(upbeat music) >> Hi welcome to theCUBE studios for another CUBE conversation where we go in-depth with thought leaders driving innovation across the tech industry. I'm your host Donald Klein. As digital transformation continues to impact industries, the application workflows employees rely on on a day to day basis are becoming increasingly customized. This trend towards customization is presenting new challenges for the workforce of the future. To talk about that challenge, I'm here today with Gary Mahotra, VP of Product Marketing at WhatFix. >> Hi Don, thanks for having us. >> Glad you're here. So this conversation is kind of following up on an earlier conversation we did with Vara Kumar about some of the challenges for the workplace of the future. >> That's right. >> And of particular interest is you guys have done some new survey work, right, around some of the challenges or the new challenges that we have in the workplace around using applications. So I wanted to kind of have you talk a little bit more about that. But maybe before we do that, why don't you just refresh us and just explain Whatfix does and kind of where they fit in. >> Great, so Whatfix is a digital adoption platform. We provide on-screen guidance, self-help, and automation capabilities to enterprises and employees to really drive up adoption of the features and their applications across all cross application workflows. >> And so the important point there, this is what you call kind of in-application guidance, right? >> That's right, yes. >> All right, great. So you're providing screens that help people navigate these very complex apps that people are using on a kind of day to day basis, right? >> Yes, and the screens can be smart tips, pointers. They can be interactive walk throughs and easy flows. They could be better self-help across applications. They take a variety of forms. >> Okay, got it. Now this is a super hot area, right? You're with a company, you guys have seen fantastic adoption of your solution. I think you were mentioning to me that you guys have an NPS score that's in the 100th percentile, which is sort of unheard of for a software company. So this is a hot area, but we want to understand why it's a hot area. So you guys have been doing some survey work around the the future of the workplace. Why don't you talk to us a little bit about that survey and kind of what are the kind of, some of the things you found? >> Sure. So you know, we surveyed 500 enterprises in North America and we looked across areas, but also focused on the CRM area and what we found is 75% of sales reps in an average enterprise do not regularly use the CRM system and we also found that 90% of these enterprises believe that digital adoption and learning in the workflow technology would increase their employee productivity and increase the employee experience. >> Okay, so let me understand why that number is so high, that 75% of sales reps aren't using their CRM application and then, I mean obviously, CRMs have always been the bugaboo for a lot of reps, right? Filling in the data, as you said, but really in today's world, it's even more of a problem isn't it because these CRM apps are actually being sort of highly customized to the individual kind of workflows of different companies. Is that right? >> Absolutely. So you know, Gartner has the statistics that an average company has 14 different CRM applications or modules that a sales rep is using everyday and these are heavily customized to organizations and sometimes you know, within different business units and geographies, within an organization. Obviously, customers are different globally and products that they're selling are different so the CRM has to be customized and I think you'll add to that the complexity that up to another two, 300 cloud applications that integrate with the CRM in and around ad and then you know, the API, three API world, there's so much across application web flow that it's not easy for an average employee or sales rep to keep up with. >> Got it, okay. So there's kind of two challenges here, right? So the CRM application itself, right, is going to be sort of specific to lots of different workflows, even within business units, right? That's a huge challenge for somebody working in a company to kind of learn all that, right? And now what you're saying is that actually, it's even more complex, right, because you've got a lot of other applications that are integrating in and interfacing, right? >> Gary: Absolutely, absolutely. >> So it's kind of like a cross workflow challenge to be able to understand all this stuff. Is that right? >> Absolutely. And you know, with the movement to the cloud, all of this is rapidly evolving. There used to be a time when product software companies would release new releases once in 18 months. Now it's twice in two weeks, right? And so there's that infusion that, you know, even a sales operation manager or IT manager and learning and developing managers have to keep up with and it's certainly difficult for the average employee to keep up with all this new functionality. >> Great. So APIs in the clouds are kind of driving kind of just increasingly evolving applications that are becoming even just a challenge to kind of keep up with them as they're evolving, kind of let alone kind of learning them end-to-end. Right, yeah. >> Absolutely. >> So this is kind of, what you guys are tackling is really kind of almost a learning and adoption problem. Is that right, more generally? >> That's totally accurate and more specifically, you know, we're enabling learning in the flow of work because there is this whole megatrend of the merger of learning and work together because there's so much that an average employee has to learn. There's so many applications that it is not practical to expect an employee to attend a couple weeks of training. They're going to forget 90% of that within a week and then as their work-life progresses, the statistics from LinkedIn and Deloitte, you know, employees are only able to spare 1% of their average work week toward formal learning. So there's no choice other than you know, enabling them throughout their workday, throughout their applications with sort of micro moments of learning, in-the-app learning, like you said. >> That's a fantastic comment there, sort of what do you call it? Micro learning. >> Micro learning moments. >> Micro learning moments. >> In the flow of work. >> That's fantastic, okay. And so that's really what you're saying is the people don't, you know, the old school way was to attend a training class, get up to speed, right, and then sort of use that throughout the year. Well, that doesn't work anymore. >> Doesn't work at all. >> Okay, got it. Right, so then talk to us a little bit about kind of what WhatFix does to kind of do that. So you're providing an application that kind of provides kind of guidance screens, is that right? >> Yeah, so we basically provide three things. The first is what you said, we provide step-by-step guidance, content. So if there's a new user joining the application, they're guided as to where, a tour of the application or what are the key high value things they should be sort of interacting with. The other thing we do is we're providing many elements, or many learning task lists that a user's required to complete and when they do, they're actually clicking through the application. This is not a YouTube video they're watching offline and hopping where to get back into the screen at. This is actually them clicking through the screen. The second thing we provide is you know, better self-help across the enterprise. You know, when they're actually using our self-help widgets, they're able to get personalized, contextualized content based on who they are, where have they clicked before? Which department do they belong to? So they actually get relevant context right there. The third area we provide is what we call automation. So a lot of the processes that sales people and employees will have to do is to click, you know, empty clicks and navigational clicks and a lot of times spent on data entry. So we have a whole automation framework where we just eliminate the manual processes completely and we automate them and then we have bots that you can use for data entry so it's very easy for employees. >> Understood, understood. So then kind of walk us through what the typical kind of adoption cycle for a customer who says okay, you know, yes, we understand our whole kind of, we've gone through a period of digital transformation. We now have a lot of very essential applications that kind of manage our day-to-day workflow inside our company, but the challenge is getting everybody to use them in the right way and kind of populating them with data in the right way. We'd like to look at your solution for helping us kind of get better at that or at least help our employees get better at that. What is the journey that they go through from kind of beginning to end to kind of enable this using your system? >> So great question, Don. So I think the journey that we undertake together with them, is to first understand what the workflows look like across applications, where they're excessively long or manual or nonproductive so we can apply the right, you know, digital adoption platform, widgets or right functionality so we have the maximum impact. So that's sort of the first phase. Second, what we do is we look at, you know, the key workflow areas that their, you know, departments or their functional heads want them to use to have the maximum impact on productivity or the maximum impact on business outcomes and we basically authored our content on top of that. Now the reason it is so fantastic is once you've actually authored some step-by-step guidance, you know, onto say, Salesforce, using our content, that automatically is not only available in the application when you log into Salesforce, but it automatically gets converted into multiple formats. It gets converted into a video, in LMS, a course that you can take, a slideshare, a PDF, an article, and these are automatically sent throughout the enterprise. So even if the sales person is not in Salesforce doing work, they're on their mobile phone, perhaps, you know, interacting with a chat bot or maybe they're taking a LMS course, they have the same in-app content and guidance available throughout. We call it adoption everywhere and then, you know, maybe they're on the road, they see something, they read it. In one click, they can see live and they actually get back into the application to really execute that process. So you know, call it learning by doing. So that's what's so unique about you know, digital adoption platforms and this takes six to eight months. You know how hard it is to recall videos or how to use every aspect of the application. Now it takes you know three to four weeks. >> Interesting, interesting. So in a former life, I was once responsible for developing the user manual for our application which we sold within the enterprise, right? And everything was all written out in text. Well that's almost a bygone era now, isn't it? >> It is because I'm sure things change so fast and you know, not everybody likes to read text. A lot of people are visual learners. They want to see it in video. Some people are kinesthetic learners. They want to actually learn by doing and so that's what visual adoption enables. You don't lose the text, but you don't have to start there. You know, we give you the text based on how do you use the application? >> Interesting. So you're actually providing learning materials. >> Absolutely. >> For future consumption based on how people are using applications today. >> Absolutely, and then anytime you go back, you know, a month or two later, within the application, change the workflow, the process, automatically, all of the learning materials and all of the five or six formats I mentioned, regardless of where they are, is forever linked and automatically gets updated. So you don't have to, you know, worry about, okay, I made this paragraph change. Where are the 100 places I now need to go and change that? So that problem is solved forever. >> Interesting, okay. So let's just talk, you know, as we kind of wrap up here, let's talk a little bit about so the survey found that kind of 75% of you know, reps, particularly with just an application on CRM, right? I'm sure you got similar data for lots of other application categories, but something like CRM is a little problem point for a lot of companies, right? >> Yes. >> So people are, companies are adopting your solution in order to kind of keep the teams updated on how to use the applications, how to make sure that the data's properly populated right and even, you know, drive kind of materials and intelligence from all that usage history, right? >> Gary: Yes. >> So where do you see this going? What's the kind of workflow of future going to look like once solutions like yours have kind of been adopted here? >> Yeah, so I think that's a great question. I think what we see is that you know, the workflow of the future's going to have three things: one, there's going to be more and more applications in the cloud, connected in more and more ways with each other through API's and more and more customized. So you know, a future worker has to be digitally savvy, up to digital kosher and become comfortable navigating in this complex, highly digital world across multiple applications. So that's one. I think the second trend is they're going to have to focus, most employees and companies have the workers and employees focus on the most critical activities and be comfortable with bots and automation doing the routine tasks and the data entry and you got to be comfortable with giving up some work and I think the third thing is you know, these workers and employees have to learn to live with these bots and automation and be willing to accept hyperpersonalized you know, digital guidance and be comfortable acting on it. So when you log into your Salesforce, you may be shown a completely different sale content because you've been with the company for 10 years, you're a rockstar seller and you need a different level of sort of high-end learning versus you know, I may be shown a totally different set of content because I've been clicking and searching a lot on some topics. I'm a new sales rep or employee and I've not met my quota. And that's surely the future and I think companies and enterprises, you know, who are comfortable with that, you know, will succeed and we're certainly there to help with that journey. >> Wow, so it's interesting. So hyperpersonalization of application content. >> Absolutely. >> Is kind of the new trend that's going to be happening which presents a whole kind of learning and adoption problem in it of itself, is that right? >> Well, it does, but it also solves the problem because if you're presented content that's not contextual to who you are, how long you've been at the company, what you've been looking for, most likely, you're going to get distracted and not adopt the application or not do what you would do. But if you do get that, then your adoption really goes up the roof, you're really happy. You got the, it's like the application understood what you were trying to do and guided you in doing it and that's your best buddy, right? It's actually going to solve the problem. >> Okay, fantastic. So love that story. Like what you're talking, understanding what the challenges are for workplace of the future. So on that, I think we're going to close out here now and I'd like to thank everybody for joining us for this Cube Conversation. I'm Donald Klein and we'll see you next time here on the show. >> Gary: Thank you, Don. (upbeat music)

>> Narrator: The Wynn resort in Las Vegas It's theCUBE. Covering .NEXT conference 2016 brought to you by Nutanix. Now here are your hosts, Dave Vellante and Stu Miniman. >> Welcome back everybody. Professor Deepak Malhotra here. He's with the Harvard Business school and author of Negotiating the Impossible: How to Break Deadlocks and Resolve Ugly Conflicts. Parenthetical without money or muscle end parenthetical. Deepak, welcome to theCUBE, great to see you. Thanks for having me here. Happy to be here. So what do you do in here? Well among the other things that I do with my time, I happen to be on the board of advisors for Nutanix. And I've been working with Nutanix for the last, a little over two years on various aspects of negotiation, deal making, training, etcetera. And so I attend a few of their conferences a few of the sessions. I talk at a few of their conferences as well. So that's what brings me here. >> So it's somewhat odd, right to have a negotiations expert come and talk to customers about negotiations. But I guess the angle would be if you're stuck in sort of a legacy world. You need to negotiate your way out is that. >> Well there's a couple of things going on there, right. So under one hand I think it shows a little bit about Nutanix's perspective. That it isn't a zero sum game. It's not we're going to train the Nutanix people so they can get an advantage over customers. I think the company really is focused on creating as much value as possible for the end user. And when you take that mind set it actually makes sense to be inclusive. And bring everybody in the ecosystem into the room. So it's not just, "Hey Professor Malhotra can you train our sales people?" It's you know we want to share your ideas with everybody. And I think that's really a good sign when a company is willing to do that. The second thing is as you just eluded to, a lot of the folks that are coming here and a lot of the people that are customers were thinking about moving in the direction of Nutanix. Or have bought into the idea. They still may need to sell it internally. They still may need to negotiate internally how do we change our organization or how do we move our organization from what its been doing to what it wants to be doing or it should be doing. And they're also many of the same skills can be useful. So why not educate them about some of the things they might not have thought about yet. >> So let's talk about your book a little bit. The premise. I guess I told you I haven't read it yet but I do have it. In the book you talked about a three thousand year old Treaty of Kadesh. And things that we can learn from three thousand years ago. Give us the basics and the premise. >> So this was. The books starts out with this story of the Treaty of Kadesh which I don't think is something that many business books start out talking about. Certainly, I hadn't seen it before I started researching it. And one of the interesting thing that happens is that there's a lesson embedded in the story of the Treaty of Kadesh that I think is as relevant today in negotiations of just about every kind in the business world and outside that, that's worth telling. And the basic story goes as follows. The Treaty of Kadesh is the most ancient peace treaty known to man kind. As far as we know it's as old a peace treaty as we have evidence of. And it was between the Egyptians and the Hittites. And these two parties were at war. And at some point they must of decided enough of this we need to put an end to this. There's too many cost internally and externally. Too many other threats. We need to find a way to resolve this kind of conflict. What often happens in these situations is that nobody wants to look weak. Nobody wants to be the one asking for peace because that might just embolden the other side. So what ends up happening is that somehow they overcome these hesitations. They reach this agreement. Now what's interesting is that we actually have access to both language's version of the treaty. So we have the Arcadian and the hieroglyphics. The hieroglyphics being the Egyptian version and the Arcadian being the one from the Hittites. And if you were to read both of these or if you were to first learn how to read these and then to read both of these. What you find is as you'd expect, they have a lot of the kinds of things that you would normally expect in a peace treaty. You know exchanging prisoners of war. Mutual assistance packs and things like this. And they're basically identical as they should be because they're the same peace treaty. But there is one difference. When you compare the two peace treaties the one difference that sort of stands out is that in the Egyptian version it says it's the Hittites who came asking for peace. And in the Hittite version it says it's the Egyptians who came asking for peace. And what it goes to show I think is that no matter how far back you go this need for every side to declare victory at the end of a negotiation at the end of a conflict. That need for every side to declare victory is as old as human beings themselves. When you understand that. I think it actually changes the way in which you try and negotiate these deals. How you think about what stands in the way of getting the deal done. Sometimes it's not the substance of the deal. You're already proposing something that's good enough. You're already have something on the table that's rich enough, valuable enough. They should say yes. But they might be other reasons they can't say yes. For example they might lose face. Or they may look bad. And when you recognize that I think you come at it a different way. >> Looking at your research. One of things you focus on is trust. And one of the challenges we have in technology is you know, people are entrenched with the way they do things. They're not likely to you know be first or go there. We've now got thousands of people using Nutanix but you know. How does Nutanix or others that are new get a proper seat at the table and be able to be part of a discussion that you know when you've got (mumbles) in there and the old ways of doing things. >> You know the way I see it. You have to get the economics right and you have to get the psychology right. The economics is you have to have a good product. It needs to be price appropriate. You need to be bringing value to the table. And be pricing based on that value proposition. So that's sort of basic business stuff. The problem is as I mentioned earlier. You may have the right product. You may have something that people, quote should be using. It is better than the alternative. But they might be these psychological hurdles that you need to get over. A prominent one being what you just eluded to which is when nobody else is doing it, nobody feels the urgency to do it. If you get the sense that you know there's not a mass of folks running after your product. They sort of feel like, well maybe that means something. Maybe it means it's not a big deal. Maybe it means it's not so urgent. Maybe it's not that good of a product. So the early hurdles that companies like these face are really big ones. You don't have a long list of customers that you can use to prove to other people that this is the way you should be going. There's always a risk that somebodies going to take a bet on this and if something goes wrong. It's sort of the old nobody lost their job buying IBM kind of mentality. And so as a negotiator and as a company that's starting out as an early stage company, especially in technology where you're doing something disruptive, you need to start thinking a little bit about how do we get them over that. How do we get them to start understanding that you know what. Here is a list of customers that are using it. And here's the testimonials, etcetera. You think about the pricing. The most common thing that happens when you walk into the room with a new disruptive technology is that the person on the other side says, "Are you crazy? "You're charging ten times what your competitor is charging. "You know you're sitting here telling me "to pay x. "If I do nothing I have to pay zero." Alright. "Nobody pays this kind of money for this kind of thing." That is a very common response sales people get when they are in an environment like this. And one of the things I advise people to do in that situation. Is to make sure they don't make the worst mistake a sales person can make in a moment where somebody says, "You're price is ten x what everybody else "is charging. "Nobody pays this much." The worst mistake a sales person can make is to apologize for the price being too high. Now they don't always do it by saying, "Oh my god I'm so sorry." But they seem apologetic. You know they're very quick to say, "Oh yeah I know it's high." >> "Let's see if we can do something." >> "I'm sure we can work something out. "But yeah you know I know it's a lot of money." The moment you go in that direction what you're basically doing is you're giving the other side a license to haggle with you. 'Cause what you're telling them is even you don't think the price is appropriate. A better response in a situation like this is for the sales person to say, "Listen I think the question you're asking me is, "how is it that despite our price being ten x "what some other people are charging, "we have a long list of people wanting to buy our product. "What kind of value must we be bringing to the table "for so many people wanting to buy this product? "Now I'm happy to talk about that value "because at the end of the day we all know nobody's "going to pay more for something than it's worth. "Nobody would do that, you're not going to do that. "So why don't we figure out what it's worth "and then you can make the right decision." And what you're doing there is you're shifting the conversion from price to value. You're shifting the frame of this conversation from how much am I having to pay and what's the cost to me to what is the value proposition. >> Stu's laughing. I mean your price is too high is the best sales objection ever. Right, you love to hear that as a sales person. Much better than your product sucks. (chuckles) Now the answer of this question is probably it depends. But when you advise your clients and your friends. When I go into a negotiation am I trying to get the best deal or am I trying to find common ground and get a win-win? >> Actually I don't think it depends. I think. (exhales loudly) Well I would. I would articulate the question slightly differently. Because in my experience it is possible to get a great deal and a great relationship. It's also possible to get neither. And so what you're trying to do is you're trying to optimize on both. What's interesting is that very often we assume it's a zero sum game enough. That the only way for me to get a good deal is for me to sacrifice the relationship in some way. That's not how it works in most sort of richer context, more complicated deal scenarios. Because what people evaluate when they walk away from the table isn't just did I get a quote, good economic deal. When people think back and say, "Do I want to work with this person again? "Do I like this person? "Did I get a good deal?" Often what they're thinking about is not so much of the substance of what they got. What's in the agreement. But the process they went through. For example. You know did the negotiation go as long as should of or did it drag on too long or end too abruptly? Was my voice heard? Did both sides move away from their opening positions? Did the person haggle with me on every little thing, even though they knew and I knew it's not a big deal to them and is a big deal to me? Those sort of process elements if you navigate the process more effectively you can often get to a point where you get the deal that you think is right for you and you get a relationship that both sides can walk away feeling good about. And from my perspective you know what does depend in, on it. It depends on the situation is what kind of feeling do you want them to have walking away. You don't always need to have them love you. But at the very least they should respect you. Right? And I think it's perfectly fair even in a very contentious negotiation to keep as one of your objectives. You know when the deal ends I want them to be able to walk away saying, "You know what, I maybe didn't agree with this person. "It didn't go exactly the way I wanted it to go. "But you know I can respect this person "for the way they handled the situation. "And if I were them I hope I would do it the same way." >> So I wonder. If I look at the society as a whole, it seems as if we kind of retreated to our sides and I find that lots of people aren't open for debate. They're intractable in what's going on. How do I get beyond that? >> How do we change society, is that the question? >> Stu: Yeah. >> How much time do we have? >> Am I wrong. (laughs) Is it only ten percent of the people that are intractable or are most people reasonable? >> So I think what happens is, there's a few interesting dynamics. Now I wouldn't have the precise numbers. What I can say is that it is certainly the case that even a minority of people being in those entrenched positions, they get a lot more of the media. They get a lot more of the attention. They tend to be louder, etcetera. And they can often drive our sense of what's actually happening. And it can drive the narrative. Now that doesn't mean there aren't real differences. Like strong differences. You know what's interesting is if you take people that are not on the extremes. You take the moderates. Sometimes the way in which we engage with people on the other side of the argument pushes them to be more extreme. See when we ourselves show up, thinking of ourselves as relatively moderate, enlightened people who have a set of point of view. But you know what I'm very open to other peoples perspective. But then we get into the conversation. And we end up challenging people in a way they don't find particularly useful. We start poking holes. We start making it's about a winning and a losing and a debate. And there's going to be at the end of the day points, score based on who wins the argument. Then people end up getting more and more entrenched. Even in ways that they otherwise wouldn't be. So the question is can we get to a point where at least those people on each side. And I find on any political issue I can find people on both sides that I think are trying to do the right thing and have perhaps limited information but they're trying to do the best they can with that information. They have good intentions and they're reasonably smart people. In my experience, you don't need two people one of whom is either evil, or crazy, or irrational to have conflict. You just need two people. You see good, smart, reasonably well-intentioned people getting into conflict all the time. Which then becomes the question of this book, which is how do we manage those situations? How do we get people to back away from these entrenched positions? How do we overcome deadlock that allows both sides to walk away feeling a little bit better about the situation? >> So examples are instructive. So let's talk about some great negotiators. Who are they? Let's start with sports. Scott Boras. You know you think of him as an agent. I mean grinding the teams, the general managers. Is he a good negotiator? >> So I don't follow many of the sports deal making and negotiations enough to be able to really elaborate on who would be a good negotiator in sports. But I can say this. That in a context where it's really just about things like price. Just about the money. And a sports agent often is, it's not really all about that but it is the most (mumbles). It is the most (mumbles) issue. You're going to go at it a certain way. And it would be similar to a negotiation in the business world where all you care about is price. You're buying or selling a house. You're buying or selling a car. And from my perspective there are people who are very good at haggling. There's people who can hold their cards to the chest and they can be aggressive when they need to be. And they can be persuasive in certain things. But when you look at negotiation as a whole. I think of haggling as a very, very thing slice of what negotiation is about. That's sort of the easy stuff. You may not be naturally good at it. But what it takes to be good at it is not so hard. We teach that on sort of day one of class. Day one of class is the price haggle. It's the you know there's two sides and you want opposite things. And how do you frame it in the right way and what kind of concession rate should you make or not make. How do you justify your proposal etcetera. We cover that on day one. And the problem is there is in our owner president program where I teach there's 15 more days left. In our MBA program there's like 27 more days left. And there the question becomes how do we get past just being a good haggler. Somebody who can just put fist to the table and say take it or leave it. And all that kind of stuff. Which will work in certain defined contexts but will not carry over to more important deals. >> You're right. That is a narrow context in sports because the agent has all the leverage of the players performed. How 'about Donald Trump? He's negotiating isn't he when he says Mexico's going to build the wall. He wrote the book, Art of the Deal. >> He did write that book. Yeah we co-authored that book actually. So is he negotiating when he says that. In the broader sense of the word negotiation which is basically how do we interact with other human beings who see things differently than we do. He absolutely is negotiating. If the question then becomes is he doing it effectively. My view would be that, that he is not. (chuckles) And I think if you actually were to look at the evidence and then stack it up. I think you would find that he's not a very effective negotiator. >> We don't have to go there. That's good. >> Deepak: That's okay I don't mind. >> We'll leave it there. But how 'about (mumbles), right. I mean you've had like an epic negotiation to bring those two. Is that an example? I mean even though it ended in tragedy on both sides is that an example of a successful negotiation? >> So it's an example of a, it is an example of a successful negotiation. And I think even more instructively it's an example of one of the biggest barriers in conflicts like this. The hardest part is often to bring your own side with you. And that is a challenge for leadership. It's not just in the bubble of negotiation. This is about leadership generally. To be able to have someone who can not only personally be willing to do the kinds of things that make the kinds of sacrifices but to be able to move a group of folks who for years, sometimes decades or centuries have been thinking differently. And to your point what often happens with these peace makers is you know the risk is you do one of these things and you're going to get killed. And usually you get killed by your own side. And exactly in the context you're talking about that's usually what happens. And so here what we see is not only an impressive set of events that led to negotiation and the negotiation itself but you see a certain amount of courage that leaders don't often enough show. And again some leaders aren't placed well. They don't have the support going in. Or they just don't have the ability to do it. But even those that do. The question is are you willing to expend the social and political capital necessary and put yourself on the line to be able to do something that you think is worth doing? >> I said I wasn't going to ask you but I am going to ask you 'cause your answer is so good. The Iran Deal. Good deal, not a good deal? You see to your point about getting killed by your own side. >> So I was not involved with the Iran deal. I do work with sometimes governments negotiating difficult conflicts and such. But I was not in any way involved with the Iran deal. What I can say is, based on the folks I've talk to leading up to the Iran deal and then after the Iran deal. It is my sense looking at what was accomplished that is actually a phenomenal deal for when it was done. Could a better deal have been done ten years earlier? Yes. One of the hardest things to negotiate against in the real world is the status quo. It's a lot easier to negotiate don't create center (mumbles) when there are none than it is to negotiate remove the center (mumbles) you have already created. So if you could go back in time which I have not met anybody yet who's able to do effectively it would be possible to get a better deal. Where things were last year and the year before I can say that pretty much everybody you talk to before the deal was announced on either side of the political spectrum, Republicans, Democrats, left, right, Hawkish, Dovish, you name it. Nobody would of expected a deal this good for the American side at the time. Now you may still not like it. You may be against any deal and that's okay. You can certainly have that perspective but if you're going to get a deal in this environment and what was being said leading up to this. I think both sides were pretty surprised and I would even say impressed. Until it came time to start talking about it publicly at which point of course you have to go back to your narrative. So you know again, I had nothing to do with it. But when you look at it, it surprised most people in terms of what it came out to be. >> So what are you working on? Next projects? Things that are exciting you these days. >> So I have sort of three areas where my attention is going. One is on ethnic conflict and armed conflict. As I was eluding to earlier I do some work with governments that are dealing with insurgency and conflict. And looking at what we know and what do we not know about resolving these kind of things. And how we can maybe push forward in that direction. So that's an area of advisory work but also research that I'm doing. Second area is I'm working with doctors. Thinking about how they can be more effective in prescribing a course of action to patients. How they can have more effective kind of conversations when a patient comes in and has a strong set of beliefs about what they should and shouldn't do. Or they're resistant to change. Or they're unwilling to do things. How can you be more effective in the time you spend with patients. And I do work on gun violence. And we've been looking at mass shootings. And we just had some research that got a lot of coverage unfortunately because of the tragedy that took place in Orlando not so long ago. Looking at whether mass shootings really have any impact on gun laws. And we find some interesting results there. So in a sense I'm sort of looking at insurgency and dealing with cancer patients and then gun violence. >> Interesting topics. >> Deepak: All of the darkest stuff we can find. >> It's a tragic but timely. And then there's another sequence there. Do gun laws have an impact on mass shooting. >> Deepak: And that's basically the next set of projects. >> Excellent. Well thank you very much. (mumbles) >> Deepak: It was great. >> Fantastic. >> Deepak: Absolutely. >> Alright keep right there everybody. Stu and I will be back with our next guest. We're live this is theCUBE SiliconANGLE's flagship production from .NEXT in Vegas. Be right back.

(uplifting music) >> Hi, I'm Stu Miniman and this is a CUBEConversation at SiliconANGLE's, Palo Alto studio, happy to welcome to the program, a first time guest and and new to Nutanix, the Chief Marketing Officer, Ben Gibson. Ben, thank you so much for joining us. >> Stu thanks for having me here. I love the studio and love the chance to chat with you. >> Alright, so our audience know Nutanix really well, so let's introduce them to you first of all. Give our audience a little bit about your background and, you know, we know Nutanix IPO'd not that long ago. Exciting. Growing real fast so, you know, I'm sure it makes sense but why for Ben? >> Yeah. For me, firs and foremost, it's such an exciting company. We're going through a lot of fairly strong growth right now. We've really created a category in the Space Realm Hyperconvergence and now we're really expanding from that position and to be in the middle of that, I think is really exciting. >> So your background is mostly in the networking space and it's one of those things, I'm a networking guy by background. >> Yeah. >> Networking is changing a lot, lately, but not nearly as fast as some of the other parts so, you know, tell us a little bit about your background, where you've been, what your skillset is going to bring to Nutanix, in that ecosystem. >> Yeah, you know, I did, like you, I hailed from the networking industry. I spent a good portion of my career at Sisco, I spent part of my career at Aruba Networks, which is in the Wi-Fi, wireless space, but I think you're right. I think the acceleration of innovation in Nutanix's industry a lot of stuff has changed so quickly in that space, so networking hasn't quite kept up with that level of change of things and for me it's kind of getting on a much faster train and moving forward with it. >> Alright, so we've had theCUBE at every single one of the DotNext conferences >> Ben: Thank you. >> They're fun. Your predecessor Howard Ting had a certain flair so let's talk a little bit about the show and, you know are there things that your going to be putting your stamp on at this show, coming up in New Orleans? >> Yeah, I mean first of all it great to succeed Howard, in the role. I used to be an advisor for the company and so Howard and I used to have periodic pancake breakfasts and I told him what I thought and he shared with me a lot about how exciting things were. What was happening at Nutanix and how they really move forward. And I knew about DotNext, I've seen DotNext I know what an exciting show it is. For a company like Nutanix to draw, this year, over 5000, attendees to this show, that's notable. And, what, to me, that signals is the level of intensity and the level of loyalty that we enjoy in our customer base, they're believers and they're coming to the show to learn from us, to connect with each other and really to accelerate some of their plans on how they continue to innovate. >> Yeah, you know, we travel to so many different shows and absolutely, it is at it's core, it's a user conference, it's users there wanting to learn how to use what they have even better. Learn about the cool net technologies. Dave Valente and I have talked about Nutanix is up there with companies like Service Now, that have, just, people that come and are just, you know, kind of fanatically supported. It reminds me of, you know, Vmware's a great company, doing well today. Many years ago everybody had the I love VMware bumper stickers. Vmware is a great show. We'll be there this year >> Ben: Yeah, so will we. >> And your company will too, so ah, what, what do people what brings them to that show from your standpoint and give us a little insight as to, kind of, some of the special things they'll be seeing this year in New Orleans. >> Yeah, you know, I think one of the biggest attractions of coming to this show is if you think about the role of an infrastructure professional, someone who's looking at hybrid Cloud environments and how do you manage those. Thinking about what applications run on what cloud platform. There's a lot of change and fluidity to that and I think the nature or the role of an IT or an Infrastructure professional is changing. Server Store J-Admin is quickly evolving because that's converging, just like the technology has and so, for me this show is about how do you get ahead of those trends. How do you position yourself to be as strategic as possible, within your own organization? And that's the way I like to think of Dotnext, it's a place that a professional can come to learn and to grow their career and their technology expertise. >> Yeah it's a great point, one of the things I've loved on theCUBE is there are speakers that aren't just from the tech industry, so everyone from Deepak Malhotra, who is from Harvard, um, thought leaders in the space to onstage at one of the shows it was David Blaine doing a magic trick while one of your engineers was configuring stuff. So there's some great speakers that'll be at the event this year to, not only learn the tech but as you said, you're thinking about the persons career and how do they embrace change and how do they help become more valuable to their company. >> Yeah, you know, there's two in particular that are going to be joining this year that I'm very excited about. One is Dr. Brene Brown. If you haven't seen her TED talk on YouTube I highly recommend you go and check it out. It's something different. It's about how do you be vulnerable, with yourself, with your career. How do you take chances? How do you take risk, and that's a lot of what's going on in our in our industry right now. The second one I think is going to be really fun and that's Anthony Bourdain. Known for his show, Parts Unknown and he's going to have colorful language, right, noted, some colorful language but also he's just a riot. He's the one I think is going to bring his special kind of flair to the show and get everyone really excited, laughing and maybe a little bit of gasping, in terms of what he's going to be sharing with us. >> Yeah, absolutely I mean, New Orleans is a great culinary destination and so I know everybody that's going there you'll want to check out the music, the culture and a lot going in there. So, excited about the show. We're going to have theCUBE there for two days. Last thing I want to talk to you about, Ben, just, Nutanix as a company, when I registered for the show there was one of the questions I thought was pretty interesting. They said, "What do you think Nutanix is?" You know, how do you, what's your relationship with Nutanix? And I'm trying to remember, I know one of the options was M: Is Nutanix a hypercovergence infrastructure player? Are they a cloud player? I think storage might even be in there, it's been one of those things as to, who is Nutanix? What are you today and what do you want to be in the next phase of growth? >> You know, it's a great question Stu, "Who is Nutanix?" We are focused on helping our customers build their enterprise cloud. Our taglines could be Your Enterprise Cloud. Enterprise Cloud is not only how you modernize your own data center but it's also, how do you embrace? How do you have a strategy? How do you govern? How do you bring together the right workload, for the right cloud platform at the right time? And that's the direction we're taking with our innovation. This is what more and more of our customers are looking to do. Not every application's going to a public cloud provider. Not every application is staying on premise. We're going to be living in the hybrid world, Enterprise Cloud is about how do you take the ingredients of hyperconvergent infrastructure? Take the ingredients for automation and management, over these different workloads, across these different environments and do so in a way that makes the complexity of infrastructure and multiple cloud management and make that all invisible. So for us that's our mission. It's building that Enterprise Cloud and making all that complexity go away. And that's the vision we're going to be talking about and that's what we think our attendees are really looking to get the guidance and, kind of the vision of how they move their careers forward and flourish in that space >> Ben, it's the barometer that I've been using for probably the last two years. If I spend a lot more time in kind of the Dev/Op Cloud native, you know, worlds these days. We were at an Amazon summit yesterday but, absolutely. It's heterogeneous world. IT has never, you know, let's throw out the old and start the new. Sure there's some new companies that might do that but it's a heterogeneous world, it's a multi-cloud world and big struggle for people is how do they get their arms around it? So if I look at a company that has started mostly on premises, it's like, oh how are you evolving? How are you working with the public Cloud? You know, Nutanix has been working very closely with Google over the last year or so. A new acquisition recently that I know plays into this whole story. Tell us a little bit about the acquisition and, you know, how does Nutanix look at itself, which is now, I mean, if you read the Wall Street reports, Nutanix is a software company. And you're getting great multiples on that and it's helping and you know I've been pretty vocal on this from it's early days, is Nutanix was never a hardware company. It, you know, building an appliance was a go to market choice to simplify and make it easy for customers but as the company matured, >> Yep. >> It made a lot more options and today it makes perfect sense that really software is where it goes, so you talked about a bunch of things there but specifically, kind of the multi-cloud and the acquisition first. >> You know Stu, we're really excited about this recent acquisition we made. It's a company called Minjar and the offering is essentially it's going to be integrated into our broader software platform, that allows customers to be able to assess on a realtime basis. What's the right Cloud platform for a particular workload from a costing perspective? From reliability standpoint. Derish talks about the law of the land. The laws of physics and the like, you need to apply these all to determine what you're going to run where. And what we got with this Minjar acquisition, is a really sophisticated way that our customers can embrace and is part of their enterprise cloud. Because part of this is taking back control over all this disaggregation of workloads running everywhere. You're losing control. Losing governance of your data and your applications if you don't really keep on top of it, this acquisition, I believe, is going to be a really key part of helping IT organizations regain that control. Yet still enjoy all the benefits of hybrid-cloud environments. Whether it be with an AWS an Azure a Google Cloud platform, like we're partnering very closely with, as well as what they're building with their Enterprise Cloud on premise. Whether it be, you know, with Nutanix. >> Yeah, it reminds me of, was it Progressive Insurance, I think has the, you know >> Yeah. >> We're going to give you quote on all of the things there. Cloud is complicated these days. Is there bias towards it, pushing towards, you know, Nutanix closer partners in the technology itself. >> Yeah, I mean it certainly has. There's a lot of complexity around that and to me the industry hasn't solved a lot of new complexity that has come out of the emerging trend of a different line of businesses starting to develop a new application now, on a certain Cloud platform and the like. And as you're seeing this demand for more application mobility between clouds, so all of a sudden the partners that are coming to us and the partners we're seeing and are demanded of that we work with in the market our players are looking at application automation. Players that are looking at dev/ops tools and the like and it both guides how we innovate on our Calm platform, which we introduced last year at DotNext as well it helps us expand our reach. So, we talked to our traditional buyers but there's a lot of new buyers now that are building those apps and managing those environments and we're going to start to see some of those come into the DotNext show. >> Alright. Ben I want to give you the final word. DotNext is one of the many events that I know you do lots of regional shows and the like, what should we expect to see from Nutanix through 2018? >> Yeah, you know the first thing is that the dialogue, the narrative for the company, that we're going out with we've moved to be a software only company and I think our customers tell us and I heard this from one of our largest retail industry customers just a few weeks ago, by moving to a software only model, it's given them freedom to take advantage of Nutanix, regardless of their hardware platforms. And like you said we've never been a hardware company, it's all been about software value and what you're going to see from us is a new narrative. An expansion of the branded Nutanix talking about the freedom we give for customers to build the data center they've always wanted to build. Freedom to run their application or the workload that they've wanted to run, where they choose to run it based on that insight I talked about. And in another realm, the freedom to play. Freedom to get their weekends back. A lot of our value proposition is because of all the complexity we've taken out of the equation, is that we give our customers their weekends back. This is a story that our DotNext attendees, I think, know better than other but we want to spread the word and so part of that is harnessing that freedom concept to build, to run, to play to invent and tell the world. And DotNext, whether is be in New Orleans, which I think is going to be a blast. When we take it to Europe, London and we do this all around the world, to me that's kind of ground zero for that story. For the community of what we've built together with our customers and partners and that what we take out to the world. >> Alright, well Ben Gibson, I'm glad we could introduce you to our community today because we're going to be seeing you at lots of other events, you and your team, of course, theCUBE will be at Nutanix, DotNext in New Orleans. Nutanix and you will be at Dell Technologies World in Las Vegas. Google Cloud Next happening this summer in San Fransisco. Lots of other shows so be sure to tune in to theCUBE.net, get the list of all the upcoming shows, Ben, Nutanix and of course lots of the Cloud and infrastructure ecosystem. Check it all out. I'm Stu Miniman and thanks for watching theCUBE. (uplifting music)

[Announcer] - Live from Washington D.C., it's theCUBE, covering .NEXT Conference brought to you by Nutanix. >> We're back in D.C., welcome to NextConf, this is day two of our wall-to-wall coverage and this is theCUBE, the leader in live tech coverage. My name is Dave Vellante with Stu Miniman. Dheeraj Pandey is here, he's the chairman and CEO of Nutanix. Long time CUBE alum. Great to see you again. >> Pleasure. >> So you know, I love your style, up on stage yesterday. Very philosophical, always have been humble. You sort of said, "I'm going to stay humble," and it appears that's the case. But yet, there's so much excitement around here, you have a lot to be very proud of. How do you feel? >> You know, there's no finish line in this company building, just like there's no finish line when you have a family, it never ends actually. Nutanix is a family, and we are trying to make it a bigger, happier family with more customers, more partners, more employees. I feel good, but I think this company is good right now, it's not a great company. We probably will have to spend another decade to make it a great company actually, so. >> How do you, as the chairman and CEO, how do you define "great company"? >> Great companies, for one, actually take really good care of their stakeholders. You think about employees and customers and partners and also Wall Street, so I think at the end of the day we have barely begun the journey in some of these things. Customers, sure, we have quite a few of them, but I think we can do so much more for them. At some level, even in the largest accounts, we're barely scratching the surface actually. Same thing with employees, you know, we have almost 3000 employees but still, we could do so much more for them as well in terms of wealth creation, in terms of building careers. Very early days. Same thing with Wall Street as well, very early days actually. >> Dheeraj, you're always opening to listening to feedback, but you mentioned, you've now got a lot of constituencies. I know I've interviewed you and said well you know, there's the 90-day shock clock but, we can't get distracted, we need to focus. How do you, you know, what is the filter, how do you, what do you take in and internalize to translate into the direction of the company? >> You know I talk about two things. There's delight, there's waste. Delight for main street and make sure you're cognizant of the waste with Wall Street, because if you keep growing they won't bother you. What they bother you with is waste. How are you growing, what does efficiency look like at scale? So I just learn "growth at any cost". I think these are all timely reminders for any company, so that it doesn't get too painful when recessions hit you, because there's highs and lows of any company that you have to go through. So I believe that waste is the larger ego of delight, and if you can do a really good job of delighting our customers, our partners, our employees and then figure out how to deal with all of this with waste in mind, I think we'll do a pretty good job. So what matters the most is delight, but not without figuring out what's waste-like. I think you have to keep looking at these "KPIs" and say how are we really doing at scale with respect to distribution, marketing, product development, product engineering. Now we have a pretty large engineering workforce as well. How can the company be delightful for them if you don't have "two-pizza teams", if you don't have APIs and microservices in which they actually talk to each other, still feel like they're the CTO of their company, because they all want to make independent decisions and design trade-offs and things of that nature. I think we talk about this thing which is a really important abstract thing, it's called the paradox of growth. I learned this from some of these folks who have done this book called The Founder's Mentality. Growth creates complexity and complexity kills growth, so just be aware of what you really vied for can kill you as well, and continue to release complexity to organizations in the way you deal with your customers, and I think those are the things that really matter. I look at employees as customers, I look at customers as customers, I look at partners as customers. If you have the customer-centric view, you'll probably continue to simplify things under the cover. >> One of the things that you see in great companies is early on they're able to articulate a vision, see that vision, execute on it obviously and continue to grow their team, I mean that's a big part of your job. You've dramatically, well first of all, the team that you started with was quite large. Cloud expands that enormously. So maybe talk about your vision and how you're seeing that through. >> Well I think from very early on, the mission was invisible infrastructure. And that is an infinite mission because again, no finish line actually. You can make things invisible and then probably say we still aren't invisible enough and you have to make it more invisible. When you have downer to four clicks you have to say how about three and two and one click? And finally get rid of the click because machine learning can come in and automate more things as well. So how more and more things go from humans to machines and how the human-man-machine interface becomes less frictioned is the vision of this company. Now, all of this is not just graphical UI because the systems have to work, they have to be scalable, stable, reliable, available. So the back-end has to be very robust but then without a front-end it's really the same as a man-machine interface. Also the machine-machine interface, because APIs match for a lot as well, you know. If you're only thinking about man-machine, then you've lost a lot of this automation and machine learning capability as well, actually. >> I think back to some of our earliest conversations, you always talked about Nutanix is a software company and the challenge of our day is building distributed systems. The tooling and the way we build things today are very different from when you started the company. If you were starting from a bare sheet today, would you be born in the cloud, you know, how would things like containers and microservices change the way, or, and how are you taking from where you are today, which it started out in virtualization, is that a core, you've got AHV driving a lot of the pieces, versus some of those who are models? >> Yeah, I mean, look, VMware was building an operating system, but they needed a shield of EMC to go sell and distribute that. We had the compute virtualization piece that came a little bit later, but the storage virtualization, the control plane pieces, we needed to shield them, and we shield them in appliance, and that became our form factor the could give us the control of our own destiny, and that's what the appliance did to us. But you always knew you were building software, actually. And many people told us early on, just don't build appliances at all, and we would've been killed, we probably would have to sell this company early on, because it's really hard to build an OS company early on when you don't have a brand and nobody's willing to support you and customers are like, you know, if nobody else is willing to support you, how do you really build an operating system, actually? So I think if there's a method to the madness, we always knew we had to be hardware-agnostic, that's why we never built NVRAMs and FBGAs and things like that. And over time when Dell came forward and said look, you should OEM your product, I think it was a very natural decision for us two and a half, three years ago. I think there's been this controlled release of goodness of this operating system that basically not mean like oh we never thought about it, we always thought about hardware-agnosticism, hypervisor-agnosticism, all those things were there from day one in this company. But you know the question of whether we would start in the cloud today? Honestly, all companies have to start where they are in order to make money, and continue to navigate the shifting sands of time actually. I mean, you sell books, then realize it's not good enough, you go and sell, you know goods with e-commerce, and that's not good enough, you sell computing. We started an office productivity company, go and do a desktop operating system, then you go and do databases and server operating system and then all sorts of things for the family room and so on and then finally do a cloud. I think there's no, you know, change is the only constant you know, if you were to think about it, and companies that actually survive and thrive, they start someplace, and their thing, every three, four years, you just find the adjacencies, and keep navigating, you know, how the market is actually shifting and changing. >> There's a strange aura around your company. Now maybe it's the allure of the product, I don't know, but you have a lot of companies now coming into this ecosystem. We have Chad on next from Dell EMC, you know, arguably one of your larger competitors, okay, but they're here and they're happy to be here. So, it's, I say, maybe it's product, but it's also part cultural. And I'm guessing that your philosophy is it can't be a zero sum game. It's got to be a win-win for the partner, so I wonder if you could add any color to that. >> Yeah, that's a great point by the way, bring up this idea that you can be all things to all people. Somebody asked me in this analyst meetup, how about just go and build a firewall? We can, there's too deep a space in there for us to go build everything, so we need to have open APIs, where others also make money. And by the way, when you have a really flourishing ecosystem, the word of mouth, that they're also making money, the word builds a larger ecosystem, a larger operating system and so on. That's what Apple 2.0 was, because in 1.0 they were all about it's me, it's mine, no one else can do anything, and then they saw Microsoft, and how it was really building this burgeoning ecosystem with APIs, APIs, and more APIs. 90 was Microsoft's decade because of APIs actually, and partners and ecosystems, and Apple learned from them by the way, so when they came out and said we built a device, they said no no no, we've also got to build iTunes, because that's ecosystem, and then they built iCloud and app store and things like that. So I think there are lessons galore in the last 20, 25 years where if you're not a good API-driven company, you're probably not a long-lasting company actually. And the idea of a platform is incomplete without those APIs and the ecosystem itself. >> There's a change in accountant coming which is going to make you, I guess, to restate the software that you've sold through the OEMs will probably have Wall Street look at you a little bit differently. We've talked in the past before about how much you want to sell as Nutanix, how much you want to sell with partners. What's that mix that you see today going forward? How much of your product will you see, hardware, software, services, what's a good mix for you? >> Yeah, I think it's a, it's a good opportunity for the company to really think about revenue 2.0, because revenue 1.0 was what we had sort of planned out four, five years ago and 2.0 is a time when we have different form factors. We have ELAs that we started doing in the last 12 months. We're selling software in CISCO and now software in HP. Obviously Zai will happen in subscription as well. Now we have markable routes to market, you know, obviously the OEMs have actually matured, both OEMs have matured. So the question is of how do we really make it simple one more time? Because obviously there's more routes to market, so as a company we're saying now we can sell more software, and with a new accounting change, which is called ASC 606, software will have to be recognized in the same quarter, we can't defer it arbitrarily. And in some ways it's a good thing, in some ways it's bad because it takes away our goodness of the waterfall, because we could have deferred more revenue, as a company we've deferred a lot, I mean, folks know we have about $465,000,000 of deferred revenue right now, because of how good we were in actually postponing this instant gratification of cutted quarter and so on. So I think some of that will have to be brought into the current quarter but in some sense it's a good thing because we can then take the gross margin of that software and sell more appliances, so I think there's some mixing that'll happen with different margin profiles that'll have to come and kind of work with each other to say can we still grow as a company beyond a billion. >> But these are income statement gymnastics, not that you're playing, but that you're able to- >> Well, there's something about guard rails of the gross margin, because Amazon, what did Amazon say, look, your gross margin, my opportunity, right? So if you just let unbridled software go and sell itself, then our gross margins will be starting to creep up, but what if you kept it within the guard rails of around 60%, and then went and sold more appliances, because the software gave us the luxury to buy growth? I think those are the kind of architectures we are actually looking at right now. >> And the knobs that you might choose to turn, but it will have an impact on the income statement from an operating profit standpoint, I mean, right? If you're going to recognize all that deferred revenue up front you know- >> Just in subscription, we can actually do one-year terms and things like that, but obviously we don't want to completely throw the baby out of the bathwater, because a lot of subscription is a good thing, and Zai will provide subscription. Hopefully as we do this Cisco and HP on software, we can do one-year terms. >> It doesn't seem like these are distractions to you, I mean, Michael Dell always talks about the 90-day shock clock. With you, you sat down with Stu after the IPO, I was struck by your comments of "look, I'm not going to get all wound up about the stock price", you know, you're not going to obsess over it. Now it's easy not to obsess when you're growing at 60, 65% a year, but it doesn't seem like it's been a big distraction for you. >> Yeah, I think it's, just like a growing customer base can be a distraction, can be a strength, you know, because you could say, well, they're asking me not to innovate at all, and have the brute force figure out a way to have velocity and quality, because existing customers want quality, because they don't know what else you can be, like, give me a faster horse, right? And then you know from within the area we innovate that's where velocity matters. Same thing is true for Wall Street as well. Main Street wants both, Wall Street is saying look, as long as you can keep growing and grow wisely, I'm not going to touch you, actually. >> I want to ask you about your customers. We've had some great customers on. Most of the customers I've talked to that are Nutanix are what I'd call, you know, they're in the early part of the adoption, they're people that, they're taking some risks, we heard NASDAQ talk you know, forget about the fear, you've got to go forward. As you grow, how do you stop, you know, the enterprise buyer from trying to shift you, change your model? I loved that you're doing things like, you know, many companies are trying to switch to, you know, consumption models to pay as you grow, but as you try to grow that customer base, how do you pull them ahead or how do they not, you know, hold you back? >> Well I think as long as we have an authentic product, customer service, sales motion relationship they'll like us. And I think obviously there are different kind of sub-functions in the customer itself like procurement versus ID versus the business user and so on, and it's a constant hussle, there's no, again way to say that it's going to be a perfect world one day. If you can keep building great products, have great customer service, and we know that our sales motion is easy because it can, it can be a really good product and have really good customer support, but customers might hate transacting with you. I think that's the last piece that matters, and I think as computing becomes a real consumer market, that's what's happening you know with cloud, you can go and buy a computer like the way you used to buy your toothpaste or mouthwash or shampoo. I think it's becoming even more customer-centric, even more customer service-focused and so on. So I think the changing landscape of computing keeps a lot of vendors honest actually. Now, that doesn't mean that everybody will innovate, enough of them will say look, I'm done, and I think one of the things we've done well in the last five years is that the thesis of the product market fit. Like well, we know this is the product direction, this is the vision of the company, it has actually stuck. You know, people have said "I like what you guys are saying," actually. Over and over and over again, I mean, combos and acquisition, people are like "I love this". HP was one of those really audacious ideas, people said "I love this, now that I see it, I love it, when I didn't see it, I was skeptical". So I think a lot of the thesis of the company around innovation have worked in our favor. I think if we keep having that luck with ourselves, good things will happen. >> So Dheeraj, your positioning of the company has usually been a little bit ahead of the market, you know, for years it was like, ah, what, that HEI thing is a niche, and it's not really much that different, oh, enterprise cloud is nothing more than, you know, kind of vapor you know, what are the misperceptions you see today that you'd want to clarify for the market as to who Nutanix is today and where you're going? >> Well the first one is that we are a hardware company, because we are a hardware company, even though we sell a lot of software within the hardware and obviously we do a lot more software these days. And the fact that HEI's the destination, where HEIs basically was a mere milestone like five years ago or something, you know, we talk about I'd say about five years ago imagine a lot of the competition is talking about SEI today, when people are saying the compute storage form factor is interesting but not that interesting because I need to figure out how to converge clouds now, not just converge devices within my data center, I need to figure out OPEX and CAPEX, how do I meld those things, how do I burst, and things like that, you know. So the story keeps evolving because the consumers, the customers, and the competitors continue to evolve the market as well actually. So I would say that people have to look at us as an OS company, and the more they try us the more they realize why we are an OS company. They look at our networking R&D, they look at our security pieces together, storage, hypervisor, and now Zai, I think, you know, good things will happen. >> I inferred from your keynote yesterday that you're on a mission to change the operating model. Certainly Amazon has changed the operating model as we well know and it's translated into their operating profit, you know, their marginal economics as we've talked about in the past are compelling, software-like for services. As you change that operate- first of all, did I get that right? Are you on that- >> I call it a consumption model. >> Consumption model, great. So where do you see that going for customers? They're obviously taking labor costs out, how far can they take that- how much can you sort of automate in that process for your own company, taking those labor costs out to drive your margin? >> I think again, now going back to this idea of invisible infrastructure, just like it has no finish line, automation has no finish line. We used to automate 50 years ago as well. Automation as a word has existed for 200 years you know, since the industrial revolution actually. So again, there's no finish line in automation, there's no finish line for what machines can do compared to humans and I think they've constantly evolved, I mean, 200 years ago we were primarily agrarian, we would do agriculture and nothing more, and today we are doing a lot more things with our brain and I think we're becoming a more evolved species actually. So I think as machines do more, humans will also figure out a way to continue to do higher level things, so I think the best part about this company is that what we have chosen has no end to it, and the more we think we automate, the more we'll have to automate some more actually. And not just within the realm of compute, virtualization, or storage or networking or security, but also migration, portability, you know, what does it mean to really look at things on and off premise and things like that, so a lot of work is around that. Application automation is a big part of it as well. >> When I hear you say there's no finish line, it reminds me of Jeff Bezos, he says, "there is no day two, we will always be in day one". The two concerns I have, that is, number one, you can't have your employees constantly be charging, you know they run to the point where they're going to burn out and I hear Amazon is a challenging company to work for. Secondly, every customer I talk to, like, boy, they can't keep up with the six week release cycles that are coming at that, you know, remember when it used to be 18 to 24 months, you know, that was nice, we could do upgrade cycles when we want. How do you internally and with customers manage that pace of change and avoid burnout or over-complicating the environment for your customers? >> That's a great point actually, because obviously, if you don't have delighted work, it's hard. For them right now their delight, for Amazon employees, it's stock pricing. That's the only delight they have. But I look at it as a marathon of strengths. You basically have to sprint, take some rest, like after this we'll rest a little, and then say let's go and do another sprint, because NIS is another sprint, you know, and then reading all this stuff is another sprint, so I think if we can keep looking at that, and plus even do a little bit of baton-passing that'll happen, you know, I think as a company, we were all in San Jose and now some of the baton has passed to Seattle, some of the baton has passed to RDP Durham and Bangalore. We build this distributed workforce where different teams are coming in and saying "now I can run with it as well", like Bangalore could not have run with this six, seven, eight years ago, because everything was here. You know, RDP and Seattle were too small for us so I think there's critical mass emerging where the overall morale of the workforce is actually just as good as it was like five, six, seven years ago. Now, people talk about burnout a lot, but I also believe that a lot of this is choice. People who are saying "I know how to blend work and life". It's becoming hybrid, there's no such thing as work separate, life separate, it's melding into each other right now, and it's really becoming like this where people who are working smarter saying "I can figure out what that means in terms of balance". And millenials are again one of those who were born with all these things from day one. So the devices have been with them from day one, actually. They're saying "well, I can't not interact with the machine some time or the other". So I think that a lot of this is evolution for us, I mean, the eight to five way of looking at work, which is "batch processing", is now becoming multitasking and so on, so what happened to operating systems 30, 40 years ago is what's happening to humans as well actually. >> You know, we're out of time, but I wanted to share with our audience, one of the unique things about this conference is that you have advisors. A lot of people hire McKinsey and it all stays, you know, behind closed doors. Condi Rice, Robert Gates, Stephen Hadley, Deepak Malhotra, these are advisors to your company and we've met them all, many have been on theCUBE. You share with your community, your advisors, and you put them in front of your community and it's great content. I've really not seen a company be that transparent with its advisors before. Deliberate? Just sort of happens? >> It's always been like that actually, you know because the more a company learns from them, honestly, the more we've gotten out of them in turns of ROI, if you just think of it from a left wing point of view, but the right wing is that people want to build careers, not just wealth, they want to build careers, they want to actually be with folks that they can look up to you know, when the going gets tough. How do you remember somebody's words? Not just in books, but you know, in flesh and blood, you're like, wow, I talked to Condi Rice, I talked to Bob Gates, I talked to Steve Hadley, these people told me exactly what they went through, and I think there's no substitute to experience actually. To me, people like Mark Templeton and Frank Slootman, they all are great sources of energy and aspiration and ambition as well. >> Outstanding. >> No compression I've heard on experience, right Dave? >> That's right. Dheeraj, I feel calm just hanging out with you here, so thanks very much for coming back on theCUBE, it's always a pleasure to see you, and thanks for having us. Alright, keep it right there everybody, Stu and I will be back with our next guest. We're live from .Next, be right back. (electronic music)

>> Announcer: Live from Washington DC it's The Cube. Covering .NEXT Conference. Brought to you by Nutanix. >> Good morning everybody. In 2009, infrastructure professionals, and the vendors who supplied products to them, started to realize that the cloud was real. They began to try to replicate that cloud on site. The first instantiation was what we call converged infrastructure. Converged infrastructure was essentially the combination of storage, server, and networking kind of bolted on together but prepackaged, pretested, and engineered to be installed and delivered in a more seamless fashion to minimize the amount of labor that had to go into the management of infrastructure. That was around 2009 and in that same year, Nutanix was born with a slightly different vision, to actually develop a solution that was truly cloud-like for on prem. Welcome everybody to Nutanix .NEXT 2017. This is The Cube, the leader, in live tech coverage. My name is Dave Vellante and I'm here with Stu Miniman from SiliconANGLE Wikibon, who is an expert on Nutanix, on hyper-converged infrastructure, which was the next instantiation of converged infrastructure. And now, Stu, we see this going into the cloud era. Nutanix is a company that's probably going to do close to a billion dollars this year, if not a billion. They got a two and a half billion dollar market cap. They got a gross margin model in the high fifties. They're growing at 65, 66% per year. The stock, when they did their IPO, was a meteoric rise, sort of flattened out since. It's up today, on some news that was broken by CNBC. They're doing a deal with Google. This is our, let's see, fourth? Third or fourth .NEXT >> Third year of the US show, The fourth >> Fourth overall. >> Nutanix conference overall >> we did some in Europe. >> Stu, great to be working with you. We've been together a lot this month at a number of shows. This is sort of the capstone of what we call true private cloud and a great instantiation and example of it. What are your thoughts, early thoughts, on what to hear. >> Steve, great to be with you as always, and excited to be here at this show. One of the things I love in our role as analysts is when you see something in some of the early stages. So, I first got introduced to Nutanix when they were about 20 people. Little bit smaller than say, when I first met VMware, when they were about 100 people. And to watch this company and this wave grow I remember John Furrier and I interviewed Dheeraj, CEO of Nutanix, back at VMworld 2012. And, right, infrastructure and converged infrastructure, I mean, I worked on some of the original Vblock architectures when I worked at EMC, and we're saying "Take my storage, take my network, "take my compute, put 'em together, "package 'em, integrate 'em, try to make it simpler." But when we talked to Dheeraj, it wasn't about the infrastructure, he really posited that the challenge of our day is building distributed systems, and it's really a software challenge, and that is at the core of what Nutanix's IP, what their engineering mentality is, and they've kept that going forward. We always talk about, oh, okay, in our infrastructure silos, Nutanix's vision from day one was to go beyond that, we talk about hybrid cloud or multicloud, today, that's what Nutanix is starting to deliver in their vision. When they first launched themselves as an enterprise cloud, as their marketing, everybody was like "What are you talking about? They're an HCI player, what's their cloud mission?" Making an announcement with Google shows that they are going to have some partnerships there to live in that hybrid or multicloud world. And Dave, I want to clarify, when I You know, we throw around these terms, hybrid and multi for me these days, I look at it as, hybrid is a lot of what I know you used to call federated, so how do I have a model that really looks the same whether that's just the application layer or even going down to the infrastructure layer, spreading between environments, typically my private cloud and my public cloud service writers can be in the mix there, multicloud means I've got data and I've got applications that are going to live in multiple public clouds in multiple data centers, of course we've got SaaS, so that differentiates a little differently. Things like Kubernetes are really helping that explosion and that discussion of multicloud, kind of replacing what we used to talk, with PAS, the platform as the service, where I could really be independent of the cloud, so there's a lot of nuance and detail which I'm looking forward to digging into. >> It's nuance >> Over the next two days >> But it's important nuance, because basically you're saying it's not just a bunch of hybrid, it's not just a bunch of clouds, >> Stu: Yeah. >> It's some kind of federated >> Stu: Yeah, we had >> It's a data plane and a control plane that spans multiple physical locations, essentially. >> Yeah, I worry about things like identity, I worry about things as to how to security SPAN these environments, governance of course plays in a lot, but I'm sure we'll hear things about consumption model because one of the things cloud consumption model used to be like, oh well some business guy just swipes a credit card and goes and does it, well shouldn't all infrastructure be as easy to buy as we did, I mean, you remember a decade ago we always talked about the consumerization of IT, now it's really that cloudification of IT with companies like Amazon really driving forth the model that everyone wants to copy. >> So since we've started researching Nutanix and talking to some of it's customers two years ago at the initial .NEXT conference, at the Fontainebleau in Miami. Really talked to a number of customers and you could see the enthusiasm for simplicity, you could see the desire to reduce their reliance of VMware and the vTax that was hanging over their heads, and at that time, a couple years ago Nutanix introduced Acropolis, which is essentially a hypervisor inside of what they call now the cloud operating system. But that is a strategic move by a company that's basically saying, "hey, we're not just hyper converged, "cause everybody's now pivoting "to hyper converged, we're cloud," so it's a message to the financial world, to the industry analysts, and to customers that, we have a vision and to the financial world, we have a large TAM. Financial guys are more worried about, they're always worried about TAM expansion, that's their TAM expansion plane. Now, bringing it back to some of their financials, just briefly, Nutanix essentially loses 37 cents from an operating basis, on every dollar of revenue it makes. Okay, that's I guess in vogue these days, but it's funny accounting, because they don't recognize the full value of their OEM deals, like the Dell deal, again some nuance, and there are some accounting changes that are occurring which should be a tailwind for this company from just from the optics of the income statement. So you're going to see, and I think the street's finally starting to understand this, again, stocks up today on the Google news, there's no press release yet, but CNBC broke that news, what do we know about that? >> Yeah, so first of all, right. The accounting changes coming this summer, if I remember right, I believe it's August, >> Dave: Yep. >> So that means that rather than taking the three year subscription and only taking a small piece of that today and pushing most of it out into the future, there will be a restatement of all of Nutanix's number, which, right, will be a tailwind as you said and push all that in. Google, number one, is you look at one of the most interesting dynamics of Nutanix is, been the relationship with VMware. I did an interview with Dheeraj right after the IPO, I was at the headquarters, sitting with him in this beautiful library that they have there, and he turns to me and he's like, you know, on camera, he says, "Stu, if VMware hadn't been so negative on us, and not allowing us to OEM or ship their product, I don't know if we would have launched our own hypervisor." It was not an initial plan. It was something that he's talked to the analyst community and said, this is something that was not simple, it was not something that was done lightly, it was something that, their hand was really forced because customers say, "I want the simplicity, "I want to be able to just stand it up, "I need that to come pre installed," and there was additional value that Nutanix felt they could bring. The DNA that they had, as they said, from companies like Facebook, from Google, and the like, where they understand the underlying code that they need to build to be able to build this distributor architecture. So, building off of KVM, they built the Acropolis hypervisor. One of the next big shifts coming is containerization, and this is where Google fits in. They should be able to accelerate that move, which is the thing I worried about with hyper converged, is we took our virtualized SAN environment and we just put them in slightly different form factor. It's simpler, yes, it's great, it's going to be, hopefully, a better economic environment, but how do we move the company forward faster? Two years ago, the customers were really excited cause they said, "I got my weekends back." What you want from an IT department is not to say, "hey, I'm no longer just overworked," but "I'm driving the business forward." But Dave, you've always said the role of the CIO is not just to maintain the business, but to transform and grow the business. So that's where we need things like containerization to help companies be more agile and move faster, and to have IT turn into a force that can help code, create new business lines, leverage our data more. The thing that we've heard at every storage show we've been at recently, Dave, is, NetApp actually say that "storing is boring" and that is something that we hear, is "I need to leverage our data, "we need to get it out there" and that's what I'm looking for this week, is to hear more of that cloud native piece. I was at the Cloud Foundry Summit a couple weeks ago, I can sit that on top of Nutanix. So how does partnerships like Google and some of these environments help with application modernization, analytics where I can get new, you know, take my data and create new business value, cause that's where we're going to really transform and grow companies into new revenue streams, and Nutanix is a platform to help deliver on that. >> So, Stu, since the spring when we released our latest true private cloud report, the Wikibon team, there's been a lot of talk about that report, it's implications, we had, there was a blog post today from Yaron Haviv at Iguazio saying, "you guys needs to rethink your definition of true private cloud, because the on prem guys have no chance against the cloud guys," we don't agree with that, by the way. But the notion of true private cloud, is this this on prem infrastructure that substantially mimics the public cloud, and as I said before, has a control plane that spans multiple physical locations. That's a concept that we've kind of put forth, and started to quantify, because there was so much cloud washing going on. And it really is, frankly, the savior of the existing infrastructure guys, or could be. Because their legacy business is not growing, in fact it's declining, and this is a very high growth market opportunity for these folks. So, my question to you is, can Nutanix participate in that high growth market? You know, there seems to be an aspiration, maybe I'm overstating this, but to be the next VMware, of sorts. >> Stu: Yeah, no, no. >> Can they do it? >> Exactly, and Dave you're not overstating it, I've heard people from Nutanix say that was their target. Their target wasn't to replace a flexpod, their overall vision was right, to be the next VMware. They want to be a platform to be able to grow on that. And the thing I've been looking at, at every show when we go to infrastructures, how do you live in that multicloud world? Because, you can't put blinders on and say, "Right, well, Amazon's in a corner." No, we know Amazon customers are using them. Right, as you said, Dave, I want that operational model in my own environment to build what we called a true private cloud, absolutely Nutanix is a player there. There's still work to be done for all of these infrastructure players, but what are they doing? How does their control plane span beyond that? And why should Nutanix be more than just a piece of the infrastructure? Because, there are lots and lots of players, not only the infrastructure players, lots of software companies, and the cloud companies themselves, that are going to say "I'm going to own that piece." I mean, Microsoft, identity is one of their greatest strengths. Google and Amazon, have been going after that, I mean, Amazon's eating everything, Dave. So, why should Nutanix not just eat some of the old guys, but be a player that lasts into the new world? Is looking forward to the announcements later tonight, we've got a lot of their partners and customers on here to be able to deliver proof points. And Nutanix is still growing, still doing real well, and you know, exciting stuff. >> Yeah, so we're going to be covering this, wall to wall coverage of two days. We've got some great outside guests coming in, we got Diane Greene's speaking at this event, Bill McDurmott's speaking at the event, and word is Peter McKay from Veeam is going to make another appearance, he's like The Cube, he's everywhere. (Stu chuckles) And then some really interesting outside speakers. Malhotra is here again, so really excellent line up that we have for you guys this week, two days, wall to wall coverage, this is The Cube, we'll be back from the district, live in Washington, D.C., this is Nutanix .NEXT. Be right back. (relaxed futuristic music) >> Announcer: Robert Herjavec