In what has been a tough year, Lenovo has made significant progress, and has made huge inroads by riding the huge wave of cloud adoption in India. Vivek Sharma, MD – India, Lenovo Infrastructure Solutions Group (ISG), shares his perspective on the company’s 3S strategy and future outlook in an exclusive interview with Sandhya Michu from CRN India
Some edited excerpts:
In this tough year, how has the business grown for Lenovo?
It has been an eventful year. From a perspective of our overall results, Q2 was the largest quarter and then, subsequently Q3 became a largest quarter for us. For us, business from the first three quarter perspective was good, against all three business lines across IDG, which constitutes PCSD and the mobility business, and ISG what was erstwhile DCG. We got renamed from the Data Center Group to the Infrastructure Solutions Group.
What does the new positioning mean for the company?
Our earlier brand name, data center business or a data center group, there was a common perception that we are a data center farm or in colocation business. We provide infrastructure solutions across big and small businesses, as well as some of the world’s biggest cloud service providers. Our competency is high performing and reliable server storage systems that bring technology from various partners, from Intel to AMD, Nvidia, Nutanix, VMware, Microsoft, etc. that enables us to custom build capability of building solutions for customers. Hence the change of name from DCG to infrastructure solutions. Lenovo has made significant progress over the last few years in service led transformation. This is the right time to structure our business in a way that accelerates that growth even further.
Our GTM from an ISG perspective remains the same. Our strategy across all segments of Lenovo, that is Intelligent Devices Group (IDG), Infrastructure Solutions Group (ISG) and Solutions Service Group (SSG) presents a one Lenovo story and balances our capabilities.
We always have worked with a 3S strategy – Smart IoT, Smart Infrastructure and Smart Vertical. Smart IoT becomes the essential tissue for the connected world. With Smart Infrastructure, Lenovo ISG provides computing, storage, networking, software power to support this intelligence. Lastly, Smart Verticals are those that can be customised with Smart IoT and powered with Smart infrastructure. This takes us towards an intelligent transformation where devices and data center infrastructure work together to create a wholistic solution.
Will renaming ISG will bring a change/refinement in your channel strategy?
We work with multiple stakeholders and 95% of our business comes from the channel. We have strong relationships with customer system integrators, vendors, etc. A unique channel first business mantra ensures that we have the right skills and competencies to deliver. Channel is at the core of what we do. This also means providing a seamless experience to our partners as well.
We are doing this through our Lenovo Partner Hub, which is our global partner portal that provides a unified, personalized, and consistent experience to our partners. The Hub provides partners with a single access point to relevant tools and resources, as well as intelligent and personalized information that is most relevant to their role, geographical market, and past engagement. It gives them a snapshot of their sales performance KPIs on their homepage. It also gives them a comprehensive product catalogue to develop expertise around our product solutions and services and access to latest market trends and industry insights. For us, channel has always been and will continue to be a critical part of how consumers consume our services and how we deliver to them.
How has the pandemic impacted your firm, and what are some of the significant trends that you have observed?
The hybrid models are here to stay because I don’t think we will completely shift to a work from home environment. It really won’t work like that and there are cultural issues from a perspective of how organizations look at it. But yes, it definitely will change the way we work. The employees will have more freedom from where they want to work from. The way our offices used to look will also change. However, what that presents is a great opportunity from a technology perspective on the changes that have already happened and the changes which are coming. In fact, when we did a survey of our customers, with the enterprise side specifically, almost 67% of them said that digital transformation accelerated within their organization. Now, digital transformation can mean different things to different verticals. And the challenge that they see or the concern that they had to address was the employee experience as they work from home.
This show that there has been an acceleration for both cloud and hybrid solutions. For example, software defined infrastructure or hyper converged infrastructure solutions have seen greater demand as organisations realize that the hybrid structure is here to stay. Hybrid solutions or SDI/cloud computing has got a big thrust because you moved quickly to the public cloud in the wake of the pandemic but are now looking at software defined infrastructures to build a long-term solution and address issues of compliance and security. When it comes to remote working and to the hybrid workplaces now, VDI or the virtual desktop infrastructure solutions are already resonating. There will be even more expansion as we go into this further.
From our perspective, we are uniquely positioned there because we have offerings that spans across Nutanix, VMware and Microsoft, an entire stack of ThinkAgile series.
Are you increasing the product positioning or the product portfolio you are looking for this year? What are you bringing for customers in terms of innovation?
We have recently launched, the industrial system and hyper converged infrastructure solutions. These are customized hybrid cloud solutions to help organizations of all sizes. It is from a perspective of pay as you grow, so businesses can start small and grow large and that’s the benefit of our HCI solutions. We have become a single stop shop from a perspective of support to both our partners and customers. Apart from SDI, Lenovo today carries the number one position on the top 500 on supercomputers and actually has a 36% market share.
As the pandemic spread, one of the things that stands out is how HPC/AI infrastructure will be used for innovations. Our HPC and AI powered solutions are breaking known barriers of performance. Lenovo recently launched the genomic solutions called Genomics Optimization and Scalability Tool (GOAST). Traditionally processing a genome took almost 150 hours, our GOAST solutions brings this timescale down to 40-60 minutes using standard x86 hardware. We also have this solution running across the globe. In India, it’s at Delhi University’s Centre for Genetic Manipulation of Crop Plants (CGMCP), who are using it for plan genomics.
With cloud, edge, HCI, how do you see the subscription based models shaping up?The pandemic has accelerated digital transformation across verticals and across organizations. It primarily brought the hybrid cloud into the mainstream model. Every organization today has a cloud strategy that spans both public and hybrid or private cloud, which makes the first aspect of this technology transformation. The second aspect is greater momentum on subscription models. We had launched a service called true scale. Lenovo true scale is a subscription-based offering that allows customers to use and pay for the data center hardware and services on premise or at a customer preferred location, without having to purchase the equipment. With this model customers don’t take the capital or shape of the hardware or other IT assets. Just like in a cloud, they pay for what they use each month as part of their operating expenses.
TruScale is available from us across our product portfolio. Take the SDI, hybrid cloud as examples, we provide these to our customers at their premise or a data center of their choice which addresses issues like regulation compliance which controls what they want to put in, but also offer it as a subscription-based model. We have seen interest from the commercial as well as enterprise segment. The way we have structure our solutions, especially in the commercial sector, you don’t have to start big. Businesses can be modular and then add to it as they grow. Not just from commercial or mid-market perspective, even large enterprises can grow as use services and as when required, depending on where they are in their cloud journey. So, the focus is entirely on customers and listening to what they are saying.
In terms of sectors, what are some of the key areas of focus?
Our offerings are horizontal and can be customized as per the sector which is where our Smart Vertical strategy comes in. BFSI definitely is a large segment. In this sector, the business model plays a big factor. There are businesses who use Lenovo primarily because of the three key factors we talked about previously – reliability, technology and innovation. Business use cases here would include In-Solutions Global. The number of digital payments in India is increasing exponentially and the market is expected to increase 10x in the next few years. Payment service providers like In-solutions global use HCI solutions which helps them bring down the deployment time given the security and the regulatory environments. We help them scale it up quickly.
Another example is Ashika Group. To keep cash, currency and commodity trading on track, Ashika Group migrated its mission-critical business applications to a reliable, powerful, and flexible Lenovo hyperconverged infrastructure, featuring Intel Xeon scalable processors. The company’s IT team decided to look beyond the traditional three-tier architecture set-up in favour of a hyperconverged infrastructure and worked closely with a team from Lenovo Professional Services to install a three-node Lenovo ThinkAgile HX3310 cluster at its primary data center, before migrating the ODIN platform and all other business applications over to the new infrastructure. 30 servers and storage devices were replaced with just three nodes—a tenth of its previous physical footprint.
You must also know our position in manufacturing in SAP, we are the leading provider of infrastructure solutions on HANA migration and on the appliances, we are amongst the top two vendors globally. Education is also a big sector. Healthcare and research are very important given our leadership position in HPC AI. In fact, 17 of the top 25 universities use our systems globally. Our services are even used in the government sector which makes this sector a key focus area for Lenovo.
What are the top three trends in technology and what are Lenovo’s key focus areas?
If we look at emerging trends, ‘cloudification’ is on the top. The customers will have a clear cloud strategy between public, private and hybrid. Given our portfolios across SDI, HCI on the hybrid cloud merged with the TruScale offerings, we are strongly positioned here.
Another thing which will be big is automation enable by HPC, AI & analytics. Going back in history, every downturn – economic or any pandemic – in the last 80-100 years has given a thrust to automation which will become more and more mainstream.
As data continues to grow each day, harnessing insights for business value will become a top priority. And this is how we’ll see more and more takers of HPC and AI. The foremost thing is what happens on IoT & the edge. With 5G coming in, we’ll see both data center and cloud moving to the edge.
What are the typical challenges faced by CIOs and how are you helping enterprises?
I think the most important challenge is customer experience. With the changing work from home hybrid environment the way we are consuming also has changed. Not just for end users, but also enterprises. For a CIO, the challenges to give a seamless experience to both its internal customers and external customers. Based on consumption pattern different solutions would come in and every organization in different verticals will have their own strategy. Lenovo is addressing the challenges is through its 3S Strategy. We are providing customers with solutions that are a combination of device and the core.
