HITT- Technology Trends Recent issues around VMware, CrowdStrike, and Microsoft- July 23, 2024

Today’s HITT training is presented by Telarus VP of Advanced Solutions for Cloud, Koby Phillips. It’s a review of sorts of what some describe as this year’s technology trends or technology chaos, depending on how you’re looking at it, including some of the new and evolving technologies and the recent issues around VMware, CrowdStrike, Microsoft, and others. Now the news is not all negative as these issues and events create incredible opportunity for Telarus advisors. And today, Koby is joined by Sam Nelson, VP of customer experience, and my senior VP of sales engineering, Josh Lupresto.

Koby, Sam, Josh, welcome back to the Tuesday call. Good to have you all here.

Appreciate it, Doug.

Good to be back.

Hello. Hello. Long time no see.

We had to bring out the powerhouse lineup full for today. Kobe, this is gonna be a big topic.

Midyear Update on Technology
Yeah.

You know, as we advertised it, it was like a midyear update on cloud. And I started to think through it, and I’m like, what’s what’s really the best midyear update? And it’s really been the headaches and disruption that’s gone on in technology. So I decided to ask Sam and Josh, and they gratefully accepted, to join me and and break down some of these major things that have happened and, again, some of those opportunities that are being created coming out of that for our advisers.

I think the way that we wanna get this started off is really just hitting on some of those key topics and everything that’s happening with technology. And, of course, my screen just completely went away. Are you guys still there?

Kota there, you look beautiful here.

Sweet. Give me one second. I’ll try to find it.

There we are. Look at that. That was actually not a plug for disruption. It just kinda happened.

Importance of AI in Technology
But if we can slide over to that next, slide, the trends that are going on in twenty twenty four really start, in a highlight around everything AI. Right? That’s gonna be the one common thread that goes through every tech stack. And one of the major reasons that I wanted to have, Sam join us is the impact that it’s having and has had in CX for a number of years now.

But one of the things that she highlighted as she joined the company a couple years back was, hey. Great. You’re selling contact center, and we’ve really made this big push to get our advisers into selling contact center and really pushing it. And we always focused on the seat.

Expanding Product Offerings
And then Sam came in and was like, hey. Look at all this other stuff that you can sell on top of the seat, and you don’t have to go through and rip and replace everything, and you can add on to that. In fact, Sam, I think previously to joining Telarus, you had one of the biggest, if not at the time, had a hand in one of the biggest sales in the channel history, and it I don’t in around CX, I don’t think it had any any traditional seat. Is that right?

That’s right. Yeah. It was about eight hundred fifty k MRR, and it was only AI, which is really exciting. So it just kinda proves the point of, oh, it is possible just to sell something that sits on top agnostically.

So you’re right on track there. And just over the last two years, Kobe, as you mentioned, like, the the industry has changed so much, not just in the products that are available, but also in the way that we are having customer conversations and conversations with our technology advisers. Right? It’s no longer about these silo technologies.

It’s more about the bigger picture and how does everything fit together and support each other. So you’re spot on.

Impact of AI on Customer Conversations
Yeah. And when when AI comes into play in the conversation, it’s been really broken down into a couple of key different categories. You have CX based AI, which, again, has been productized, and we’ve been able to work and monetize now for quite some time, as well as what’s going on in in more my my area of the world, the the LLMs and everything that’s going around AI in that space. And that’s creating a lot of opportunity as well.

But it all comes down to a couple of key things. What’s going on with your data? Like, how do we get to your data? How do we create it?

What are we doing with it? How do we utilize it?

What I’ve noticed here is with AI, it’s also the pressure that the organizations are getting to, to go in and explore how to how to implement it. Right? So as your as an adviser, just know that most executive leaders are getting pressure either from marketing, from their sales team, but mostly mostly from other executives going like, hey. What are we doing here?

How are we what are we doing with AI? Are we gonna get left behind in a competitive landscape? And they’re looking for reasons to to explore it and to get into it. And, again, be prepared for for those conversations, and you’ll quickly understand, like, which way they’re looking to make an impact.

Opportunities Beyond Traditional Sales
CX, the expertise that we have in that all under Josh’s team, one of the major reasons we wanted Josh to join the call is how much impact the engineers and solutions architects are having and being able to decipher that and pull in other resources as needed. You know, Sam, what are you seeing as far as, like, the the opportunity on top of the traditional seat, all just around AI? We talked about the big win you had, but what are you seeing currently and then going forward? Are you seeing a lot more conversations are being started by that as well?

Well, it’s massive for sure because, as several of our technology advisers know, that a lot of customers made investments, right, in even on premise technology. And several of them, especially post pandemic, just either can’t afford or, like, technically, it just isn’t possible because of the solutions that it integrates with. They can’t afford to get rid of that on premise stuff. Right?

As much as we want to move people to cloud, in a lot of cases, majority of cases, it’s just not possible right now. And so what we need to do is look around the corner and say, hey. What else can we do to help these clients who want to take advantage of AI technologies and other ancillary products, and how do we help guide them into that conversation and have them look at the holistic picture. Right?

Interest in AI from Executive Leaders
It’s so interesting because about a couple weeks ago, I was in a in a virtual room full of about six CEOs, and it was so interesting to see what they were most interested in when we were kind of talking through AI with Jason Lowe.

They were really interested mostly in the use cases because they just didn’t understand exactly how something like AI would make an impact or how these other ancillary products would make an impact. Right? And for our TAs, it’s a new channel of revenue. Right?

You could still monetize the opportunity even though a customer may be completely invested in, you know, on premise stuff or stuff they already have. So the opportunity is absolutely there. It’s been validated with end customer events. And, Kobe, I know you’ve had several, end client facing, you know, opportunities as well.

Are you hearing some of the those similar thoughts?

Yeah. It’s looking for use cases is the major major piece of it and looking for guidance. It’s almost as though, like, if we’re I was an adviser. If I only had a tool that could help me go through some questions and sort things out and figure out what directions my customer wanted to go. And if I had something like that, maybe like a like a solution view, AI QSA, then it would be really relevant to those conversations. So, guys, that’s a shameless plug for our solution view AI QSA, to go along with the CX cybersecurity and cloud as well. That’s all available to you.

Alright. Bingo card. We checked off the the solution view. We checked off AI, and we mentioned Jason Lowe, which we need to give a big shout out to for all the work, that he and others put into that that tool. And I believe that, we have some other things coming out to help explore what’s going on with clients. But, Sam, to get back to your question, yeah, absolutely.

ROI Conversations and Efficiency
It’s really a couple of things. How do I take advantage of the technology that’s out there and utilize it safely? That’s the key point. That second part.

I always look at, like, cool technology innovation books. Right? And I, and you can insert whatever hot new tech it is right here. And then we go, okay.

Oh my gosh. Look what this can do. How can I use it? Okay. What else can I do with it?

Oh, oh, how do I make sure it’s secure? Right? It’s kind of that last that last rung of the cycle. And, Josh, I’d love to get your input on this before we we know we switch up topics here.

What are you seeing from your team and, the opportunities created as you said on top of, obviously, all of engineering and the solutions architects? What are some of the key trends that we’re seeing, you know, firsthand coming out of opportunities?

Exploration and Vetting of Technology
It’s a lot of exploration from customers. A lot of being bombarded with technology that they they are being told or they think is the next greatest thing, and then there’s a vetting process of either they’re looking at it because they’re interested and they were sold on the idea. Or to your point, to to the earlier point, they’re looking at it because the c level said we have to do something here. What are we doing?

And so I think the part that we’re we’re trying to help with, we released the, are we releasing an episode here on the podcast soon that will be go exactly to this with regard to to CX and AI. But if you think about what our role how our role is morphing in that a little bit with what we’re seeing in these discussions, I think it becomes a how do we quantify this? How do we help the business, owners, the decision makers quantify some of the costs of these purchase? Because maybe if I’m that CFO, I think everything’s fine.

We just invested in technology. Why are you asking me to invest in a new technology? Well, check it out. If I could give you, a new platform that eliminates your agent wrap time and does all the AI based summary and adds that component of it, and that saves us the cost on it itself, is that a platform that we should look at?

Right? So I we’re starting to see some of these ROI conversations, and I think that really becomes our shift of, you know, it’s not just a does this widget replace this thing and do this, you know, it it becomes a cost and an ROI. And and then not only this some of these technologies pay for themselves and existing budget, but it makes us incredibly more efficient, and it drives profit up in some of these, you know, in some of these call centers and things like that. So, a lot of things as it relates to that and certainly a lot, around the, hey.

Data Preparation and Role-based Access
We wanna build an LLM, or we wanna integrate with Copilot, or we wanna integrate with OpenAI.

We we can certainly go a lot deeper on this because it’s it’s a okay. But have we done this part yet? And so there’s a little bit of a crawl, walk, run-in this part. I mean, getting the data in order. Is the data sanitized? Is it structured?

Is there role based acts? Access? You know, we we get back to we we can’t build on the house until we have all the parts of it. Right? And getting those parts in order, I think, is where that data comes in.

Yeah. And and speaking of you you triggered the word house in my head. And, just for our TA, some some buzzwords that you’re gonna continue to hear. And, yes, Telarus talks about AI a lot. There’s a reason.

Continued Focus on AI and Education
Everyone’s talking about AI a lot, and we wanna make sure you guys are prepared for it. So we’re gonna continue to you’re gonna see continued focus around it in education and really the the overarching opportunity. And one of the things, like, within cloud that you’re seeing is the creation of something called, like, a data lake house. Right?

You take a data warehouse or data lake where you have structured, unstructured data, and we’re seeing or, seeing our suppliers pull those in, structure the data in alliance with whatever AI component they wanna use that you’d mentioned, Josh, and then safely and securely pull that through. So if you guys are looking for those type of opportunities, we’re seeing more productization of that through, number of different suppliers, and that’s exciting. So we’ll start to see the catch up of that. But this really triggered a lot of things.

Productization of Data Lake House
And so in cyber and we’ll put a bow on this particular topic and move on. But, like, in cyber, everyone’s like, hey. What are your cybersecurity AI products? And, like, well, in cybersecurity in particular, AI has been embedded for a decade.

Right? Like, I remember seeing, Darktrace, which is utilized by a few of our suppliers, do a demo where they use AI to scan anomalies, attack it, remediate, and then put it away. And that was seven plus years ago that I I sat there and watched that demo. So, I mean, AI has been a major component in cyber, in CX, and in cloud.

Integration of AI in Cybersecurity and Cloud
You’re just gonna see more people and more organizations take advantage of it, call it out, maybe even pull out, make make specialized products around it. And so as we see that, we’re also gonna see the pretenders where they come out. They’ll, you know, this is AI based and and this and that. So pay attention, utilize your resources, make sure that you’re you have factual information as you go have those conversations with your client, and see what they’re really looking for.

There’s a couple different rows that they can take on this, and we’ll be able to, help utilize that and then push that through. So if we wanna move on to the next topic, I think we we hit on AI, but this is what’s really going on outside of the the fun AI conversation. We got organizations that are just looking for help on a few key areas that that have come out. Right?

Understanding Client Needs
So this is, this is something that I really enjoy about our our our job is we get to we get to have a really cool unique seat, get to talk to great advisers, amazing suppliers, and then really, really cool unique end user customers as well. Like, we get to see all different angles of what’s going on within the technology, you know, sales experience as well as just what’s going on and what’s driving those opportunities. And if you wanna move to the next one, you know, this one oh, one more.

Is really gonna be the the one that created just a ton of opportunities, in particular in the cloud and the infrastructure space. And it it pulls through, and it’s actually affected a little bit of everything. And, Sam, you know, I’ve talked about this offline.

Impact of Broadcom’s Acquisition of VMware
This thing shook up a lot of stuff for organization. So just a quick catch up, Broadcom bought VMware, switched from, perpetual license to subscription based, but there’s a lot of ripple effects around it. They started to do some bundles, change their pricing. And really, at the crux of it, if you block out a lot of the noise because they also changed our partner program.

They sold off other products like VMware Horizons to, a PE firm. They they started everyone’s like, hey. What’s going on with VeloCloud? At their core, for virtualization and with the products that they had in those those categories, they put them into a couple of bundles.

And what came out of that is really a a cup a couple of conversations that you can have with your clients. There’s three options that clients can take when it comes to this. Do nothing and roll the dice on what their price increase may or may not be.

It will be a price increase. It could be as little as hundred percent to, the worst I’ve seen is fourteen hundred percent. It was one time, but most of the time, it’s landed between three to eight hundred percent increase just because of the way that they changed it. Quick background as to why.

They really went from and Josh jump in because you’re far more technical I am, but I’m gonna try to keep it high level. They went from basically metered RAM type of billing to and host if you so in layman’s terms, hey. You used to be able to spin up as much as you want and use as much as you want. That’s what you paid for as far as virtual machines go.

And And now if you spin them up and you use it, you’re paying for the whole thing. So it also really triggered a lot around disaster recovery strategies happen to be changed as well.

Any tweaks to that, or did I nail it?

No. No. No. I I I think that’s fine. I think people people knew how to gamify the system, before.

You you could stack up RAM. You pay for that, and then use all the CPUs you want. And now the thought is, okay. The CPU usage and billing requirement changed, and by the way, there’s a minimum amount of CPUs.

So you think about, you know, these licenses that you have to have, and you should just spread CPUs across all your VMs. So now you’re required, I think, what it was, eight or sixteen minimum, CPU cores. So that might change if I only need two here and two there, but I’m required to buy buckets of sixteen.

Okay. May maybe that changes things for me. And so, you know, in that model where people were very reliant on not paying for the CPUs and they had a ton, but they spread the RAM apart. You know, it just there was a way to gamify it, and and now there’s not.

Broadcom’s Strategy and Impact on Customers
And I I think, you know, Broadcom is running a, you know, is running a play. They know how to convert this to SaaS based revenue, and they’re just sitting here saying, hey. We’re we’re Broadcom. We’re VMware.

Fall in line.

Yeah. And Broadcom, said, hey. We’re prepared to lose thirty percent of our our customers, but we’re gonna double EBITDA. Right?

And they’ve run this play before. And, you know, by stacking other products that weren’t as utilized into those bundles, allowing customers to to take advantage of those with the cost of their their key products. They’re looking to go, hey. If you wanna save money, then cut out your other vendors and just use our products in these.

And that’s one that’s one take on it, but also the billing changes. And, you know, I opened up this part of the conversation saying, hey. This affected CX too. And Sam, when Sam and I talked about it, it wasn’t really a technology effect.

Impact on IT Leaders and Emotional Conversations
It was really more of a business effect. Because if you looked at what happened, I’d I think we’ve all worked with IT leaders for a long time now. I’ve never seen one that likes being told what to do by their vendors or really anybody that likes to be told what to do as a customer by who they’re buying services from. And so there’s been a lot of emotional conversations that I’ve had with, clients, with our advisors, and things like that.

And it’s really come down to three options. It’s do nothing as we just talked about, optimize to the new environment and stay on VMware, or migrate away from it. And the good news is it’s creating opportunities for our advisors. And if you simplify to those, really, those type of conversations, like, hey.

I know this you got about and by the way, advisers, they own eighty percent of the market, and most organizations virtualize.

I’d say ninety five percent plus use virtualization in their environment. So if you do the math, you got about an eight out of ten chance of having a a conversation around this as impacting one of your clients.

It’s really, hey. How is this impacting you? What’s your game plan? And what options do you wanna look at?

Do you wanna do you wanna stay on VMware? We got some great options, and we can help you with the organization to come in and help you optimize to that new environment that they’ve created. Do you wanna migrate away from it? We’ve got some really great options there as well.

Pause in Tech and Impact on Other Areas
And then, you know, if you do say kinda just good luck, and we’ll talk to you in about, you know, whenever your whenever your renewal period comes back around, or whenever you are able to make a move. And the way that this really again, to tie it back in, the reason why it impacted everything else in tech is it caused everyone to pause. I’ve used this analogy where it’s like you’re remodeling a house, and you’ve got through with the kitchen, and the kitchen’s great. You love the backsplash.

You love the appliances. All the things are good in the kitchen. And you moved on to, like, a bedroom, and you’re doing maybe you’re doing an addition. Who knows?

Maybe you got crazy, and you’re like, hey. Let’s let’s make the house bigger. So you went through. You got all your permitting.

You’re you’re ready to go. In this analogy, permitting’s demos. You’ve explored all the different options. You’re starting construction.

You’re starting to get some POCs in there. And then all of a sudden, a pipe burst in your kitchen, and you gotta go back and you gotta you gotta address that or you’re gonna have a flooded house and beating more billing and just things that you thought that you already had taken care of. And so, essentially, what’s ended up hap happening is the idea around tech is they had to press pause on a lot of other things. So we saw, like, like, some some major pause buttons hit on cybersecurity opportunities.

See you know, Sam, you you’d mentioned that you saw some some stuff that was slated to to close opportunity wise and then press pause because they had to go back and address a lot of these other things going on within that IT organization.

Impact of the Pandemic on Technology Strategy
How much of an impact did you see there overall? Was are you a back loaded second half is what I think we’re looking at as far as just, like, funnel and opportunity overall?

Yeah. I actually saw quite a bit of it, because post pandemic, I think everyone what happened was everyone tried to kind of revisit what their strategy looks like. Right? In the heat of the pandemic, we’re like, okay.

We gotta go virtual. Let’s, like, create these hybrid environments or completely remote environments, which was great. So we made the pivot really, really quickly. And, like, kudos to the suppliers who’ve made that happen.

But now everyone’s going back and saying, hey. Let’s look at let’s take a closer look at what we implemented and figure out, is this the right path moving forward as we’re starting to see renewals from those pandemic decisions? Right? So, they’re looking at things like infrastructure, like the security around what they’re actually using today during all these reevaluations.

And then on top of that, though, Kobe, we’re seeing more decision makers now involved in an opportunity. Right? It’s no longer just the IT person or just, you know, the the operations person. We’re now starting to see marketing leaning in, sales leaning in, like you mentioned.

Right? And that’s that ripple effect where we’re now seeing the CEO saying, hey. Marketing and sales are coming to me, and they’re trying to, you know, get AI in here, and they wanna make sure that this overall solution benefits them too. How do we do that?

And so we’re not just seeing delays. It’s more like, hey. These sales cycles are taking a lot longer as customers are evaluating more solutions holistically, if that makes sense.

Involvement of Decision Makers and Extended Sales Cycles
Yeah. And I think the the opportunity for advisers is this.

You know, Sam sits on top of a practice. I sit on top of a practice.

Our our peers with Jason Stein for cybersecurity and Graham Scott for advanced networking mobility IoT.

Damn. Graham’s got a long title.

And the the longest part of it is you have the opportunity to sell the entire customer. So, like, as you go through these projects and if you hit a delay, get curious. Hey. What’s causing it?

What other things are you guys working on? I’ve seen that work time over time over time to be able to work, to get into other opportunities, create some value, across the board. And even if you’re a specialist, even if you’re a CX specialist or cloud specialist or network specialist, you have the opportunity to bring in resources to help expand and answer these questions to your clients. This particular topic is great as a door opener into areas if you haven’t worked in infrastructure and haven’t started to sell in more cloud based services.

Like I said, you got about eighty percent chance of having a conversation, and it can be very simple. Hey. How’s this affecting you? I know I have some options.

Let me grab some resources, and let’s have a conversation. You’ll hear me harp on this every time that I get a chance in a platform to do so. Fifty three percent of what drives customer loyalty is sales experience. So if you’re not you’re no.

You don’t feel like you’re an expertise or an expertise sorry, an expert in this space.

You have resources that are and focus on creating a world class sales experience. Those other categories out of the that make up that fifty three, just so you guys don’t think I’m making stuff up, is nineteen percent’s company and brand, nineteen percent’s product and solution, and price rounds out the remaining nine. And that comes from the challenger customer, which is actually a customer experience based, book coming off the challenger sale. So that is the crux of where I always push our advisors and challenge them.

Importance of Sales Experience and Customer Loyalty
Like, hey. If you’re not doing this now, go ahead and start. You’ve got people that have your back, and we’ll come through. We have a great cons great methodology how we approach these conversations.

And the next one that’s big disruption is, Sam, kind of more in your, swim lane. If we wanna move to the next slide, was this. Right? Microsoft Teams got decoupled. I love I was so happy I found this graphic.

I thought that this is perfect. It’s like, hey. Where’s my stack? And then they pulled it out. You know, I’ll I’m gonna kind of let you run with this and go, what what did you see when you you you wrote an amazing guidebook, along with the team and put that out for advisers?

You know, what what disruption did you see and what opportunities are still coming out of this, for for the advisers to take advantage of?

Yeah, Kobe. This was interesting. And, yes, kudos to you for finding this graphic. It’s like the meme that just says nope in the top at the top.

So this is this is perfect. It’s perfect visual. So okay. Let me back up on the whole Microsoft Teams unbundling.

And for those of you who have seen the guidebook, it okays to you for finding it. FYI, it’s we have a customer facing version as well that helps guide not just you to have the conversations, but arms your customers with an overview of the changes and what they can do as a result of the changes. So what happened exactly? I remember that day, April first of this year, checking my inbox, and all of a sudden, just emails flooded, the inbox with, hey.

What’s going on with Microsoft? What’s the deal with Teams? I’m checking the news. Honestly, we all thought it was an April fools joke because it was April first twenty twenty four.

But Microsoft did announce that they unbundled Teams from their Microsoft, or o three sixty five offerings. Right? And so this created a really interesting opportunity in the industry since. Now your first question is, okay.

Well, why did this happen? Why did they decide to do that? And the reason for that is because you’ve got antitrust regulators actually warning Microsoft, saying you’ve got an unfair advantage compared to the competitors out there. You have to you know, we we strongly encourage you to unbundle this.

Right? In fact, Microsoft did this last year in Europe, but now they’ve officially made it global to where now moving forward for new customers, with the exception of nonprofit government, right, and some education, for new customers, Teams does not automatically come in the Microsoft bundles.

Okay? That is a really significant opportunity for our technology advisers, as well as for customers. Because what it does now is it actually forces customers to look for collaboration tools to complement their Microsoft licenses.

Right? So as you can imagine, Microsoft, now that Teams is unbundled, Microsoft went ahead and upped their prices on bundled licensing to accommodate for the lack of Teams being in there. Right? So Teams is now sold separately.

So for you, technology advisers, this is a great opportunity to start talking about different collaboration solutions that fit well with the Microsoft bundles for all new customers.

And we’re continuing to see a ton of momentum as a result of the announcement on April Fool’s Day, which is not a joke, but seeing a ton of momentum now of, hey. You know, what do my customers use, for collaboration in conjunction with their Microsoft, you know, Office, the three sixty five, all that good stuff.

And we’ve got a ton of providers and a ton of suppliers in our in our portfolio who can help complement those licenses. Right? And they in fact, they do it really, really well. In many cases, we even have suppliers who, displace teams altogether. Right? Because the collaboration component is that essential.

So, yeah. So, hopefully, that helps.

I believe, Doug went ahead and popped the unbundling explained guidebook in the chat for everyone. So if you haven’t checked it out yet, definitely check it out. But it’s, it’s definitely something that’s continuing to disrupt the space even today, months later.

Yeah. It’s it was, it was like one thing. It’s I mean, it’s been this all year. It’s one thing after another.

Constant Changes in Technology
You know, if you guys happen to join us pre call, we know we’re live and we’re just having conversations. And I said, Josh goes, hey. Anything any other major events in technology change? I was like, I was reading up on, like, the Citrix license changes.

That kinda snug past everyone a little bit, last night. And he’s like, what? And so, yeah, there’s there’s always something coming out. This one, again, the timing of it was pretty hilarious with it being April fools, and and getting that out there.

Hopefully, you know, advisors, you guys see value in those guidebooks. We did put one out for VMware as well. We’ll continually put those and drop those in for you guys, as relevant things happen in tech to give you again, it’s just a guidebook on conversations, what’s going on, a little bit of the background so you feel more comfortable, and it’s a easy resource for you to go grab and utilize. We’ll always try to make sure that you have a customer facing, version of it so you can get it out to your organizations that you’re looking to help as well.

So, I mean, that’s pretty much all that’s going on with Microsoft. Right, Josh?

I mean, just the Teams deep, but, like, nothing else made a thousand Just just just another day.

Just just another day. Yeah.

The Azure Central Outage and CrowdStrike Update
I mean Other than that one thing.

Right? And this is this is an awful segue to try to be funny, but because there’s nothing funny about it. Especially if you’re traveling on Friday as I was and got a fifteen hour delay. And I was one of the lucky ones that actually got home, on Friday. So if we could flip the to the next slide, and we all get to see what everybody’s been seeing if you’ve been into an airport in the last few days, which is just a big blue screen. And, Josh, you know, CropScribe’s or CrowdStrike’s taking a beating here.

You’re seeing Microsoft getting drove through the mud a bit as well, and it’s being called the biggest IT outage ever.

You know, what what do you think happened here? Or what do you what are you reading about? Or what have you been caught up on?

Man, so it just like any good crazy thing, it was a series of things. And so, let let let’s break down what happened, first of all. So we flash back to last Thursday.

Later in the day, Thursday, a routine, thing happens in Azure Central. So there’s there’s there’s two outages here that kinda got made this hard to figure out and understand what was happening in the beginning. So so late Thursday, Azure Central starts having issues. They investigate this, and and what happens, it comes to find out that just like any good, you know, infrastructure provider, they’re updating hardware.

They’re updating things on the back end. They pull, servers and storage output, new servers and storage in. And when that happens, you know, it it says, hey. I’m here.

I have an address. Use me. And so this thing this allow list, that all the VMs on Microsoft and Azure in storage use back and forth, IOs to storage or IOs to VMs, things like that, say, hey. If you’re on the allow list, we’ll use you.

Well, something happened on the back end for the gear that was pushing out the allow list of saying, hey. Here’s all our infrastructure in the entire Azure central region that’s available.

Well, the allow list wasn’t pushing out the full addresses of the devices that were available to be used for storage. And so then there then that that created a catastrophe that the VMs were saying, woah. That address isn’t full. We’re not gonna take any of that.

And so you lost a lot of these right privileges, and you lost, input output capabilities from any of these storage. So then what does that do? That that then steamrolls into, you know, the Azure Blob storage, into OneDrive, into SQL database, into their, into their NoSQL database, into their Cosmos. So it just goes and goes and goes and goes.

So timeline wise, that took about twenty four hours for them to fully come back up. Halfway through, they started to get back up. But, what like, any good Friday morning in an IT guy’s world when they’re thinking about maybe taking, you know, a little bit maybe I’ll leave early. Maybe I’ll leave at three today.

You know?

This happens. So between Friday morning around four AM while everybody’s sleeping, this CrowdStrike update happens, seemingly inconsequential update. Right? It says, hey.

We’re just just like the other hundreds of updates that CrowdStrike has pushed. We’re gonna push these updates. And, you know, if you there’s some cool analysis going into what happened in this, and there were the the the breakdown to simplify it was there was a code change. And in that code change for CrowdStrike’s Falcon platform, it it simply said, hey.

Let’s point to this section in the code. And and the oops was that didn’t get caught in QA was that section of the code should never be pointed to because that’s where the system drivers are. And any any programmers that understand when you point to a system driver when you’re not supposed to, bad things happen in Windows world, and that bad thing is blue screen of death. And so okay, cool.

Code Issue and System Failure
Should just reboot. Right? Nope. Because you’re stuck in this cycle where you’re referencing a a point of the code that that shouldn’t have been referenced.

And so these boxes, these computers, these wherever they might have been offline, and they had to be manually touched every single time. And that’s what caused the start, and we can talk about this so many other delays and breakdowns.

So if for someone like me who likes to simplify things down and try to put it into some kind of humor, basically, the code became the Austin Powers where you try to do the turn in the mini car, and it just kept going back and forth and back and forth. It couldn’t get turned around, and it couldn’t go straight or backwards. It was just stuck. And it was bouncing between the two.

And it was just one thing. It was it was a couple of things that triggered the effect that’s been happening in, like, all things. Right? So let’s let’s address a couple of things.

A, there’s probably gonna be still like you said, there’s there’s more that’s gonna probably come out and and things like that.

But But let’s talk about the opportunity this presents.

The first thing that came out, if you notice the first statement that I read that came out of this, this was not a cyber attack, from the CEO of CrowdStrike who immediately as a cybersecurity company, he was like, hey. Our our product’s good. We just made an error in deploying it. Right? That’s that’s the way that I read that approach.

She owned it.

And so he’s like, hey. What we’re supposed to do, we’re still good at. We just didn’t do it the right way.

And he I’d still think they took a a pretty massive beating on the street, from their stock price. Everything I saw was was pretty brutal.

The way I found out of it just for a little bit more humor in the airport was a couple of people walking around because got no updates from the from the airlines because they weren’t able to. So you just show up. And I had an early, an earlier flight that day. And, essentially, it’s just a couple of people yelling, Microsoft had a global outage, and all systems are down.

And that was just ringing throughout this, you know, airport. And I was like, man, this is just like a rough day for for Microsoft. But it’s, it’s it is it is a big inconvenience. But it also shows the opportunity.

Opportunity for Cybersecurity Conversations
The opportunity, again, is a conversation that can happen. Cybersecurity has already been one of the biggest conversations in disaster recovery, business continuity or resiliency, and managing risk. All of these things are major conversation points that our advisors can have with with their organizations. This just shows another log on an already pretty big fire to have those conversations.

Selling it’s a different story. So I’ll soapbox for about two seconds here, and then and then we’ll get back to the conversation. In order to sell cybersecurity, it it’s not just a singular conversation and a singular solution. It’s it’s an architecture that involves many different components and aspects. And you need to be able to come through and have a as almost a guided selling conversation and the ability to, like, drive that conversation with them and give them a step one and give them a, hey. Here’s how we’re gonna approach it and then and guide them through.

Selling Cybersecurity
Not to overplug our team here, but you have a a great team of resources led by, you know, Jeff Hathcoat as our solutions architect. Jason Sine is our our cybersecurity practice lead. But you have a a few other major players, not the Jason Kaufman, Josh Hazlehorst. I I could just name the entire team because we put so much emphasis on cybersecurity.

Just Trevor Burnside one more. And these are all guys that focus and specialize in it, have the certifications, but also have the experience in helping customers figure out how to attack a step one. Take advantage of the opportunity. This is obviously a huge inconvenience for for millions of people most likely at the end of the day.

And unfortunately, just like with COVID, inconvenience drives opportunities in our space and have a have a game plan and have a playbook to take advantage of those. And if you look through everything that’s going on in tech in twenty twenty four and really anytime previously, technology is never perfect. That’s why we all have careers in it because we’re the the ones that stand up there, try to figure it out, try to implement it, and try to build right solutions.

Impact on Airlines
But it is anytime there’s a huge, you know, inconvenience, it creates a huge opportunity for us in conversation. This is just another one of those. Understanding all of the ins and outs of it is really interesting, but you’re gonna have so many different variations that customers hear and get to. Just be prepared to say, hey.

You know, unfortunately, all that happened yet. It happened to a number of airlines. The one that I was on, I won’t mention them by name, although it rhymes with Walter, has still been crippled by it. In fact, if you guys want a good, you know, x follow, formerly Twitter, Southwest Airlines right now is just killing it with some of the stuff they’re putting out there.

They’re like, yeah. We haven’t updated our technology since nineteen ninety nine. Who’s laughing now? So, like, they are doing a great job with humor around this.

But, you know, Josh, any other things that that you see or, you know, Sam, feel free to jump in as well as opportunities for advisors to to chat in in this particular conversation?

Interconnectedness and Customer Conversations
Yeah. I think, you know, appreciate all the kind words for the team. I think what’s great about this team is that, collectively, we’re trying to disseminate what what is happening out in the world today, yesterday, tomorrow, and then we have to go and have a lot of those conversations. And how do we help advisers translate that to meaningful conversations with existing customers or with prospects? And and there’s a couple takeaways from this.

One, I I think people forget how interconnected everything is. Who would have thought that Delta’s crew staffing system would not be able to handle the workload and would crash as part of this?

Who would have you know, we could say who would have thought, who would have thought, but the the walk away from this is if you think about the interconnection between, obviously, with Microsoft, with one percent of their, you know, hosts going down with this, you think about the CrowdStrike thing, how many people were on and dependent on that platform.

The question I would be asking your customers and your prospects is in in the light of all these recent events. Like, security has its own strategy, certainly, of how to help customers and prospects with that. But if you just back up and say, how you know, what are you dependent on? What SaaS providers?

What hardware providers? What what other components in your infrastructure that you have absolutely no control on are you dependent on? And do you have a plan if one of those fails? I hope they don’t.

I hope you don’t ever have to use this plan, but I would really I think that becomes our job in this increased complexity and all this interconnection. It’s hard to to to see this, affects that.

So I think our customers depend on us for that, of helping them visualize oh my gosh. I didn’t think of that. I was just thinking I gotta rip out CrowdStrike. Like, okay.

Maybe your endpoint is part of the the conversation, but what else? What what what else are we dependent on? What other SaaS vendor that is gonna have an infrastructure outage or whatever hardware component in the environment is gonna fail. I just think it paints a big big picture of, have we looked at all these dependencies?

Do we have a plan if one of those fails? If not, let’s talk about it, and let’s see if there’s a way that we can help.

It’s kinda humbling. Right? Think about how we opened up the conversation. AI and all this amazing stuff that’s happening and all this stuff and talking about, like, the the the ability to have robots do this, this, and this.

And I was having to get a paper boarding pass, to get through security because of a technology failure. So it is it is an interesting world that we live in. I feel like we’re kinda right in the middle, and and we have been for a number of years now of this revolution of technology that can be taken away from us just like that. And this is another example of if you don’t have a backup plan or you don’t have that resiliency to what you’re just speaking about, Josh.

You’re kind of in a in a boat where you’re gonna be put back right into the nineties real quick. And that is essentially, the way that I felt in traveling. You know, Sam, I’d love to get any last words from you as we we hand it back over to Doug and and wrap our segment up here.

Sales Perspective and Opportunities
Yeah. I think all great points from a sales perspective. I think the reality is, especially with AI, we tend to look for what’s around the corner, for what’s next, what do we need to be ahead of, where is the industry going. But the reality is that the opportunity is right here right now, and this was a perfect example of that.

Right? It’s clients who, you know, don’t have the redundancy built in. What is their strategy around dependent items, the opportunity is very much there today. So don’t get too caught up in the stuff that’s around the corner.

That’s all exciting and great. Look at what’s going on right now with with clients and what they’ve got.

Yep. And I’ll wrap up and hand it back over to Doug. We are a consumer driven channel, guys. If you look at how we all make a living, it’s on stuff that people are buying from us.

Summary and Sales Strategy
And while the bleeding edge tech is cool, and that’s why we wanna give some focus to it to have those conversation pieces to help you and help organizations that you support get ready for it, Go back to that sales experience thing. When you sell on the bleeding edge, sometimes you bleed. And while it’s available to you, you gotta have that good game plan and a good backup plan, and that’s all the things that we have here to help you guys and support you with in our resources. And, thanks, Josh and Sam, for jumping on with me and having an in-depth conversation, some of those big disruptors.

It was a lot of fun on my end. Hope you guys enjoyed it, and I hope you guys all enjoyed it as well. Doug, hand it back over to you, sir.

Thanks, Kobe, Josh, and Sam. Terrific presentation. A lot of good participation from our partners as well. These three will continue to be online here. They’ll respond to a few of more of the, questions and comments in the chat, so feel free to keep those coming. One thing I just wanted to bring up here and kinda summarize a few of the questions that have come in.

I think it was Zachary just jokingly mentioned time to invest in paper or something like that if you’re looking for a place to put money. But from a serious standpoint, you touched on the fact that we’ve got some bleeding edge technologies, but we’ve also got some very mature technologies that are assisting in remedying some of the problems, concerns, questions that come up with some of the, leading edge technologies.

What can our partners do in terms of both preparing themselves to talk about the leading edge technologies, but then recommending solutions that may help their customers to take advantage of existing mature technologies as well.

And no no way am I saying this is, like, as a bait and switch analogy, but AI, some of these these bigger bleeding edge, you know, these more new age exciting technologies are really good fishing lures to start conversations. But then as Josh and Sam both kinda hit on in in our conversation previously, it’s like, are you prepared to implement them? Right? Or you’re just gonna be spending money and throwing it away because you don’t have the right infrastructure set up or you don’t have the right, go to market approach, you know, and and more of that CX space of, like, how you’re gonna implement it, how are their agents gonna consume it and drive to the result that you’re looking to get out of your investment in technology.

And so if you take, if you begin, don’t sell the product, sell the customer. Like, take a step back and look at all of the things that they have going on and understand where they’re coming from on their ass, that opens up a ton of different opportunities to then go and explore all these different things. So, hey. We’re looking at AI.

Great. What are you looking to get out of it? What are you what are you looking to drive the organization to? Is it just a a me too thing keeping up with the Joneses, or is there a use case that you’re looking to solve for?

Or are you looking just to explore the technology and see where you can put it in to play? And if so, do you have all these other components? Like, it’s almost like a checklist that you would go through.

And that is a little bit of a plug for something coming down the pipe, that you guys are gonna have access to. So these checklists and things like that on these on these bigger technologies to set up not just one opportunity, but multiple. And then you start to you start to go through your your sales process that you have with your clients and really and put them in a in a process that creates a really good experience.

And with regard to those sales cycles, Vinny asked a great question earlier in the chat. Are you finding that sales cycles for newer technologies are a bit longer in many cases, and are the sales cycles for some of the existing technologies perhaps shorter and, maybe a quicker resolution, quicker dollars, for our partners?

I I was gonna, I was gonna call out that one because I saw that question earlier. I thought that was such a great question.

Yeah. I think if if, you know, people might have had a preconceived notion of the thing they were going to buy or the thing they were already, you know, invested some resources in, and then this new technology comes along, and then they have to pause and then research it, understand it, invest in it. Right? And, we all have to be involved in that process.

You know, none of us wanna hear the customers say, ah, I didn’t know you did that. Oh, I didn’t know you could help me with that. It’s so it’s always so frustrating, I know, to partners, advisors when you hear that. And I think whether we’re reacting to a message about, hey.

Can you help me with AI? Or we’re pushing the conversation of what are you being tasked to do with for the business with regard to AI? And just take it you know, I’m just picking on AI as an example or CX or cloud. What are you being tasked to do with it?

Why are you being tasked to do with that? And what to Kobe’s point, what’s what’s the desired business outcome of that? And then we’ll figure out where the technology fit is. But but I think in that, what we’ve learned is that this goes cross organization.

So I cannot stress a multi pronged approach into these accounts, now more than ever. Right? Because what what helps cloud might impact security and might impact the director of operations and all of those things, I would say make sure that all those people are involved in that conversation. And so the question I I I would ask back to the earlier part of what I was saying is, who’s all involved in these conversations?

Right? Is it is it just you or do we now need to kinda pull in the the customer success team or do we need to pull in the somebody from the security team so that make sure they have representation? Because I don’t they may be going to doing something on their own. We’ve all seen that a lot of times.

So we wanna get all those stakeholders I think in the sooner the better. And as you can pull that into then you just get multiple champions in the organization. And then if at a minimum, what that does is it gets everybody on the same page because that happens a lot in these companies. The people just aren’t quite on the same page with this department wants to do with this department wants to do.

So if you can be that unifier, you’re gonna be that benefit, that beneficiary of it in the end.

Tools and Methodology for Customer Engagement
Yeah. And, Sam, I’ll I’ll I’ll call this out because I know you’re a big fan of it as well.

We both Sam and I, as well as our our peers, we’ll give some trainings on how to weaponize some tools, like a mutual action plan in doing exactly what Josh has said in keeping track of not only what’s going on in the project, but, like, the key players of the stakeholders of the customer, at your suppliers, and things like that as well. There’s some tools that you can use to help give your you know, create a methodology of approach to the to that exactly what Josh said. And to to take a stab at answering the question as well, it depends on the customer. I know that sounds like a little bit of a, like, a cop out type of answer, but it’s not.

Customer Engagement Time Cycles and Impact
And here’s why. If the customer has a use case, they’ve done their own research, and you’re simply just helping them with the transition to get it in in place, that that’s relatively pretty quick. But if they’re just exploring it into and they you gotta open up the opportunity with the organization, It’s gonna be a longer time cycle, but you there’s a good chance that you’re gonna get more out of it. As an adviser, you can expand out in those conversations and get wider into the organizations, especially mid market to small enterprise.

That’s where we we continue to see the most impact. You’ll see that coming out in some of the reports that that you’ll see from us. Mid market, small enterprise, that’s where our advisors are having the most success, and we’ll continue to have the most success. It’s a pretty simple answer as to why they lack resources and skills that you guys are able to bring to the table with, you know, your relationships with suppliers and and and Telarus and others and bring those in and help give them a game plan on how to go from there. Some fun stats. Fifty percent of IT projects, no complete. Twenty percent, complete on time.

Improving IT Project Completion Rates
I attack that stat all the time, and that’s where we do a lot of our methodology training. Why? It’s a low bar. If you can improve that, it’s gonna make a pretty big ripple effect.

And if you can start to get into the psychology of what happens in these IT organizations and the bigger impact, let’s take one of these examples. Any of these, you put the technology in place. It allows the organization to do something else. There’s a bigger ripple effect other than just that solution and how it how it triggers.

So if you ever look at it like, hey. We need this we need to go get our back end infrastructure cleaned up so we can go create products a lot faster to give to advisers. That’s a conversation that happened at Telarus. We have to go do this project that’s gonna take this much time to then go do these projects to then create a product that’s gonna allow a a better advantage for all of our, conversations.

Strategic Client Conversations
The the biggest thing there is who you’re talking to with these with these leaders at your group at your clients and then figuring out where to take those conversations.

I’ll get off my soapbox, Doug, so we can answer a couple more questions before we conclude here. Sorry about that.

I think that’s gonna do us. Great presentation, all of you. Again, chat window’s open if you have a few more questions, but I’ve gotta move on. Thanks, Kobe, VP of cloud, Sam Nelson, VP of CX, and Josh Liparisto, SVP of sales engineering, and host of the best podcast out there in technology, Next Level Biz Tech. Make sure that you’re subscribed. And all of these folks will be available at the upcoming Telarus Partner Summit. Do not miss.