Getting Nutanix into the field of vision of enterprise CIOs - that's one of the core objectives set out by Nutanix CEO Rajiv Ramaswami one year into his role and getting simpler could be one of the most powerful tools to enable that.
Nutanix has been too complicated to date, Ramaswami argues. Nutanix is best known for its Hyper-Converged Infrastructure (HCI), a software offering that integrates and manages cloud and storage infrastructure. This brand recognition has had its limitations, Ramaswami acknowledges. The firm needs to be simpler and to aim higher in the technology heirarchy:
I completely agree we are viewed as an HCI firm, and that means we go up as far as the VP for IT. That has served us well. It is one of my goals to become more relevant to the business case, the big picture which CIOs deal with. So we are changing our narrative and our brand. But it takes multiple years to move a brand. Now, with a portfolio, we are moving from HCI to a hybrid cloud company.
Cloud is an operating model, not a destination. Flexibility and regulations mean organizations have to plan and run the applications on infrastructure that is agile, automated and easy to use.
Ramaswami has been in the top role at Nutanix for just over a year. Taking over the helm in December 2020 as co-founder and CEO Dheeraj Pandey retired, Ramaswami came with over four years of experience at VMWare, the virtualization provider Nutanix often comes up against in RFPs.
His first year has started well - Nutanix reported 19% year-on-year growth, and the CEO believes his strategy to simplify the product portfolio will enable further growth. He says:
We executed with discipline. But I recognize that we operate in a land of giants.
A new portfolio
In terms of those simplification objectives, the focus has been evolving from a series of point solutions into five core areas - cloud infrastructure, cloud management, unified storage, database services and end-user computing. With the need for Nutanix to mirror and meet the needs of a CIO, it's crucial that this mix is correct. To that end, ten regions trialled the simplified offering before it became the global standard for Nutanix. The end result of this? According to Ramaswami:
We had innovation in silos; now we have innovation within a portfolio.
In addition, with an ambitious target of 25% sales growth per annum laid down, Nutanix joins the growing list of enterprise software provider who are morphing into a subscription business. Ramaswami believes this should benefit Nutanix and ultimately the customer through joined-up product improvements:
We have also simplified how we do metering and pricing. Prior to this, every product had its own pricing...Our intent from the simplification was not to increase or decrease prices. We didn’t want to impact pricing, as overall, we will sell more.
Despite the increased CIO focus, Nutanix is not abandoning the IT VPs who are powerful advocates for its technology, with Ramaswami arguing that the firm can help such an audience to become more business-centric themselves, which in turn will enable them to complete the journey to the role of CIO. But he flags up CEO-centric use case exemplars to illustrate what Nutanix can bring to the top table, such as using public cloud for disaster recovery, as well as for temporary increases in computing capacity to meet spikes in demand.
As organizations increase their enterprise cloud footprint in a post-pandemic lockdown economy, there is likely to be a tandem rise in what has been termed Cloud FinOps, the practice of a business-wide accounting system for monitoring and analysing cloud costs. Ramaswami suggests:
There is not the awareness of Cloud FinOps yet, but it is a great opportunity for Nutanix. Cloud offers ease of set-up, but once it is at scale, the costs go up. We say to customers, 'You really have to consider this, and where should an application be run from'.
Looking further ahead, rising levels of sovereignty regulations will see the enterprise requiring access or proof of sovereign cloud environments, which the Nutanix portfolio can manage and again. Ramaswami believes this will be another opportunity for Nutanix to move into position as a business solution.
Alongside simplification, Nutanix has been focusing on industry partnerships. An existing hardware relationship with HP was extended in 2021, while a new relationship with Redhat was also inked in the same year.
One of the most interesting alliances perhaps was the signing of a partnership with Microsoft in September 2020. This saw closer procurement for Nutanix software being incorporated into the Microsoft Azure credits program, as well as the ability to add Nutanix clusters to the Azure environment. A more recent sign of Nutanix more closely investing in its partnership with Microsoft came in January, with the appointment of Microsoft Corporate Vice President Gayle Shepherd to the Nutanix board of directors.
Although cagey about the details, Ramaswami says the resulting closer relationship with Redmond will be seen in new CIO-targeted products, to be revealed later this year. Expect great things, he suggests:
I do think we have an opportunity to do more with Microsoft. We are having weekly engineering meetings with them, and they are motivated to work with us.
All this leads Ramaswami to claim one year on from his appointment:
When you look at the market that is available to us, there is a lot of room for us to eat into. The opportunity to grow is by growing market share.
With the popularity and business benefits CIOs are seeing from the adoption of the Microsoft Azure stack, Nutanix getting ever closer to Redmond looks to be a wise move. Time will tell if it leads to Nutanix winning over the hearts and minds of CIOs.