White Paper

HPE Is Ready Now

Sponsored by: Hewlett Packard Enterprise
Rob Brothers
Jed Scaramella
June 2016

Leslie Rosenberg

IDC OPINION
IDC has seen a technology transformation that has taken decades to evolve, from 1st Platform
technologies, which included mainframes and dumb terminals, to moving more of the compute to the
front office through client/server in the 2nd Platform, to the 3rd Platform, which includes mobile, social
business, cloud, and big data and analytics technologies as foundational pillars for moving toward
digitization. We're entering an age where ideas can become reality more rapidly than ever before through
the adoption of new technologies and platforms. New business models will be more tightly linked to
customer demands, while the lines between internal operations of the enterprise and its external
ecosystem (e.g., customers, markets, competitors, partners, and regulators) are rapidly disappearing.
Business leaders are challenged to move their enterprises to the next level, a digital business
transformation, employing digital technologies coupled with organizational and operational innovation
to create new business models and to drive business opportunity. IDC believes that enterprises will
either become adept at digital transformation and thrive in the market or fail to master the disciplines
and struggle to survive. Moreover, business leaders need to master not only the disciplines but also
the alchemy of combining and managing their interactions to create digital gold. IDC believes
enterprises need to:

Assess their capabilities and their current stage of maturity in digital transformation

Enable a dialog among business and technology executives about goals and actions relative
to digital transformation initiatives

Identify areas of digital transformation capability that require strengthening

Evaluate internal capabilities and maximize third-party relationships

Establish standards and milestones for pursuing digital transformation initiatives

Enterprises are at different points in their digital transformation, and IDC recommends working
with partners that have strong capabilities in helping assess where enterprises reside in the
transformational process. These partners may not only help determine where the enterprise resides
but also have the ability to move the business along that transformational journey. To this end,
Hewlett Packard Enterprise (HPE) possesses relevant key capabilities.

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IN THIS WHITE PAPER

This IDC White Paper discusses Hewlett Packard Enterprise's strategy to accelerate digital
transformation journeys and the company's portfolio of products, solutions, and services that enable
enterprises on their progression toward digital transformation.

SITUATION OVERVIEW
CIOs and line-of-business (LOB) executives are at the forefront of a major transformation, with the
endgame to create a business and IT organization where all processes and operations are entirely
digital. The degrees to which organizations can be competitive and ultimately profitable are now
inextricably linked to decisions made within IT. Today, IT expectations are shifting from providing
technology services that support business processes and operations to a point where business units
seek to leverage IT to drive new opportunities and provide a competitive advantage in the market.
As the market moves toward what IDC terms the 3rd Platform, defined by mobile, social business,
big data and analytics, and cloud technologies, the impact on IT infrastructure and processes will be
profound. The 3rd Platform will be a cornerstone in the journey to "digital transformation." As such, IT
infrastructure requires significant consideration and strategy in light of workloads, investments, and
business objectives. IT applications and services play a central role in enabling business objectives
and the journey toward digitization. The infrastructure that supports these services must be responsive
to the business and dynamic enough to meet the rapidly changing needs of the technology and IT
landscape. No longer can infrastructure be optimized by the traditional process of routinely upgrading
equipment and adjusting architectures for new initiatives. Digital transformation requires a rethink of
the IT infrastructure's strategic importance and will need to encompass not just technology trends but
also, just as important, people, process, and methodologies. The CIO's key role in a digital
transformation journey should focus on how IT strategy will be planned, designed, run, and managed
to meet future business objectives.
While digital transformation presents significant opportunity, for many enterprises, this journey can
seem overwhelming. As such, leveraging the technology and services expertise from a third-party
trusted advisor is a requisite for success. This IDC study provides guidance to enterprises on
questions to ask regarding digital transformation and how to move forward on the journey toward
digital transformation.
Figure 1 illustrates IDC's Digital Transformation MaturityScape maturity model, which highlights the
five stages of maturity an organization must pass through on its way to becoming an optimized digital
business. Not every organization begins at the ad hoc stage or finishes at the optimized stage, but
gaining an understanding of the "as is" state and what the "to be" outcome will be is the first step to
successfully leveraging a maturity model. To some enterprises, taking stock and assessing where they
are in the journey can be challenging. IDC believes it will be essential for CIOs to consider technology
vendors that can be partners in this journey, rather than vendors that are solely providers.

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FIGURE 1
IDC's Digital Transformation MaturityScape Stage Overview

Source: IDC MaturityScape: Digital Transformation (IDC #254721, March 2016)

It is important to take a hard look at the organization's internal capabilities including people, processes,
and resources to determine where your organization is on the progression toward digital transformation
(refer back to Figure 1). All lines of business as well as executive leadership need to be aligned on the
assessment of the "as is" state as well as the definition of the "to be" state to ensure successful
progression from one maturity stage to the next. There are multiple facets to becoming a "digital"
enterprise, and IDC further breaks down digital transformation areas into the following dimensions:

Leadership digital transformation. The ability for business owners to develop the vision for
digital transformation of products, services, and experiences that are optimized to deliver
value to partners, customers, and employees

Omni-experience digital transformation. An ecosystem approach to continually amplify

experience excellence for the previously mentioned products and/or services the enterprise
has just developed

WorkSource digital transformation. How businesses will achieve objectives by effective

sourcing, deployment, and integration of internal (full-time and part-time employees) and
external (contract, freelance, partner) resources (the people equation)

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Operating model digital transformation. Making business operations more responsive and
effective by leveraging digitally connected products/services, assets, people, and partners;
maturity in operating models enables the enterprise to spend more of its time and energy
focused on the business' external digital connections (making the business better)

Information digital transformation. The business extracts and develops value and utility of
information relative to customers, markets, transactions, services, products, physical assets,
and business experiences in other words, the business is highly leveraging its data lake

Most of the digital transformation areas are difficult to tackle because of the traditional ways
companies have functioned. The IT organization in an average enterprise has developed processes,
functions, and organizational models over the life of its operation. These well-established roles can be
difficult to change in the face of institutional resistance and the need to sustain the immediate
operations. Understanding how to use IDC's 3rd Platform foundational pillars (mobile, social business,
cloud, and big data and analytics) to streamline business or create new products, services, and
revenue models for customers is much more difficult than running "as is" and can sometimes threaten
the status quo and the people who work under that notion.

FUTURE OUTLOOK
The majority of IT departments and business organizations will find it a challenge to progress as
quickly as they'd like through the stages of IDC's MaturityScape. But more important than rapid
advancement is the need for a coordinated progression through the stages. Focusing on the key
dimensions in each stage of the maturity model in concert with one another will be essential for
continuity and successful growth. The inability to manage this type of imbalance in competency and
maturity stages across the key dimensions and subdimensions can be an obstacle to sustainable
success in a company's digital transformation efforts.
Leaders must assess themselves and their teams with respect to what it will take to develop a
world-class digital organization and/or when it becomes prudent to leverage partners with defined
professional services to help move to the next maturity stage. Organizations that master the orchestration
of the key dimensions and subdimensions will thrive, while those that do not will struggle to compete.
CIOs want to move their enterprise forward on this digital transformation journey, but many aren't sure
where to begin. When CIOs are evaluating potential partners, IDC recommends that they look for
vendors that can provide the following key process steps and characteristics to successfully enable an
enterprise on its digital transformation journey:

Define the "as is" and "to be" states holistically via a strategy day or workshop

Look to engage with a services firm with a proven framework and repeatable methodologies

A partner that can deliver both technical expertise and a deep understanding of the
enterprise's architectural environment and how it relates to the business

Articulate risk mitigation best practices

A firm understanding of the business cost associated with digital transformation

A services portfolio with depth and breadth to cover the entire infrastructure and its people and
processes

Highly trained people for a standardized approach that can scale globally

Demonstrate investment in tools, automation, and process for seamless product and service
delivery

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HEWLETT PACKARD ENTERPRISE

Positioned to Accelerate Digital Transformation

Hewlett Packard Enterprise is one of the largest providers of technology, solutions, and services in
today's economy. The company's comprehensive solution portfolio spans cloud, security, big data,
Internet of Things (IoT), mobility, and infrastructure. This section presents HPE's capabilities in these
transformational areas and illustrates how no matter where your organization resides on its digital
transformation progression, HPE has solutions to address each phase of the digital transformation journey.

HPE and the "Idea Economy"

HPE believes business is speeding up in every way as the information economy accelerates into the
next phase of the Industrial Revolution. Immense disruption and continuous innovation are redefining
strategy and upending industries around the world. Faster time to market is a competitive necessity,
and organizations are under pressure to innovate quickly.
HPE believes enterprises are on the cusp of enormous disruption in how business is done, driven by
what HPE calls the Idea Economy the ability to turn an idea into a new product or service faster than
ever before. Success today is defined by the ability to turn ideas into value faster than the competition can.
The winners are companies from start-ups to large enterprises that apply technology to quickly fuel
the power of ideas. Investments in the right technology and a commitment to a culture of innovation are
vital to success in this new era.
HPE is helping enterprises accelerate digital transformation with a holistic model focused on people,
process, and technology. HPE is helping enterprises apply digital capabilities to:

Enhance customer experiences

Create new products and services

Drive more efficient operations

HPE's model aims to deliver seamless experiences based on meaningful insights and supported by a
flexible IT platform to support growth and protect the digital enterprise. HPE's model to accelerate
digital transformation is focused on the intersection of four key elements:

Transform to a hybrid infrastructure. Utilizing infrastructure platforms that scale at the speed of
business is an integral part of being able to develop upon the ideas that generate in the Idea
Economy. Traditional infrastructures often do not provide the flexibility needed to parse
through unstructured data sets rapidly or create application platforms in seconds. This is what
is needed today to ensure that the new ideas being generated go to market swiftly and
efficiently. Delivering new apps and services quickly and continuously creates competitive
advantage. Whether built or consumed, these apps require an optimized mix of cloud agility
and traditional IT predictability. HPE helps enterprises achieve the right mix of traditional IT
and private and public clouds that power 100% of the apps and workloads and accelerate
value creation continuously.

Protect your digital enterprise. Threats and risks are everywhere; therefore, it is essential to
proactively protect all information and data across the entire customer engagement. HPE has
developed a portfolio to help reduce those risks, not just in cybersecurity but also in disaster
recovery (DR), backup, and compliance. HPE has the ability to help in all these areas, which
are equally important to the enterprise.

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In the digital world, risk and threats are everywhere, and they're increasing in diversity and
complexity. Enterprises must protect their most prized digital assets, whether they are
on-premise or in the cloud or in between the two. They must also adhere to complex
regulatory, compliance, and data protection issues and ensure business continuity in the
face of natural and cyberdisasters. HPE helps protect enterprises by building security into the
fabric of the enterprise, proactively detecting and responding to advanced threats, and
safeguarding continuity and compliance to effectively mitigate risk.

Empower the data-driven organization. IoT and big data are two of the most important topics
organizations are discussing today. Executives and managers are creatively thinking about
how to use their company's people, assets, and information to make better decisions and to
create valued offerings for customers. HPE has created services to assist enterprises in
demystifying the data they have to help make sense of it all and to help create new
processes to take advantage of the data that enterprises have at their disposal.
There are more connected people, apps, and things generating exponentially more data in
more forms business data, human data, and machine data. A data-driven organization
strives to rapidly and iteratively turn the data that matters into meaningful insights for
innovation, growth, and competitive advantage. HPE is helping organizations get more value
from big data investments and harness 100% of their relevant data to empower people with
actionable insights that drive superior business outcomes.

Enable workplace productivity. This is the summation of the new style of business, to enable
the end user whether internal or external to work more effectively and efficiently with the
best experience possible. Key to digital transformation is designing every touch point with
customers and employees in mind, with the goal of delivering engaging experiences anytime,
anywhere. In today's digital workplace, this includes delivering seamless collaboration among
employees to drive business outcomes.

Hewlett Packard Enterprise: Accelerating Digital Transformation

Hewlett Packard Enterprise has developed capabilities and expertise aligned with these major themes
to help enterprises focus on where in the digital realm they need assistance to make the
transformation. HPE provides solutions no matter where enterprises are on IDC's MaturityScape (refer
back to Figure 1). The destination is about applying these emerging digital technologies and
capabilities to drive top-line growth and bottom-line savings. HPE's approach enables organizations to
accelerate digital transformation while keeping the business running and is focused on integrating
digital initiatives within the enterprise and with today's ever-expanding partner ecosystem.
HPE's digital transformation model begins with the personalized, contextual experiences created for
and delivered to customers, partners, and employees, driven by real-time, actionable insights that
drive optimization with a modern, flexible, and hybrid IT platform while protecting the enterprise from
all forms of risk. Figure 2 shows how IT can no longer solely focus on managing costs. IT must
become a value creator and deliver real business outcomes to the business and customers.

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FIGURE 2
Cost and Outcome Bridge

Source: IDC, 2016

HPE's digital transformation model is based on practical insights from the company's own
transformation and experiences, helping enterprises around the world transform. Each digital
transformation journey is unique. HPE is helping enterprises succeed in and accelerate their
journey to a digital enterprise.
As such, HPE is aligning core deliverables to provide services that deliver business outcomes and
leverage HPE's core intellectual property (IP) and technology innovation. The Hewlett Packard
Enterprise technology road map and solutions are open, flexible, and future ready, harnessing the power
of open source technology and standards that enterprises and developers require in the digital world.
As more enterprises embrace the 3rd Platform and the underlying technologies of mobile, social
business, cloud, and big data and analytics, CIOs and IT managers face an especially tricky balance
between maintaining existing IT assets that are critical to business processes and integrating new
technologies to achieve competitive differentiation. To help enterprises achieve these goals, HPE has
structured its offerings with the following in mind:

HPE serves as a lead service provider (which IDC defines as a central point of contact that
can assist an organization with its technological needs) across the IT industry, partnering with
many software vendors to create a more robust solution. HPE will be that first point of contact
for the enterprise when it comes to solving issues.

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HPE offerings include features and deliverables designed to help IT organizations manage
and support their existing IT assets; providing this assistance helps enterprises free up
resources to evaluate how the business needs to transform.

HPE consulting services can help organizations evaluate and plan private/hybrid/public cloud,
software-defined datacenters, workload portability and migration, and datacenter platforms
and facilities.

Depending on where you are on your digital transformation journey, HPE has the products (converged
infrastructure, server, storage, networking, and software), solutions, and services to combine and
create the right path for your organization to enable an efficient and effective journey to the digital age.
HPE looks at the following capabilities as key areas of investment to take that journey to digital
transformation:

Converge and virtualize the datacenter. Build a bridge to tomorrow's applications, workloads,
and data. This includes modernizing your servers, storage, and network foundation to give
workloads and operations the infrastructure needed for 3rd Platform development.

Automate and orchestrate. Develop and deploy now! The demand for continuous delivery
makes it critical to bring automation, orchestration, and advanced analytics to IT operations.
Most customers start with solutions such as HPE OneView to enable a more programmable
infrastructure and HPE Operations Analytics to predict issues and avoid outages. These
solutions can free up resources by automating, provisioning, patching, and orchestrating endto-end processes such as change management and disaster recovery.

Become a service broker. Most IT organizations are looking to become an internal service
provider that can broker apps and services regardless of where they are hosted. HPE can help
create flexible foundations that can create a single catalog of all IT services and apps.
Solutions include HPE Cloud Service Automation and HPE Propel, which is a self-service
portal for delivering IT services to end users.

Empower developers. This is key because we are living in an increasingly developer-driven

world. HPE has developed a portfolio of open platforms, management software, and services
for application development and delivery to help make developers more productive.

HPE offers secure converged and virtualized technology solutions across servers, storage, and
networking to help design and deliver workloads more quickly, flexibly, and effectively. HPE has
software and services to help automate and orchestrate infrastructure and application delivery
processes. Whether the enterprise needs to run traditional apps or enable DevOps to accelerate
delivery of new apps, HPE has solutions so that enterprises can focus on their core business.

CHALLENGES/OPPORTUNITIES
IDC believes HPE needs to focus on how it can develop incremental offerings in the application and
business services space, which will scale the business more effectively. In the Enterprise Group, HPE
needs to continue to take advantage of the strong demand for enterprise infrastructure associated with
the move to the cloud (both public and private). We believe the "greater cloud spending" for IT services
and products will continue to grow, and HPE is in an excellent position to capitalize on the
infrastructure portion of this customer spend. In software, HPE needs to accelerate its efforts to
rationalize its strategy and then invest to build out a more robust portfolio. We believe this should
include a mix of next-generation SaaS-based security and infrastructure components that can be
harmonized (from a selling perspective) with HPE services.

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Leveraging learnings and experiences from its own digital transformation, HPE has developed tools,
methodologies, and processes to help define the value that services bring to extending the customer
relationship. Investments have been made to ensure that the right teams are leading solution
development and refining the go-to-market strategies. This includes illustrating the value internally to
sales teams and the role that services play for pull through and recognition of more advanced product
sales. This also involves proactively positioning services within the product management life cycle and
tightly aligning technology services and the product portfolio.

CONCLUSION
Enterprises must endeavor to understand and plan for what transforming to a digital business means
for their company's strategic direction, IT investments, revenue models, internal processes, talent
development, and ability to compete. Innovation and speed will be paramount for success. IDC
believes that enterprises will either become adept at digital transformation and thrive in the market or
fail to master the disciplines and struggle to survive.
As part of the digital transformation, an enterprise must assess its own strengths and capabilities to
master the journey. IDC believes there must be a synergy between the business and technology
executives to align goals and requirements, assess capabilities and shortfalls, evaluate partners and
providers, and develop standards and milestones for success.
Each enterprise will be at its own unique point in its digital transformation journey. IDC recommends
working with partners that have strong capabilities in helping assess where organizations reside in the
transformational process and where organizations wants to go at the conclusion of the journey. These
partners should not only help determine where enterprises reside in the maturity curve of the
transformational process but also have the ability to move the business along that transformational
journey in a strategic and defined way that presents the least amount of risk and disruption to the
business. IDC believes that Hewlett Packard Enterprise possesses the capabilities to help its
customers on their successful journey toward digital transformation by providing the right combination
of people, process, and technologies.

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About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory
services, and events for the information technology, telecommunications and consumer technology
markets. IDC helps IT professionals, business executives, and the investment community make factbased decisions on technology purchases and business strategy. More than 1,100 IDC analysts
provide global, regional, and local expertise on technology and industry opportunities and trends in
over 110 countries worldwide. For 50 years, IDC has provided strategic insights to help our clients
achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology
media, research, and events company.

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