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HP Shifts Cloud Organizations Around Ahead of Corporate Split

Research into cloud products now belongs to the software unit, while sales moves to the massive Enterprise Group.

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With a month to go before its split into two companies becomes official, the part of computing giant Hewlett-Packard that will spin out as its enterprise-facing business internally announced some changes to its cloud business today, according to a memo obtained by Re/code.

The memo from CEO Meg Whitman announced that the research and development organization related to its cloud computing efforts, a group headed up by Mark Interrante, a former Rackspace exec who joined HP in July , as well as its cloud product management group, headed by Bill Hilf, will move into the $4 billion (2014 sales) software business unit headed up by Robert Youngjohns.

HP’s cloud-related go-to-market effort, the group devoted to selling its cloud hardware and services, will be shifted into the Enterprise Group, the $28 billion (2014 sales) unit devoted mostly to selling servers as well as storage and networking gear. The shift appears to be intended to get these products and services in places within HP where customers are buying them.

The move will be finalized along with HP’s split into two companies — HP Inc., devoted to PCs and printing, and Hewlett-Packard Enterprise, focused on corporate computing hardware and services — which goes into effect on Nov. 1. The company said it will cut about 30,000 jobs after the split.

Here’s the memo announcing the change:

Organizational changes to support our hybrid infrastructure strategy

To: All Hewlett Packard Enterprise Employees

As you know, we are moving quickly to reorient Hewlett Packard Enterprise to capitalize on four major market opportunities. At Discover, we introduced four transformation areas to align with these opportunities: transform to a hybrid infrastructure, protect the digital enterprise, enable the data-driven organization and empower workplace productivity. Together, they represent about $1 trillion in total addressable market. If we can deliver on the promise of these transformations, we will enable a new era in business for our customers – one where ideas can be turned into value at the speed of imagination.

In order to achieve the cost, speed and agility that customers need, we must help them take an application-first view of their infrastructure. Since no two applications will have the same profiles and no two companies will have the same requirements, our customers each need unique hybrid infrastructure solutions that allow them to seamlessly manage thousands of applications across traditional IT and public, private and managed clouds.

No company is better positioned to deliver on this critical need than Hewlett Packard Enterprise. But it will require a new approach to how we go to market, how we develop new products and how we build the solutions our customers need. Because if the future is hybrid infrastructure (and I believe that it is), Hewlett Packard Enterprise must be organized to bring together all the pieces for a holistic view – from the data center to the cloud.

To accomplish this, we’re announcing organizational changes that will enable us to accelerate our hybrid infrastructure transformation area.

First, there is a natural alignment between our Cloud and Software products. To help support this alignment, Cloud R&D, led by Mark Interrante, and Cloud Product Management, led by Bill Hilf, will move to the Software organization. Bill Hilf will lead this organization under the leadership of Robert Youngjohns. Mark and the Cloud R&D organization will report into Bill. I believe organizationally pulling these teams closer together will help to speed our product and R&D efforts, allowing for the synergies to shine through.

Second, our customers are aggressively moving to a hybrid infrastructure, which is driving heavy investments by the enterprise. Providing solutions for hybrid infrastructure is a huge opportunity for HPE and something that we are uniquely suited to do. To best position the inherent strengths of our Cloud offering and ensure that we have the hybrid solutions that will usher in the next phase of growth, Cloud Go-To-Market (GTM) will move to the Enterprise Group (EG) where it will be combined at the regional level with the Converged Data Infrastructure (CDI) GTM. Cloud is a central component to transform to a hybrid infrastructure and aligns squarely with the customer-focused, solutions-led selling commitment of Hewlett Packard Enterprise.

The unified Cloud and the CDI Sales and Presales teams will be firmly embedded in the EG regional sales structures. By integrating Cloud into EG Sales, we will offer one face to the customer to enable their transformation journeys to a hybrid infrastructure – from converge and virtualize to automate and orchestrate to transform, build and consume.

While these changes go into effect on November 1, we’ll begin to transition over the coming weeks.

I’m excited for what the future holds for our Cloud business and am looking forward to helping our customers transform their enterprises through our strong portfolio of solutions.



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