Michael Miller, SUSEPeople arriving at Prague’s Václav Havel Airport for open source company SUSE’s conference this week could be forgiven for thinking they’d flown to the wrong city.
Baggage carousels were plastered with the crimson advertisements for rival vendor Red Hat, drawing grins from the SUSE fans, many of whom were wearing at least one item of clothing bearing an emerald chameleon.
“Looks like we’re doing something right,” said one while waiting for her bag.
Enterprise open source is dominated by the two players: Red Hat’s market share is estimated at about 60% and SUSE has about 25%. The rest is made up of smaller players such as Ubuntu and Debian and a host of others.
Michael Miller, SUSE president of strategy, alliances and marketing, told The Margin his organisation prepared the ground for the sales organisation.
“My team creates the things they’re going to sell together (with the partner). We take the SUSE operating system combined with a partner’s hardware platform, combined with their software assets, and we optimise that and put it together into a solution and then the sales organisation pairs up with the partner, or the partner’s downstream channel, to take it to market.”
What is he seeing in the sub-Saharan region?
“One thing I’ve noticed in South Africa is that there’s a fair amount of early adopters … folks who are willing to take emerging technologies and work with them to do something interesting.”
He mentions one of its first OpenStack (software) customers were from South Africa, when the emerging technology was still ‘fairly immature’.
Is there any reason South African companies are early adopters?
“To me, it seems like part of the culture, and a willingness to engage with things. It takes a little more effort to be an early adopter and engage with new technologies and there’s an understanding that when I’m using this, you have to try it out - and things are going to happen - and then you have to fix it and evolve it. There has to be a willingness on the part of the customer to work closely with the vendor. In an early stage technology, you can’t just give the customer the product and walk away.”
Miller says the competitive landscape is different in every country. One example is North America, to which SUSE was a late entrant.
Red Hat has more ‘mindshare’ in this market, and he says SUSE has worked hard over the last five years to create more awareness of its product.
Is SUSE is an engineering led organisation?
“Not from a business point of view. If you allow yourself to become too led by the engineering, you’re going to be in trouble.
“If you think of the world from bits and bytes out, and you do things just because you can, you’re going to end up with disconnects between what you’ve created and what the market wants. It’s really important to look at what are the real problems people are trying to solve. What are they interested in paying for?
“What is it that enterprise customers really need, that we’re well positioned to provide?”
Miller says SUSE gets this intelligence from 'directly interacting'.
"We spend time listening to both partners and customers. A lot of it comes through our partners, because our go-to-market is very partner oriented. Ninety percent of our transactions are touched by one or more partners. A lot of times it’s more than one partner. Maybe it’s a hardware vendor and a systems integrator combined, using our technology to implement a project for a customer. So we listen to the customer, the SI and the hardware vendor to understand what is going to allow us to be the choice of technology versus something else. Why would they choose to bring SUSE into that transaction?”
He says it’s imperative that his organisation and the sales organisation work very closely together.
His team includes product managers, while the sales organisation has direct engagements with customers.
“That information needs to come back into the product management organisation and then - working with engineering - they translate that into roadmaps and product requirements.
“You really have to have everyone working together in a really open channel of communication, otherwise you’re building stuff that doesn’t match this. Some organisations really struggle with that. They have a disconnect between the market side and the engineering side.”
How do you manage that internal communication? By email?
“We spend a lot of time, literally getting together and talking about it. We do quarterly business reviews where we bring together the functional leaders of the business. So that's myself, and the president of sales and engineering, and we bring our VPs to those meetings and we talk through what’s working and what’s not working and make sure we’re aligned and then we create product roadmaps. We then bring those to the leadership team and we talk that through them and evaluate them and provide feedback before we interlock.”
Interlock?
“It’s a phrase we use internally to take a proposal, say the next version of SUSE Linux, (and someone will say) ‘Here’s my proposal, let’s do an interlock meeting’.”
He says all the stakeholders from the major functions walk through the proposal together and evaluate the business, marketing and competitive elements, as well as the technology.
“And then we agree: ‘We’re going to release this product on this date with these general set of features'.”
With just the two vendors in the commercial enterprise business, is the competition fierce? Are you poaching people from Red Hat, and vice versa?
Miller says it happens, but not that often.
“That’s not the main focus of our efforts. There’s so much happening (in the market). There’s so growth, so we’re focussed on that. We’re focussed on maintaining our existing customers. And as we develop more products, there’s more that we can sell to our existing customers and there are constantly new things happening based on Linux. That’s one of the great things about being in a growth market, is that you and your competitor can both grow. You don’t have to grow by only taking away from each other. We’re both growing, and occasionally we do trade back and forth, but the growth is coming from the growth of the overall market.”
“I have a lot of respect for Red Hat. I think they’ve done a fantastic job growing their business. They’re a good company and they have good products, and I’m happy to see them be successful and grow. And that doesn’t prevent me from being successful and growing. And that’s the beauty of a growth market."
Miller says everything SUSE does, ‘we try to do with partners’.
“What I tell my marketing organisation to do is: ‘Any time you’re going to do something, think ecosystem first’. Because if we’re doing an activity or spending money on an activity that doesn’t involve the ecosystem, something’s wrong. Internally we use that phrase: “Ecosystem first” and we apply that to all of the things we do."
Any advice for SUSE partners?
“Other than use more SUSE? (laughs).
“The nature of the ecosystem is changing a lot. In the old days, the ecosystem was simpler. You were either a hardware vendor or a software vendor. Or you’re a channel partner… these were the basic fundamental categories. These days lots of partners are more than one. Most of the hardware vendors are also software vendors, and a lot of them are also cloud providers, and a lot of them also have a services organisation.
"So one piece of advice would be, when you’re working with vendors, help them think of the ecosystem holistically. All of us in the industry need to start thinking … we need to get out of the old partner model that’s been around for 20, 30 years, and we need to change our mindset and think of ourselves as an interconnected ecosystem, not as these silos and black and white categories. It’s all interconnected."