Russ: Welcome back to The BusinessMakers Show. I’m coming to you today from the Hewlett Packard Enterprise campus in Houston, Texas, where my guest is John Frey, Sustainable Innovation Technologist. John, welcome to The BusinessMakers Show.

John: My pleasure. I’m happy to be here.

Russ: You bet. So, before I get into sustainable technology, I want you to share your perspective of Hewlett Packard Enterprise; HPE: Accelerating Next.

John: Yeah, Hewlett Packard Enterprise is one part of the separation of Hewlett Packard Corporation. We separated into Hewlett Packard Enterprise, which is really the Business to Business, or Enterprise, side of our company, and HP Inc, which has the PCs, the printers, the things that consumer folks most recognize as part of HP. But both are vital, both are very vibrant companies, and so we had a great opportunity to divide the company and really focus on the core customers for each part of that, and it’s been a success.

Russ: Ok and they’re very separate companies, right?

John: Very separate legal entities. We call it the two car garage; we both came out of the same start in Silicon Valley, we have that innovative DNA, but they are two separate companies with two separate customer bases.

Russ: Ok and Meg Whitman is CEO of the Enterprise group, but chairman of the board of the other group, is that right?

John: Meg is CEO of Hewlett Packard Enterprise and she is chair of HP Incorporated.

Russ: Okay, really cool. All right, tell us about the position you’re in, sustainable innovation technologist.

John: It’s a great opportunity for me. It’s a role that we created to say customers are getting more and more interested in not only the IT efficiency parts of their IT infrastructure, but they’re starting to look at the efficiency aspects of it as well around sustainability. So they’re starting to recognize that the energy we consume has an impact on the globe, and so my role was created to be that bridge between sustainability technology and IT technology, and say, how do we put those pieces together, help IT customers be more efficient while helping them make a positive impact on the globe as well.

Russ: Ok and efficiency also comes in the form of saving on their power bill, right?

John: It does. Saving on their power bill is one attribute, although many IT organizations don’t see their power bill and don’t pay it. They’re measured on a variety of other things like IT security and uptime, so sometimes energy cost reduction is not a powerful motivator for them. Obviously for their real estate teams, their finance teams, a motivator there. So, what we try to do is say, ok if you’re not being measured on reducing your energy costs, what are the things that you are being measured on where cost has a potential as well? Things like hardware cost, licensing cost for the software, maintenance agreements on that gear. So where we look across their data center and see 20-30, maybe even 40% of the equipment, powered up but not doing any work, there’s great opportunities to help them save money in those IT costs, but also in the energy costs as well.

Russ: Ok so how do you do this? I mean, do you come in and do a study, an analysis of the existing systems and their power utilization?

John: We do have the ability as Hewlett Packard Enterprise to do that. Generally the way these start is a customer is looking for new opportunities for improvement. Sometimes they’re saying, hey we want to know where technology is moving in the next 3-5 years. Or sometimes they have a constraint. So, for example, some customers will say, I want to grow my IT or I need to grow my IT but I’m physically out of space; how do I do that? Or, I’m physically out of electrical capacity in my existing data centers. And so their first thought leaps to, I have to build a new data center or I have to move. And we come into the conversation, well maybe you have some efficiency opportunities that exist in your existing infrastructure that if we improve there, would remove the barrier that you’re finding yourself hitting today. So we always suggest that the customers start there.

So I’ll have that initial conversation, tee up this path that I think the customer has an opportunity to walk down, and then if the customer decides they want to explore those options, we have teams of professionals in IT, in the heating and cooling infrastructure of IT, in architectural design, that will come in and walk through the specifics of their infrastructure and make a detailed set of recommendations. And some customers say, HPE, we want you to do that for us, and we’ll walk them every step of the way consulting all the way through, if that’s what they’d like.

Russ: Ok real interesting. I mean, I’ve heard/read stories forever about server farms consuming massive amounts of electricity and nobody ever seemed to let it bother them. All they knew is that we needed this horsepower or this processing capability, so keep adding onto it. So, I expect, I mean, when you sort of stack up the utilization of power from the grid, the whole IT sector consumes a significant amount.

John: Yeah, depending on which study you’re looking at, studies will say between 2-4% of the world’s total power is consumed by IT, and we know that’s on an upward trajectory as well. And so part of the opportunity here is to say, how do we have very efficient IT, how do we continue to grow but not have some of the inherent inefficiencies that are in the process today. So, for example, about 50% of that electricity that’s consumed by IT is not actually consumed by any IT equipment that’s processing data; it’s cooling equipment, it’s losses in electrical conversions back and forth as we go through some of the ancillary equipment. So there’s not just efficiency opportunities in the IT gear itself, but even in the infrastructure as well. In fact, one study says that the average data center has two and a half times the cooling capability that it actually needs, and yet, all of that cooling capability is running 24 hours a day, 7 days a week.

Russ: Ok, but I expect at the same time that modernization and new efficiencies have continued to be brought in to the IT world in generation after generation, which might mean that the older your equipment is, the more likely it consumes way too much power.

John: Absolutely. Every generation of server equipment we see efficiency improvement. So, more work done, per watt of power, but our demand for IT is growing at the same time. So, even though you might see on the order of a 20-30% improvement generation over generation in terms of performance per power, if your IT infrastructure is growing much faster than that, you can’t keep up with efficiency improvements.

Russ: Ok, so sort of back to your description a while ago about, you know, you being brought in and sometimes you actually reduce the amount of hardware in the center, I would imagine, and I guess the Enterprise group here still sells hardware, is that right?

John: We do.

Russ: Ok, and so I would guess also that sometimes when you’re going in to make it more efficient you’re reducing the amount of hardware. I wonder what your sales organization thinks of that.

John: Well, you know it’s an interesting conversation, and the sales teams that I tend to work with are the ones with large global accounts, and so they’re looking all the way across Hewlett Packard Enterprise’s portfolio. But the other thing we really try to focus on is rather than focusing on trying to sell something, we’re trying to help the customer solve business challenges. And so what we recognize is although as we go help a customer optimize, that might result in us selling a little less hardware, it might open quite an opportunity for professional services, but ultimately what we find at the end of this is a customer looks at us as a valued partner rather than a vendor that’s just there every time trying to sell them stuff. And, in fact, in many cases we then have access to the customer’s executives that our sales team has never had.

In one particular case, we had a request to come in by the CEO of the corporation; the sales team had never met with the CEO or his executive team, but because they were focused on sustainability and IT efficiency, we were able to come in as a consultant, which led to increased business with that customer.

Russ: Oh, that makes sense; definitely. So, I’m curious though, do your competitors also have a sustainable technologist?

John: I’m not aware of this position existing in the other competitors. They certainly have product compliance programs and sustainability professionals, and in many cases we work as an industry to drive many of these programs. But I’m not aware of a technologist such as myself in our competitors.

Russ: Ok, and your background really was in the technology, first, with always an interest in sustainability. Do I have that right?

John: That’s right, yeah. I actually came out of a technology background, came into the sustainability domain, and then as we started seeing this interest in customers, particularly IT organizations in customers wanting to make efficiency improvements, we needed someone who could bridge the language of those two organizations and understand the business metrics.

Russ: And there you were.

John: And there I was.

Russ: Ok, great. Good for you. So, kind of thinking ahead, too, you know when you look at the world’s focus these days on CO2 emissions and reductions and carbon taxes and exchanges and so forth, I assume this could also play a role there.

John: There are certainly opportunities that that presents as well. As we start really measuring that reduction and those reduction opportunities, and quantifying those, there are some cases where those reductions can either have benefit in terms of carbon reduction offsets; it could be used in another place for an industry that can’t reduce, for example, and some cases I talk to IT organizations and I say, hey, look you’re not paying your power bill today, as an IT organization; someone else in the company is doing that, but you know that’s coming and you know your real estate team or finance team. If you’re the biggest consumer in your company, they’re going to really try to drive that accountability a little closer to the consumption.

And so how about that you baseline where you are today, make these efficiency improvements in advance, and demonstrate that sustainable reduction, and then negotiate to keep 20%, 50% of those savings to fund IT mandates that you have that are unfunded. I’d actually had a CIO take that advice. He thought about it and he came back to me 3 months later and said, I didn’t negotiate for 50%, I negotiated to keep 100% of all of those savings. And they now use that to fund IT programs that they didn’t have funding for before.

Russ: You know it’s real interesting, when I first heard about you and your title, I said, what is this? I mean, is he recommending that people put up wind turbines and solar collectors to power? Which I think would be a little shaky right now. I mean, it’s just not quite dependable and consistent enough, but do you even head in that direction sometimes?

John: Absolutely. We actually have already publicly announced some research that we’re doing with the National Renewable Energy Center to look at how you can take a data center completely off the grid and power it with renewable energy, and use a different technology, actually fuel cells, as the battery backup if you will, that would take out the need for diesel generators for all the uninterruptable power supplies and things. Now, we’re years away from that actually happening to fruition, but we are looking at that because as IT continues to grow, there is a lot of public pressure on companies today, where they’re sourcing their power from; is it from a renewable source? You see many large companies with large data centers trying to locate them in very rural areas because it gives them access to hydroelectric power or something.

So, it is an area we’re spending a lot of time with, and HP has a lot of knowledge and a lot of expertise in mining data. For example, to be able to manage IT loads and balance them with renewable energy generation, which isn’t typically linear. For example, solar is really good during the day time, not so good at night; wind, when it’s windy it’s great, when it’s not windy it’s not. So, if you can manage your IT load to track with the renewable energy generation, then all sorts of things are possible.

Russ: Really interesting. You know, when you mentioned diesel generators I couldn’t help but recall a tour I took one time of a huge data center that had massive, you know, 4 or 5 huge diesel generators. And they talked about how the power company has a deal worked out with them because sometimes the grids need extra power, so they have to turn it on to help the grid out. That blew me away.

John: Well, and not only that, but diesel generators are typically the only place that companies with large IT infrastructures need air permits, for example. So there’s a whole regulatory burden that comes with IT operations when you start operating large diesel generators as well. Most companies that have them power them up on a regular basis to test them out, let them take a little load, make sure they’re transfer switches work. So there’s all sorts of implications that this shift to renewable might be really interesting.

Russ: Ok, well I’m just sort of curious, too. Before I let you go, I want to know this, because I mean, I think it’s very innovative what you’re doing, but how do you get involved? I mean, are you involved, does an account manager take you in to a new prospect call every time, or are you always looking at the legacy systems that exist today?

John: It could be all over the map. In some cases we are called in because a customer has a problem, and the account executive will bring us in to help brainstorm how we can use innovation or use technology in a new way to help the customer solve the problem. In some cases it’s customers saying, hey look, we’re designing our infrastructure; we’re thinking about it 3-5 years down the road. What should we know about the way technology is transforming? The advent of liquid cooling, for example, which we now have in commercial products, and that opens up all sorts of new opportunities. This research around renewable energy and how do you power something like a data center using renewable energy? They’re tough challenges, but they’re solvable challenges, and Hewlett Packard Enterprises demonstrated leadership along this path for many, many years, and so the customers are excited to hear about that, and that’s the kind of partner they want to do business with as well.

Russ: Your mention of liquid cooled servers, I mean, does that exist today?

John: It does exist today. It does exist today, and one of the things that we found is traditionally, servers were cooled with air, and so the analogy I like to use is, that’s like taking a can of soda, putting it on the middle of your kitchen table, and turning down the air conditioner your house to cool that can of soda. Of course none of us would do that. And so, liquid cooling is much more efficient, and so what we find is when we have high performance computing servers, such as at the National Renewable Energy Lab, the governments lab for doing high performance computing to do things like design solar panels, to design better renewable energy sources, we can use liquid cooling in our Apollo 8000 series with NREL; the liquid cooling then generates hot water coming off these hot components.

You cool exactly what’s getting hot versus cooling everything and hoping to cool what’s getting hot inside, and we can use that hot water then—they use it to melt all the snow on all the roadways all winter long, because NREL is in Denver; they use it to heat all of their buildings, and so when you think a little outside the box and say, hey, let’s look at this as a whole system rather than just IT as an isolated piece, then all sorts of things are possible. And, by the way, NREL saves a million dollars a year because they’ve moved to this liquid cooling infrastructure for their high performance computing as well.

Russ: John this is real fascinating; I really appreciate you sharing this with us.

John: Yeah, my pleasure. I’m happy to join.

Russ: You bet. And that wraps up my discussion with John Frey, the sustainable innovation technologist with Hewlett Packard Enterprise, and this is The BusinessMakers Show.