Jeff Clarke, Dell Technologies | Dell Technologies World 2023

thank you good morning everyone happy Wednesday Lisa Martin with Dave vellante live on the show floor Dell Technologies World 2023 at Mandalay Bay in Vegas this is our third day of coverage we have had some phenomenal conversations as you know there's been a lot of news unpacked we've had a great guest lineup Dave and we've got another alumni back with us we're going to be talking about everything Jeff Clark talked about yesterday in his keynote Edge why it's important how it's different always a highlight of the cube at Dell tech World Lisa absolutely please welcome back to the cube Jeff Clark Chief Operating Officer and vice chairman at Dell Technologies Jeff it's great to have you back on great t-shirt do you own a tie well I do I haven't worn one a long time do you have one of these a t-shirt you knew he was going to ask you that I had I had some ratty ones that my wife Deb throughout but you're well dressed good to see you it is good to see you you had a recent blog post that I checked out Innovation matters it's why we exist talk about Innovation at Dell particularly in the last year we've seen so much progress yeah I made comments on our uh keynote yesterday and with great pride what our company's been able to do what we've been able to achieve last year alone we had 2445 patents granted a large portfolio of over 28 000 now and to me that's representative of the Innovation engine that we've built the flywheel that we've built we talked about a number of products that we launched over 120 products last year 30 launches in our infrastructure business over 13 weeks and I just went through a series of things that we've built all culminating into ultimately turning into what we just said we're going to do last year into real products and offers which to me is the Real Testament that to say do ratio is where we want it and quite frankly The Innovation to deliver on what we committed to and it's I think capabilities are in again another good indicator that we have this flywheel moving and in the right areas our customers care most about you've got this pattern now you sort of launched announced a project that's solving you know a customer problem and then a year later you announce a product which as an analyst I give you high marks for that there are a lot of companies that you know can't really get enough out of their r d so that's that's good so we broke a pattern we used to do the work and then go tell people what we did and we have I think grown a bit that we now commit what we're going to go do before we do it and then go deliver it in the time afterwards why the change I think we needed to communicate that we were more forward-thinking that we were actually looking further ahead rather than spend the time in the lab in the engineering rooms doing the work and then launching a product we could build momentum we could set I think the tone of leadership in the industry that we are an innovator that work Forward Thinking looking down field and we align the organization to go do the work it's incredibly tight within Dell but but share with us how the customers really kind of are fueling that flywheel of innovation well we have the benefit of being a direct sales force for half of our revenue and partners with the other half to very important routes to Market and both of them and particularly the direct path gives us more touches with customers than anybody else in this Marketplace and we are able to take those touch points the information We Gather from our customers and turn that into product features product capabilities discuss the problems that they're having and then ultimately try to commit to solving what whether that be things like project Alpine now what we launched on Monday what we did with Native Edge and project Frontier so I I think we've built this really tightly coupled capability that is uniquely ours that links us with our customers more than I think anyone else in our Marketplace I want to go through some of the projects uh sure but I want to start with Helix because that's the year of AI so how did that come about what are those customer sort of alignment issues that you you you saw and tell us more about how we should expect that to progress over the next year Well it started with we have a great partnership with Nvidia gents and I have known one another for a very long time back in the old workstation days 27 years ago we are a large partner of theirs they're a large partner of ours and we kind of concluded as we've seen this momentum shift from their side and then what we see this AI thing has been we've talked offline isn't going away it's here it's here to stay we think it's as transformative and maybe the most transformative technology that I've seen in my 36 years whether that be the PC whether that be the phone the internet the cloud computing errors that we've been through this is as big and I believe bigger and we both stepped back and said if that's going to happen and at the rate that it's happening how do we help customers are having difficulty building the infrastructure making it it's not easy to deploy this is fairly complicated architecture so how could we build blueprints how could we build validated designs how we could merge our service capabilities take the best of Nvidia the best of Dell project Helix that's how it came about I want to ask you about uh go back to your thoughts it's maybe a bit of an academic question Jeff but I think you'll appreciate it when you and Michael and the team were you know driving the shift to microprocessor based systems there it coincided or maybe it catalyzed a change in the industry structure you know we've talked about this now for many many years but at the time it was not obvious that vertically integrated stacked and then competition began at each layer and Dell and PC Seagate and disk drives you know EMC in in storage Intel and microprocessors etc etc but it was a fundamental industry shift in the structure that favored companies like you that were focused the internet was different it was more okay how do we take advantage of this network and incumbents actually like you at the time they were able to take advantage of that do more direct many many examples there was some disruption too obviously Amazon and Retail how do you see a and but by the way I I mean cloud in many ways I mean yes sort of disruptive but it didn't have the productivity impact of those other two you and I have talked about this how do you see AI in the context of many dimensions here the disruptive nature versus the incumbent value and do you think it'll have an effect on the structure of the industry in terms of maybe the way it is consumed or the competitive nature of that industry yeah I think the the two Dynamics I would point to one is what you just called out there is a incredible opportunity to increase productivity with AI and it's disruptive and companies that figure out how to use their data and their understanding of their markets and customers and be able to synthesize that in a way that gives them unique insights they're going to have better business outcomes and we're going to see a wave to that it's almost we've spent the past four decades preparing for this moment preparing to enable a massive amount of data to be understood at a greater level of detail much more quickly and much more in depth to drive better insights better decisions and do them more quickly so if you don't Embrace that wherever you are I think you're going to regret that so whether that's developer productivity some of the co-pilot tools some of the other types of technologies that are out there today that are just helping developers with open source and and taking out the tedious work that you just have to replicate all goes away that's a great outcome I think about language-based task a fair amount of language-based tasks can be made more efficient and then architecturally what we think happens since you like open with microprocessors is the role of the host that we've been involved in for since the beginning the host processor is going to have lots of help dedicated specific specialty processors accelerators and you're going to see a fragmentation if you will that all workloads are going into the house we know that now purpose-built accelerators and then the ability to knit that together with a softer defined fabric I think is going to be key that's where we're going you know it's interesting we were talking about Charlie Cowles offline and I've watched a video of his maybe a year or so ago and he was talking about the the connect centricity of the new architecture it's not just about the CPU anymore it's all about the surrounding components is that really think about a software-defined data center where now we can have host we can have purpose-built accelerators we can bring one workload in we can arrange if you will this fabric through a softer defined layer to optimize for that workload bring on another workload recent the size or rebuild the architecture to map to that workload all via software that's where we think this is going and that's certainly what we're working on share your leadership principles you mentioned 36 years you are a Dell OG four sugars staple on Main stage but talk about there's been so much evolution of Dell in 39 years I just saw the anniversary of Michael creating the company in this dorm room was 39 years just a few weeks ago but but talk about how your leadership principles have evolved how the how you lead the company to really create these Endeavors and also be kind of differentiated and turning as they've said these projects into products consistently a tough question and I'm not well I've been on that main stage it is not my favorite thing to do I'm an engineer that likes to actually go solve problems and work issues so that's a very very difficult task for me leadership principles so look I I it's for me it's really simple we try to identify what is needed we try to create a reason why we need to go do this we're transparent with everything in the decision-making process to to make the decision to choose a path what the expected outcome is and then hold our team accountable and give them what they need to finish the work and a little extra help of compressing timelines and the competitive nature of that a little management tension on occasion and our teams respond well again I got to brag about their work yesterday which is tremendous and it could be more couldn't be more proud of what we were able to do on a consistent basis and the breadth of it which is one of the comments I made yesterday the breadth of our Innovation from the supply chain to what we do in PCS to servers to storage to systems to services I like our hand there's no what I like about your leadership styles there's no lack of clarity people understand very clearly what is expected and you're able to get people aligned and that's that's powerful for me one of the attributes I think great leaders are great communicators and great leaders are great simplifiers so we can get overwhelmed with the complexity of the task or the complexity of the problem but as a trained engineer we're trained to break down big prop a problem in the many many small problems which are manageable and if we can one of the roles I think I I play is to be able to break down that complex problem into manageable tasks clearly communicate that and try to simplify things and as a result we tend to perform reasonably well yesterday was big news about Cloud native Edge talk about from a from a challenges perspective what's different about the edge what are some of the core design principles around it that Dell is leading with well what's different about the edge it's where I.T and the things that we've historically done meet the real world we're interfacing with factories Transportation networks hospitals digital cities whatever they might be we have some great examples somewhere over there I think it is so that that interface where operations in the physical world meets I.T in the digital world is certainly where uh there's a lot of difference in what we try to solve and actually try to embrace this notion that we had to build a horizontal product that would allow it to scale to the different verticals not make it vertical specific horizontal in nature from an architecture point of view and then abstract the physical world from the digital world from the physical world so we could actually help our customers deliver the gear the things they need in their factories networks Etc so what we did is we built this software platform the horizontal platform that we talked about Native Edge and then we built in what customers tell us they need the ability to deploy devices the ability to manage devices the ability to provision devices in a secure manner all from a single pane of glass that's the software stack that we've built and then it's surrounded by a vast partner Network to help very unique vertical opportunities it seems so obvious now that you do the horizontal play and maybe it always was was there ever a discussion internally about well do we go horizontal or should we go multiple verticals or was that never even on the table always on the table Yeah okay it didn't pass yeah I just I can see why explain that we do not do well when we build very specific what we call snowflake Solutions no two are the same we're much better when we industrialize things and horizontal things and get the scale out of that and Abstract the problem at that layer that's sort of where we've historically played and we will continue to play and that's what I mean by that and it serves us well you know in 2021 John and I got a tongue-in-cheek came up with this concept of super cloud and it was the idea was floating above not not the superlative but it became a superlative and we got a lot of crap for for the term but then when we saw project Alpine we said there's evidence that it's a technically feasible that there's a customer problem that a company is addressing you don't use the term super cloud that's you know kind of our term but it's the same concept we talked about that over dinner in Boston yes several years yes we did several years and it was sort of in the early stages and so to see that come to fruition as an analyst is obviously very exciting my question is when you look at a project Frontier now native Edge do those two worlds have to come together remember I was talking to near zuk the founder of Palo Alto Network and he said the last thing we need in security is just another sort of stovepipe at the edge and of course there are a lot of you know Edge and iot security tools do you see those worlds coming together or are they so different to Lisa's question that it's it's unclear at this point well maybe something we didn't communicate as clearly as we should have the underlying architecture Hardware architecture that is in our supporting our Cloud our Apex cloud storage and our Apex Cloud platforms and the native Edge is the same okay the fabric of this common storage layer that I spent some time talking about yesterday runs all the way to the edge okay so the edge is one of the clouds that we believe is in this ecosystem Edge clouds color clouds Telecom clouds on-prem clouds public clouds this fabric my my word technical World substrate that connects these clouds data and apps extends out to the edge yeah maybe I was too busy tweeting about your T-shirt and missed that I doubt but so that's that's exciting to hear though Jeff because that is that is the vision that we've put forth the super Club but you know I'm not a technologist I mean I've been around a long time I don't want to pay attention so but but it's you got deep engineering expertise you know in your company and so I Look to companies like yours to see if the problem is technically feasible and I guess it's start with the is there a customer need it seems obvious there's a customer need for this well what's at least aren't what we believe is happening and what customers have done they have they're managing each Cloud individually and there's a set of ways that you manage each of those clouds and in their own in their own practice and what we believe what we believe for what we interpreted from what we heard is customers were looking for a consistent set of management tools and a consistent way to manage their Cloud environments we cleverly uh describe that as they want to orchestrate all of these clouds to look like one distributed system we thought we needed something to connect them we thought it was the data hence the common storage layer that substrate that I talked about so that's and given that we're a storage company and have deep storage expertise that became the foundational point of our architecture is data and storage and that extends all through Cloud here to Cloud there and all of the steps in between then we built our management tools our data our data movers our data Mobility tools to be able to support that and that's how we knit it together so it kind of comes back to that academic question that I was asking earlier about the structure of the industry it's it definitely there are still competition along horizontal lines you got you have competition in in storage for example it's not really head to head I mean maybe the odms but there is head-to-head competition in service but the companies like HP do other things my point is it seems like the cloud sort of brought together that that stack and and somebody with an end-to-end capability obviously this is self-serving but that is an advantage for you and I wonder if if AI accelerates that consolidation when I say consolidation I don't mean necessarily of the industry I mean from the standpoint of customer consumption that they don't want to necessarily buy okay I'll take a best of breed storage and a best of breed server and a best of breed Ai and a best of breed networking I just want a solution that can talk to each other across clouds and generally the cloud guys they put out Amazon puts out tools Microsoft tries to do abstractions they announce some stuff this week but they're not great at doing stuff across Cloud on-prem I know you got some we talked yesterday with some you know very exciting Partnerships with Microsoft but there's got to be somebody there to lead that end-to-end layer across the cloud yeah yeah I drew it perfectly another horizontal connection point we don't see the the vertical nature of how clouds are built today pivoting this way we thought we had the natural substrate to do that storage that we can connect those clouds apps and data a set of management tools and we're going to continue to invest in this architecture and build this out we think it's game changing at the end of the day if we can figure out how to make this work as one distributed system orchestrated and to do that we think it's very powerful is what customers want then they get the the ability to put the workload where they want it based on their needs then we get the ability to reduce complexity help them manage cost help them get more predictable costs which are things we hear from our customers in the current Way That clouds work and that's an opportunity for us game changers and and optimism I know Michael is an optimist and the fact that you have been working so closely with him for so long I imagine you're an optimist as well talk about when we talk about generative AI in the news media there's so much concern and obviously we have to talk about guard rails and ethics and responsibility but I'd love to know from your perspective how Dell is really enabling tech for good and enabling a sustainable future which we all know is going to be incredibly impactful globally Lots unpacked there let's start with the world work that we do around ESG and trying to make the world a better place and the environmental stewardship that we believe we're leading the industry whether that's a commitment to carbon neutrality whether that is a commitment to continue to use and reuse materials I talked yesterday about ocean bound Plastics and getting those out of where they would have ended up and into our products we've talked in the few past about using wheat straw mushrooms on our packaging we've talked about recycling gold at Apprentice circuit board so a long history of taking materials reusing materials materials on the fact that is garbage on someone else's Factory floor that we can repurpose to build product with we've been doing that we've been a leader we'll continue to do that the continued challenges is the world's appetite for more compute continues to grow and the engineering challenge to solve this is significant we're up for it I don't know how we're going to solve all of our 2030 targets at this point in time our engineering teams are working on it I'm confident we'll figure it out but it's part of what is fun about the job of that's the unknown ah so I think our track record there is is strong will only get stronger and we take that role very very seriously we've talked I think last year even on the stage about Project Luna where we think about a PC being used not once and then recycled used used again used again recycled and thinking about building it in a very different way so when it's serviced it requires less carbon footprint so I think track record there if I go back to Ai and and I am an optimist like Michael I generally think people are good people is this capability in the wrong hands detrimental it could be I think we all have a responsibility to work through that I think that's why things like zero trust architectures and what we're doing with Project Fort zero is pretty important long term hopefully that's a paradigm shift in security architecture that puts the good guys more back in charge I hope we think it is I think about what AI enables and there's just so much good there we'll figure out how to make it I guess good for all but we can't stop the potential here it I think it unleashes actually human potential I think it creates a new paradigm for us to solve things that we've not been able to solve why would we want to slow that down now we need to be responsible there's all sorts of data privacy legal issues which then if it come full circle it's why we think some of this will be done on-prem it's why not everybody wants to see their data in the big General models they're going to want to do domain-specific work and process specific work again with their data with their context yeah I mean we had a customer on he was running what do you say half a million cores yeah he said I'm not gonna do that in the cloud I can't afford it and as well a lot of the University supercomputers they want to show them off come on in well not everybody needs to run their model against the known written language of the world not everybody needs a model built on 175 billion parameters yeah a lot of this stuff can be done on a couple million 10 million 30 million parameters well you can do that inference on the edge of the with a host CPU or maybe a single GPU yeah and then the other end expecting open AI is running you know data centers in Ohio I mean it's because for a good reason so interesting what percent kind of changing subject you've been very generous with your time you haven't kicked me off yet you left it all on stage man I mean I know how hard you work at these things you know we do too but we you put us to shame what percent of your engineers are software engineers 80-ish percent 80 okay and so 385 and so now with things like Apex native Edge obviously a lot more software you know components to that and you can charge for that so that should longer term have an effect on margins right I'm optimistic me too you look at up one of one of my favorite I think you asked me last year what was my favorite announcement it was powerflex if you asked me today powerflex is still really a fascinating architecture Michael talked a little bit about its ability to scale compute and storage independently massive scaling multi-hypervisor support but that software that softer defined asset might be sort of the core of our common storage layer uh yeah and and I mean you I gotta again give you props I mean when you inherited the EMC portfolio you had to do a lot of work to consolidate it and you you made you shared for many you know years how you uh approach that um and you've got a much more disciplined approach that horizontal pieces much more of our Engineers are uh doing new and Innovative work rather than doing several versions of similar Technologies and when you can get that sort of dispersion really focused we're able to do deeper levels of innovation quicker which is I believe what we're seeing and we still have opportunity we're not done do you feel how do you think about m a versus organic investment r d in in that context I mean now that you've got this great balance sheet um do you what's how do you think about the balance between the two you want me to talk about M A in front of the big old screen here how do we think philosophy I mean you know I mean well look the company got a lot of M A obviously the company has a capital allocations uh structure we are committed to that Capital allocation structure and within that it allows us to do some very purposeful M A we made two small Acquisitions last year picked up by some they're very integral components to what we've launched yesterday in the architecture that we talk about has components of those capabilities in it so where we think we need a capability we have the ability to do that as an organization nothing to announce today well yeah I know that but so but what you just described is maybe a a smaller acquisition that is a big lever to a a much to catalyze a much greater opportunity is that fair well think about the the route to Market access any technology that we bring into the family has you have the largest sales force in technology the ability to either integrate that into a product to get a capability or to have a specific piece of offer that we'd go sell with that Salesforce is pretty significant Market access it will be very purposeful in that regard Jeff it's been such a pleasure having you on the program I think you just delivered a Master Class for us did a great job of really talking about what's driving the continued Innovation at Dell I think I can see and hear what inspires you we thank you so much we've done so much time we look forward to to seeing you next year I'll see you yeah thanks again all right our pleasure for Jeff Clark and Dave vellante I'm Lisa Martin up next Dave and I are going to sit down and share some insights we've learned over the last two and a half days stick around [Music] foreign

2023-05-29 18:37

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