REDMOND, Wash., Dec. 13, 2006 — Microsoft and Hewlett-Packard Co. (HP) announced today that they are taking their 20-year relationship to a new level with a formalized, three-year initiative to jointly develop an expanded portfolio of IT solutions for enterprise customers called “HP & Microsoft Solutions for the People-Ready Business.”
The move represents a significant affirmation from the world’s largest IT company that the upcoming wave of technologies from Microsoft, including the 2007 Microsoft Office System, Windows Vista and Exchange Server 2007, is expected to provide substantial benefits for enterprise customers by enabling them to adopt technologies that make their most important asset – their people – more effective.
As part of the initiative, Microsoft and HP will expand their portfolio of enterprise software and services offerings, build and deliver a formalized People-Ready training program for HP, and establish a dedicated HP Services Microsoft Solutions Practice – all designed to help customers deploy and run as People-Ready Businesses.
To get a better understanding of what the announcement means for the two companies, the industry, and enterprise customers around the globe, PressPass sat down with Simon Witts, corporate vice president of Microsoft’s Enterprise & Partner Group, and John McCain, senior vice president and general manager of HP Services.
PressPass: First, can you briefly describe the significance of this announcement for the enterprise? What did the companies announce?
Simon Witts (Microsoft): Much has changed over the years in enterprise solutions and services – the vendor and competitive landscape, the way that companies go to market together, and the fact that customers now require “partnerships” with their IT vendors, to name a few.
This agreement represents the next, evolutionary step to providing the highest-quality and most cost-effective solutions for enterprise customers. This signed agreement provides business productivity and core infrastructure solutions to our largest enterprise customers.
The agreement represents a shared vision of how enterprise customers can build a people-ready business through products and services from HP and Microsoft, as well as a commitment from both companies to help customers realize maximum value from new, emerging solutions such as unified communications and enterprise search. We also have agreed on a joint go-to-market approach, where we will do joint account planning with our customers to help them realize the value that we’re delivering.
We believe that when taken together, this agreement creates a targeted, more customer-centric approach to solving business problems and addressing their IT imperatives.
McCain (HP): HP and Microsoft will provide a unique, differentiated and comprehensive set of enterprise solutions based on Microsoft next-generation technology, supported by HP’s extensive IT portfolio – one of the broadest technology portfolios in the world.
Supporting the growth initiative, HP and Microsoft will both be investing more than US$300 million in the relationship. With more than 22,000 Microsoft-skilled professionals already, no other partner is putting more global “feet on the street” to support the People Ready Business. Over the next three years, HP will grow its Microsoft-focused service capability to more than 30,000 Microsoft-trained resources. Also under the agreement, HP will train 8,000 resources during the 2007/2008 timeframe.
Additionally, HP will train and certify more than 3,000 consultants in Microsoft People-Ready technologies, and engage with Microsoft in joint R&D and engineering to deliver production-ready solutions. HP has developed and will deliver a new, robust Microsoft-specific solutions portfolio designed to help customers fully realize the value of these technologies.
HP’s unmatched experience and expertise will provide enterprise customers with greater confidence that they can realize the benefits of this new day of computing. The end result is that with HP & Microsoft Solutions for the People-Ready Business, enterprises can realize greater value from their existing IT investments, capitalize on next generation technologies, and achieve a more agile, adaptive enterprise.
PressPass: Given the long history of cooperation between Microsoft and HP, why have the companies decided to pursue this formal agreement? What value does a new enterprise alliance bring to the two organizations?
Witts (Microsoft): Over the years, HP and Microsoft have collaborated and capitalized on significant IT trends including the advent of client/server computing, the rise of .NET, and the release of products in the 1995 wave. In April 2006, Steve Ballmer [CEO of Microsoft] and Mark Hurd [chairman, CEO and president of HP] met with 20 of our company vice presidents to discuss ways to take the alliance to the next level, and found that there was a great deal of alignment in their thinking. This initiative is the outcome of those discussions and months of planning and preparation.
McCain (HP): HP has a long history of providing comprehensive solutions that leverage Microsoft technology. This initiative builds on our unique relationship. With it, HP is taking our commitment and capabilities to a new level by offering enhanced solutions, and more resources to sell and deliver them.
As a result, we believe this will enable HP to extend its industry-leading position in providing comprehensive solutions that leverage Microsoft technology. No other partner has dedicated this scale of resources to enabling the people-ready business vision for enterprise customers on the Microsoft platform.
Conversely, no other software vendor will receive the same scope and scale of resource allocation at HP as Microsoft. The Microsoft alliance spans HP’s three major customer segments – Enterprise, SMB, and Consumer/Commercial, as well as all three of HP’s Businesses – Technology Solutions Group, Imaging & Printing Group and Personal Systems Group. Within Microsoft’s Businesses, work with HP covers the majority of business units and is equally pervasive throughout the world.
PressPass: What areas of business will these solutions focus on, and what unique value will the Microsoft and HP joint solutions bring to those areas?
McCain (HP): HP & Microsoft Solutions for the People-Ready Business are based on global knowledge base and experience for developing repeatable, cost effective, comprehensive solutions that meet real-world needs to help businesses succeed.
HP & Microsoft Solutions for the People-Ready Business extend benefits to enterprise customers in four primary ways: Empower, Connect, Simplify and Transform.
When a company uses information technology to amplify the knowledge, experience and insights of its employees, it acquires the ability to do the four things that are the prerequisite to achieving true competitive advantage in today’s business world:
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Empower: The people-ready business empowers employees to act with speed and efficiency to contribute to the bottom line.
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Connect: The people-ready business utilizes the power of technology to connect employees to customers, colleagues, partners and information so they can make smart decisions with speed and accuracy.
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Simplify: Complexity is the principle inhibitor of agility. The people-ready business is built on familiar, easy-to-use technologies that streamline processes, reduce costs and increase return on IT investments.
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Transform: As business conditions change, companies must have the flexibility to respond. A People-Ready business is built on an information infrastructure that adapts quickly to the evolving needs of employees and customers.
Taking advantage of these new solutions, customers will be able to empower individuals with the tools they need to capture critical information and make the types of informed decisions that drive positive change and success for their business. At the same time, they will able to transform and improve IT so it’s more responsive to business needs.
With those guiding principles in mind, HP and Microsoft will deliver integrated, innovative, comprehensive solutions in five solution family areas.
We will deliver Messaging & Unified Communications solutions to enable people to work faster and smarter as they respond quickly to new opportunities and provide higher levels of service.
Collaboration & Content Management solutions will help teams, departments and organizations aggregate, organize and share information and documents to increase productivity, reduce costs and meet regulatory compliance requirements.
We will also offer a line of Business Intelligence solutions to better leverage existing information assets enterprise-wide, to boost productivity, and to speed better-informed decision-making.
Business Process Integration solutions will also be offered to help customers streamline business processes with their own customers, partners and suppliers – with real-time access to information and data across multiple systems.
Finally, Core Infrastructure solutions will provide customers with a reliable IT infrastructure that delivers reduced total cost of ownership and ease of management, plus the security and flexibility to readily adapt to new business requirements.
Witts (Microsoft): Specifically we see the unification of communications and the broad role of SharePoint in helping people with collaboration, content management, business process integration and business intelligence. We see these capabilities as becoming common for people at work, just like spreadsheet programs, word processors and e-mail have become for personal productivity in the past.
The core infrastructure focuses on getting the cost of management and security down — the cost of backup and restore, data protection across servers and devices, and ultimately the risk of intrusive access. So the fundamentals of networking are improved in the core infrastructure that Microsoft and HP can deliver.
The business productivity infrastructure is centered specifically around unified communications, and changing the way people share and collaborate – and share everything, not just documents and time but ideas and insights and even business processes.
PressPass: What business value will enterprise customers realize by deploying HP & Microsoft Solutions for a People-Ready Business?
Witts (Microsoft): We’re really picking up on the fact that many companies are now standardizing and rationalizing the number of technologies they use and expecting these capabilities to be available to everyone at work, not just to specific user groups or specific users of particular applications. So in that sense, the key value of this for customers is to standardize on fewer technologies and ultimately fewer vendors and drive cost out of the IT operation.
Typically companies have been paying high costs to build out capabilities around applications, but not the universal capability that’s delivered through the familiar Microsoft Windows and Office client tools. With this agreement to build on a more standardized platform, companies can now “afford” to make these richer capabilities available to everyone inside the company and not just certain user groups or around certain application sets.
This enables the organization to empower its people with the tools and technology they need to capture critical information and make the types of informed decisions that drive positive change and success for business. At the same time, it’s transformative for the IT department, allowing them to be much more responsive to business needs.
McCain (HP): HP & Microsoft Solutions for the People Ready Business will help enterprise customers realize greater value from their existing IT investments by simplifying, transforming and connecting their technology assets more effectively; capitalizing on next-generation technologies to reduce and avoid costs, while simplifying their IT environment and the return on IT investment; and achieving a more agile, adaptive enterprise by empowering employees and providing them with access to information and tools they need to contribute more effectively to the bottom line, while transforming and improving IT so it is more responsive to business needs.
As a result, enterprise businesses can empower individuals with the enterprise technology and services they need to make significant contributions and informed business decisions that drive positive impact for the success of the business. People who work productively, have access to timely information, and easily adapt to change are empowered to succeed.
PressPass: How will this alliance benefit HP and Microsoft?
Witts (Microsoft): Many Microsoft customers are already using the base level of our core infrastructure with Microsoft Systems Management Server, the Microsoft Windows operating system and some base-evel security. They’re also using a subset of a unified communications portfolio, typically with Microsoft Exchange and a base usage of SharePoint.
What we’re doing here is showing customers how to build on that investment and in many cases strengthening that. They can take assets out of the core network such as identity management, access management, rights management and presence, and use that investment to bring the Microsoft Office servers alive and change the dynamics of collaboration, portals, business intelligence and communications.
Based on this approach, opportunities exist for both our companies to increase joint customer loyalty, increase customer adoptions and confidence in these solutions, increase the size and shape of the IT solutions market for customers and vendors alike, and develop deeper enterprise customer relationships that help us continue to evolve our approach.
McCain (HP): This initiative allows us to have a different kind of conversation with our customers – together – to help address their specific needs jointly. This allows us to work collectively to help the customer become a more agile, adaptive enterprise.
We believe this is going to drive significant, incremental growth for HP’s enterprise business. Specifically, this agreement represents a greater “attach” opportunity than any of the preceding joint initiatives over the past five years. This Initiative will drive additional revenue and market share for all HP Technology Solutions Group (TSG) business units globally.
The solutions leverage our leadership products, combining HP ProLiant servers, HP BladeSystem server, HP StorageWorks storage products, HP desktop PCs, notebooks, tablets and pocket PCs, along with imaging and printing devices – plus the software that helps customers use, monitor and manage these products easily and effectively.
With these new solutions, customers can put HP Services’ unmatched expertise and experience with Microsoft technology to work for their enterprise. The solutions are designed to help them realize the benefits of Microsoft’s next-generation technology and improve the return on their IT investments.
PressPass: Will HP or Microsoft expand opportunities to develop and sell these solutions?
Witts (Microsoft): With the new Windows Vista and the 2007 Microsoft Office system, Microsoft is releasing a significantly broader set of capabilities for customers of all sizes. As Windows networking becomes more and more prevalent, we think the rich capability of this business productivity infrastructure will become a new business standard, from the Microsoft Office servers down through the Microsoft Office client, delivered out through not just the desktop but devices as well.
With this new platform, we expect there will be expanded market opportunity for these capabilities, which have historically been point solutions. We’re basically “democratizing” this capability and making it readily available and affordable. The new call to action for IT professionals in the enterprise is to deliver this platform as rich infrastructure, and make it available to everyone regardless of their role.
McCain (HP): Based on this approach, we believe the following opportunities exist:
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Increase joint customer loyalty
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Increase customer adoptions and confidence in HP & Microsoft Solutions for the People-Ready Business
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Increase the size and shape of the IT solutions market for customers and vendors alike
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Develop deeper Enterprise customer relationships that help us continue to evolve our approach
The solutions can address the needs of Enterprise customers with a variety of existing infrastructure components deployed. And HP Services will offer integration services to help ensure maximum success.
