September 30, 2013
Making Real Customers from Virtualization
Rich Pugh describes himself using a term that’s far from a virtualized IT pro. Pugh, who’s the new senior VP of worldwide sales and services at virtualization vendor Stromasys, says he’s “carried a bag” since the middle 1980s. The term refers to a salesman who’s working on a commission basis, someone who visits customers to close sales. That was not unusual at any size of IT customer in 1985, when Pugh started at Digital Equipment. Today these kinds of visits from such computer hardware vendors are reserved for large accounts. That’s what makes Pugh’s current job selling the Stromasys CHARON HPA/3000 emulator such a profound echo. His company is replacing the 3000 hardware which once required a sales call to spark an install.
Stromasys has been ramping up its executive and strategic team over the last 18 months, all while the company has rolled out and refined its server virtualization software for the MPE marketplace. Bill Driest was introduced to the community at this May’s Training Day as Stromasys GM in the Americas Region. Driest now works for Pugh, since the latter arrived this June. All was explained to us by CEO Ling Chang, who joined the company herself in 2012.
In the fall of that year, Chang was introduced to us by Stromasys founder Robert Boers in a joint Q&A — in much the same way she introduced Pugh to us this month. We wanted to check on the outlook for selling a virtualization engine which emulates a server that was cut loose by HP more than two years ago. Emulators often surface while system support is still in place but manufacturing has ended. In the case of HPA/3000, everything was dropped by HP before Stromasys could sell a single unit.
Of such challenges are heroic stories made. Vendors have given up on creations or developments that had much life remaining, and Pugh and Chang believe they’ve got a good shot at replacing some mission-critical HP 3000 systems. Driest said that the North American rollout of HPA/3000 began with that May Training Day. Three months later the prospects still have interest and questions, but fewer of the queries are about technical capabilities. Pugh said he’s been pitching large companies this summer on 3000 replacements using the CHARON virtualization engine.
We interviewed Pugh and Chang in August, a month when HP 3000 users often gathered at a North American conference. In the week we talked, Google’s founder was announcing a burger built in a lab using 20,000 cow stem cells. A product that puts MPE software on Intel chips might seem as much of a surprise. Pugh is working to give the 3000 community a taste for the CHARON novelty, one that wants to eliminate HP’s iron like Google wants to remove the cow, but with genuine flavor.
What industry experience since Y2K led you to Stromasys, Rich?
Wireless data sales team leadership for ATT. Then for the last eight years, I worked at Insight, a large global reseller. HP was Insight’s largest partner, and they ran the New York market.
North American GM Bill Driest said he considered your May event the rollout for the product. How does your sales organization work?
Our sales model is quite different in each of the worldwide regions. In America we have our direct sales organizations, led by Bill. I come from an enterprise background, where I sold as a global account manager. I’m very proud of the fact that I carried a bag, with the recognition is that you have to drive revenue to the company. It’s something that I take very personally and seriously.
But with that said, I’m very familiar with the channel model. For example, Insight was a $5 billion dollar company that didn’t engineer a thing, but the intellectual power of our people there was really the value we provided to the market. However, with the experience that I left Digital with, I wanted to get my arms around direct client interface with the larger companies that we want to sell CHARON to.
What can you say about the large prospects you’ve been visiting?
I think they’d rather not have their names used, but one provides tax returns for the financial services industry. They’ve got two of the largest 3000s that were ever built. They have a production site and a DR site in separate states. They’re very interested in using us as an alternative to their platform given a catastrophic failure in their production environment.
The conversation we had with them was on the basis of risk management. Not competing on refurb system pricing or technical problems. When I asked him what compelled him to assemble his staff for our meeting, he said, “It took us a week to get our production system back up. We can’t afford that given the obligation we have to our clients.” Their application has to be supported until 2035.
The choices were a COBOL converter, a full migration, or our virtualization platform. He said he could not afford to use anything from the old  hardware architecture. Even if he got the most stable box in the world, it was all the peripherals that would be unstable.
That’s one prospect. How about a different industry?
There’s a large insurance claims processing firm. They’ve already put it through the proof of concept and now it’s just a matter of addressing the short term and long term implementation of the CHARON solution. Then there’s a cooperative of farmers who run their billing system through an HP 3000. The business reason they’re looking at us is to get off their older hardware platform, out of the maintenance costs. Our contact there is convinced we’re the right solution, and it’s a matter of getting the budget in place so they can move on it.
There’s also a company that runs Software as a Service for the financial services industry. On their own, they’ve used the freeware version of our product, and they’re convinced that it’s the right move for them to make. Again, it’s sold on a business-level conversation. It’s refreshing to take our sales strategy to this level, which I believe will shorten our sales cycle and drive an earlier adoption.
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