model is different, so that's why I also report through Paul Cormier, it's integrated in technologies. It's maybe not the philosophy, but it's our philosophy really, the customer, it's not a joke, it's customer is in the center. And if they are successful, yes, they will come back, they will buy more, they will renew. But it's an honest model. And so that's why we changed the name for various reasons. I also, we looked at other functions at Red Hat, and said, "Which one is really about customer experience?" And security, for example, is in my team, right? It's not just support, because security is a big element of our value that we provide. And so that's why we expanded the team, changed the name to kind of reflect that. >> You mention Paul Cormier and we're actually, he's going to be joining us later today too. And he was talking about how the design process is really led by customers in this new era of cloud computing. >> Marco: Yeah. >> Talk a little bit about what it's like to collaborate with customers in these products. >> Yeah, it's really good. I can give you an example from the innovation award winners this week. We have, like, for example, British Columbia, the government of British Columbia, and they start on this journey and they wanted to create this, I would say, exchange for partners that they have, companies to kind of provide some services and make it easier for them. And they started on a journey and it didn't go well. And shame on whoever was involved in that. But then we got involved. I was like, okay, that's what you're trying to solve. We got one of my guys actually flew out there, spent a few weeks out there. He was like, oh, this is the problem, let's build it differently. Then Ashesh Badani from the open-shift team got involved and we realized, okay, what they're trying to do is this, change the product, adjust it. There's one example from last year's innovation award winner. We had Betfair. It's a horse-race company in England. Same thing, they wanted to really innovate a data center in a complete, like, software-defined way. And having that collaboration with us directly and the upstream communities, but then also with partners, like in that case it was a software-defined network provider, to get involved and really build the solutions. It's a whole different way. And if you go back a few years when we just did Linux, that maybe didn't really happen because it was more Linux was driven by the community. And now I think it's honestly good to see because it's customers involved, there's still a lot of partners involved and there is a strong community and that whole thing working together is pretty cool to see. >> There's a saying that I like. It's customer satisfaction is one thing, customer loyalty is everything. And you live in a world where customer loyalty really is everything. Describe, you mentioned before your previous company, what's the innovation experience and total customer experience like now and how do you innovate versus the way a traditional company might innovate in customer experience? >> I think traditional companies, they innovate around, since it's a maintenance budget, we've got to save costs, right? That's their take. It's like, save costs, deflect cases, deflect customers basically, right? And our model is the opposite, right? If I start deflecting customers that's kind of the negative of engagement, right? So pushing back customers that actually they see value if they have interaction so that's where we look at it completely different. We innovate around, you know, like two years ago when we talked about we presented Red Hat insights, the tooling that basically out of our customer support cases we provide back to our customers a connection that they know, hey, this might happen. That's one piece that, you saw it probably at the keynote today, it's integrated in our products now, right? And so that's one piece we innovate around. Support is not seen as an afterthought. It's like, how do we build this into our tooling? So insights was a good example as an innovation. We did a lot of workflow changes, which sounds very technical but really to provide more value back to the customers. So it's called a knowledge center support approach that you really basically take what customers provide you, rephrase that and provide it back as a documentation. If you run into this situation, and it can be a support situation, but it can also an innovation situation, they want to build something new, you provide that back in the form of documentation customer form. >> One of the other things that's changed in the last two years is this explosion of artificial intelligence, some people call it cognitive, and we saw the kickoff video this morning how, and we talked about this a little bit a couple of years ago, how you're going to use data to improve customer experiences and now we're here. How are you using data and insights and analytics to improve the customer service? >> Analytics, I think, we started in a way in a traditional way, right? You have data and then you've got to figure out the data and then you kind of just create rules out of it. If this and this happen you do this. Call it AI, sounds cool, but basically it's rules matching. This happens, that. Now I think it's detecting the trends more automatically that's more done in, I would say, in more real AI. That's where we are. I would say the last year we spent more time figuring out, hey, how do we, instead of trying manually find the trends to actually automatically find them. And I think there is, I just gave an interview a few weeks in Japan where AI is a really hot topic, I think we're just scratching the surface. You saw it in autonomous driving but I think in support there's so much more to do in this area as well. >> When I asked you, you know, about juxtaposing Red Hat versus, say, a traditional software company it would seem like cutting costs was in conflict with innovating for customer experience but when I hear you speak about AI, is it possible there's a relationship between the two? That you can actually improve customer service and cut costs? >> Absolutely, but you want to do it in a good way. You want to do it in a way that it provides value back to the customer. If you do it an way, hey, we've cut out this and this things, then the customer just gets a lousy experience. That doesn't, I think that doesn't even work for a traditional company or proprietary company any more. That whole old, no, there's other companies that do autodeflection, right? But I think if you actually optimize the experience in a way that also the customer sees, hey, this is actually great value, right? If you just optimize things and the customer experience is great, you might actually create a situation where customer doesn't see value, right? Like in the old days, we had a lot of customers saying, hey, I never had the support case, why should I pay you guys? So, you know, obviously you can talk about that's great you didn't have a support case, but a customer paying a few millions and they only had one support case is a tough recovery. Today, not AI, but a lot of data is we can tell the customer, yeah, you had one support case, but look at all the tools you used in the customer portal, all the interactions you have. We have a nice dashboard we can present back to a customer. And, I'll give you, if you have a minute >> Yeah, please. a story quickly of a CTO from a bank that, a few years we met, and then he said, "Oh, Red Hat, you guys are good." That was in a bar. "You guys are good but, you know, I don't really need "your support, Marco. "My guys, they know how to do things." And so, I was like, okay. So in the evening I went back to the hotel, looked at the dashboard and then realized his story was maybe not as realistic. Next day, I see him again and show him the dashboard. And support was involved. There was documentation in use. I showed him back, I was like look at this, this is the value we provide you. And out of that came a whole different discussion, as in we do it annually now, and we looked at this data and he sees trends. He sees like, "Oh, my Latin America bank, "they still use this and this. "My North America team does that and that." And it's a whole different discussion. It's awesome, right, that they realize from the data we have there is a lot of value that he can change his operation. That's a short example. >> I want to talk to you about security. You mentioned this earlier in our conversation. The era of cloud computing is maturing and we are seeing now customers caring more about compliance and governance and management. What are the big concerns that you're hearing from customers? >> Obviously the big concern is still the traditional vulnerabilities, right? If there is a security hole, how do we fix it? How quickly fix it? Do we have the right data that we provide back as a customer realizes, is this a security hole I need to worry about or not. And that's what we do, we kind of focus on, we have a pretty large security team, I think, for the size we are because of the open-source model. So they're involved in a lot of the communities. So we provide fast response and we also provide response not just with a security fix but also with information about, hey, this is why you should worry or this is why you shouldn't worry. 'Cause sometimes the press creates this frenziness about, hey, pick your favorite name of a security hole, Heartbleed, et cetera. And for some customers it doesn't really matter because in their environment this is not a real scenario, right? And so we provide the patch, we provide data or documentation, but then also tooling that they can figure out are we exposed or not. That's one of the things. The other problem is in containers, right? You have these containers. You build the containers from everywhere. To actually realize, hey, is this container also compliant with security is a big topic. We just released, released, or we will release this week, it's not a secret, the container catalog, with actually a scoring that actually says, yes, this container is quality A, B. Kind of a freshness score. >> Ah, a ratings system. >> Yeah, rating. And this is a huge effort for every company and we do it as well, as in how do we keep these containers updated, right? Because you, if you build a container from application to middleware down to the operating system, you've got to worry about a lot of security. >> It's a fresh date. >> Yeah, it's like expiration date. >> A sell-by date. >> And that's what we do actually. We have an expiration date but depending on security hole, that just changes. >> So we were talking to John Hodgson who was at the keynote as well and he was telling us, and he mentioned this in the keynote, that he went from 17 developers in 2009 to 1,600 today. He was talking about that a lot of them are kids right out of college and we were talking about how you have to treat millennials differently and give them flexible time. And, Rebecca, you were talking about a new way to work at the beginning of our segments today. So how is that new way to work affect the customer experience and what are you guys doing in that regard? >> I mean obviously, like you say, right, there's a whole new generation coming and I actually think the new generation, they're actually a pretty sensitive customer experience. I think they're growing up in a different age of like digital age so, and social media as well, so actually I was worried that the new generation maybe, but I have to say, I think contrary, right? So that's good. So I don't think customer experience will suffer. What will change is, like, you can't have people, you know, we don't have it, but like call centers, if you have a little farm for everybody. That just ain't going to fly anymore, right? And so that's where we got to adjust. We don't do call centers, but we got to just adjust, like, how is the office done, where is it, and things like that. But it's, I think, I'm not too worried about that. >> And mobile is huge for you guys obviously, right? The mobile trend. And there's a lot of talk in Silicon Valley about, you know, what's next beyond mobile. How we, this is not how we're going to interface with our two thumbs in the future. It's going to be voice and, you have to be careful not to over-rotate either, right, because you could ruin the customer experience. Do you do that type of advanced, you know, research in total customer experience? >> Yeah, we do research. We actually also research how do they interact with us. You know, mobile is always a topic but our customers aren't engaging as mobile. You know, like it's, I mean-- >> You say they're not? >> They're not, no. >> They're out there. >> You know, our portal is all mobile enabled so you could go with it, but mostly it's still laptops, notebooks, et cetera, that they're using to engage us. So we haven't really invested a lot in that, but we invest in the digital experience, right, so make it easier, provide the tooling, don't force a customer to jump through, like, hoops to find something out. Give them the tool to find out. They want to self-solve a lot, right? Which goes back in the old discussion, is that deflection? But if a self-solve tool helps you, I think customers see, hey, this is value from Red Hat. >> If they can do it themselves, yeah. >> Marco: If they can and they can learn something, right? That part is good. >> Well thank you so much for joining us, Marco Bill-Peter, who is the vice-president, customer experience and engagement, at Red Hat. I'm Rebecca Knight, for Dave Vellante, thank you so much for joining us and we'll be back after this break. (light techno music)