REVITALIZING THE CHANNEL
VMware shares have nearly doubled over the last year. But stock price is only a second-order indicator of success, Gelsinger said.
"First the company has to be healthy," he said. That's measured by internal metrics of culture, people, attrition rate; and external ones involving product strategy, customer satisfaction, and bookings growth rate.
Another important bellwether is the success of channel partners, Gelsinger said.
"VMware is a partner-, channel-centric company," Gelsinger said. "Five years ago, we had sort of lost that focus a little bit."
Rolta AdvizeX's Howdyshell said VMware's turnaround, anchored on "integrating the channel into their growth model," has validated a channel strategy for enterprise software.
"What [Gelsinger has] provided us over the last year is a true clear path for partners to build hybrid cloud practices and monetize the cloud," Howdyshell said.
As VMware looks to grow from an $8 billion run rate to $11 billion over the next year, and $15 billion in three, it needs the channel, which accounts for roughly 80 percent of all sales, Howdyshell said.
Rolta AdvizeX wants to double down on its VMware strategy because the conversation with customers has changed from tactical to strategic, Howdyshell said.
PhoenixNAP, likewise, is investing in scaling VMware services after a year of significant growth.
"Over the last 18 months it's been a night-and-day experience for us," Bell said.
FARM BOY TO TECHNOLOGIST
Gelsinger, who grew up on a Pennsylvania farm far across the country from Silicon Valley, has in his garage the first IBM 32-bit computer. That model No. 001 box is a prized souvenir from his years at Intel, where he was legendary CEO Andy Grove's protégé.
Partners say those contrasting traits of grounded farm boy and avid technologist have made Gelsinger uniquely well suited to lead a software company through unprecedented technological disruptions and corporate distractions.
His personal attributes -- discipline, stability, leading by example -- are almost a "manifestation of the product you want to buy as an enterprise consumer," Blumenthal said.
In turbulent waters, the CEO's down-to-earth style has steadied the ship, and made an industry starting to contemplate the demise of virtualization, and VMware with it, take notice of how a legacy company could adapt to the modern IT landscape.
Gelsinger sees VMware's transformation as one that both fundamentally changed the posture of the company and brought it closer to its roots.
"VMware was always this good, disruptive, innovative company. It always had that," Gelsinger said. "These secular shifts in cloud and containers have definitely challenged us. But we have demonstrated the ability to navigate through the changes while not fundamentally changing our business model, even as we're adjusting it to the new realities."
The transformation project is a work in progress. The next goal, he said, is shifting to subscription and cloud-based delivery models, which now account for 10 percent of revenue.
"You need to make these agile moves to these new environments, even as it risks your current business, disrupts your own organization," Gelsinger told CRN.
After successfully scaling the 19,341 feet to the summit of Mount Kilimanjaro, it’s clear that Gelsinger embraces risk, an attitude he undoubtedly brings to his leadership at VMware.
"Being uncomfortable has to become part of your corporate approach to the market if you're going to succeed in an environment that is only going to be changing faster going forward than it has been in the past," Gelsinger said.