With Fresche’s New CEO, There Are No Problems, Just Solutions
August 16, 2023 Timothy Prickett Morgan
Joe Zarrehparvar was just finishing up his first 100 days as president and chief executive officer at Fresche Solutions when the company has begun its transition to a new subscription licensing model and when he finally had enough time in the job to sit down and talk with us about where IBM i customers, and therefore Fresche Solutions, would be going under his stewardship.
Zarrehparvar has a long and varied career in the IT industry, which started with a bachelor’s degree in electrical engineering and electronics from the Manchester College in England and a master’s degree in engineering management from Southern Methodist University. After that, Zarrehparvar was at Texas Health Services as director of IT, and then became general manager of global services at Microsoft from 1994 through 2001. He was a co-founder of Trevoli, an early SaaS software supplier that focused on commercial retailers, in the wake of the Dot-Com Bust, and in 2009 moved to a leader for the engineering team for the Data Center Business Unit at Juniper Networks, which was the big rival of Cisco Systems at the time. Zarrehparvar did some short stints running sales at Avanade and Columbus A/S a decade ago, and then was chief executive officer at Wicresoft International in San Francisco for more than eight years. Wicresoft is a Microsoft partner that provides advisory and operation services to multinationals that has over 10,000 employees.
Zarrehparvar’s experience is both broad and deep, and this is exactly what Fresche Solutions needs as it transforms itself for the modern IBM i market, and he took the time to talk to The Four Hundred precisely about that.
Timothy Prickett Morgan: At this point in the IBM i segment of the IT industry, there are lots of companies who have modernized to different degrees – and now we have yet another kind of application we all need to worry about with this generative AI stuff.
When I wrote my lead story last week, I talked about how it feels like the rate of change in IT is increasing, but it’s not. It’s just that change is happening all the time and it is always a big deal. Every ten years or so, we get knocked off balance. The PC revolution and its consequent client/server revolution in the datacenter, the Unix and open systems revolution, the commercialization of the Internet and the rise of X86 servers and Linux, webscale data analytics and social media applications, and now generative AI.
Joe Zarrehparvar: I have been around long enough to have gone through virtually all those evolutions in the tech industry. I was, for instance, at Microsoft when we were trying to figure out if the Netscape browser was a thing or not.
TPM: I would say that put you on the front lines of the Web . . .
Joe Zarrehparvar: In terms of big data and what analytics means in terms of mobile solutions – how pervasive will that be – this has been a big transition. And of course, the coronavirus pandemic was another pivot point for the industry and how the work environment had to change. What tool sets? What capabilities? What data security? What’s the fabric of pulling teams together? How do you develop new things and what do you use for that?
This is a personal opinion, but I think about what is actually AI versus machine learning as part of AI. So there’s two ways to look at that. I think after speaking to customers, they would benefit from monetizing assets that they have and own, including their transactional data, and their consumer related data. The intelligence around data around hiring practices, nuances of geography and time zones, and even cultural aspects of different parts of the world and within a country are all important. Not using that data in a more profound way than they do now would be losing the race in a hyper-competitive and evolving market, at least at the top of the company.
So is that being done or not? Put aside consumer AI and the hype of large language models, because that’s a whole different conversation. But I think ignoring AI in the larger sense would be devastating to companies. Now, does that mean they should close everything down and retool their factory floor, for instance, for AI? Clearly not.
That’s not what I would suggest. But I want customers to be very aware and to actually start practicing some of those automation tools within their own environment first so that they can address and understand and learn how AI can give a right answer but also how it can be tricked into giving you a wrong answer.
TPM: I think that is wise advice.
Joe Zarrehparvar: The issues they need to think about are many. Such as: How much data do you need in order for AI to give you a substantially and statistically valid foreshadowing of what might happen in the future – just from regressive data and machine learning that all of those things come into play, including how much of that data can you use? In what context can you use that data? And what are the ethical and integrity considerations of said data.
So none of this is simple. But we have to consider AI as revolutionary as mobile devices, social media and even emergence of internet 25 years ago Without a doubt, I think it is.
TPM: There’s no doubt in my mind. Machine learning has been around for ten years now in a workable, usable form, and customers need to figure that out as well as generative AI models and even AI-infused recommendation engines. The need to figure out how to gather and curate datasets, add external data about the economy and the world to their data about their customers, and figure out what meaningful things can they project into the future?
I think that that’s all part of it and the way to do that is to not buy millions to billions of dollars in hardware and model expertise, but to rent it. My prognostications, based on old-fashioned human inference, assume remote service providing at all levels of the stack, and that includes everything in the IBM i market starting with the hardware, the operating system and the database, and the system tools – and in a lot of cases, the application software and the tools to create applications.
So do you think that’s our future?
Joe Zarrehparvar: We have some customers that have billions of dollars in revenues and over a trillion dollars in assets where 40 percent, 50 percent and sometimes 100 percent of their business runs on the IBM i platform.
The question there is: Why? Why haven’t they moved it off to a different platform? Why haven’t they created more portable code that can run across the various platforms and clouds? Well, a lot of that has to do with the business value of a very robust and fortified IBM i platform and ecosystem. They can’t really justify those changes just for the sake of the cosmetics when modernization is a very safe and viable path forward.
So if I can pivot to what’s the plan for Fresche Solutions. As you have put it very elegantly, we are the company with the most extensive capability to help customers modernize and innovate for the future. No other company in our space even comes close to providing the level of service that Fresche does for strategy services, modernization, cloud, new development, managed services and security. And, unlike many others, we have innovated over the years and we will continue to do so. That will undoubtedly include newer tools, more modern ways of taking advantage of emerging technologies, including AI, to help our customers get to where they want to get to with a well designed plan without compromising the robustness of their applications and operational integrity
Now the next question is: Where does our customer want to get to? This is the central tenant of our existence in terms of our plans. Fresche Solutions is not driven by any platform or any self-serving motivations. We have been and are proud to be the trusted strategy advisors to our customer. When customers tell us they want to transform their code, no problem at all. We are not pushing them on or off a platform. A different customer can say they want to make their code portable so that if they want to at some point move it, they can. All of our solutions are designed to be flexible and geared towards what the customer wants.
Then you get into security. How do you want to secure it? If the customer says they want applications on premises but they want to put their dev/test in the cloud, no problem. We can make that work exactly as they prescribe versus saying we want to take it all off their hands. We do have our own cloud, so we can move them there, or if the customer says they want to go to IBM or a public cloud, we will give them the ramp and roadmap to get to the cloud environment of their choice. If the customer says they want to keep their systems on premises, but they want to turn over the operational and administrative keys to running and managing it over to us, we can do that too.
TPM: I think the future of IBM i systems in particular and for all datacenter systems in general is definitely subscription-based and, for a lot of customers, there will also be remote services of some fashion. It could be a programming service and they keep their administration. It could be administration service and they keep their programming. It could be third party software and they just run it all either on premises with managed support or they run it all in the cloud with their own support. There are many variations in the possibility matrix here. I don’t envision people holding as tightly to everything as they used to.
The important thing is they want a monthly bill as OpEx, not an upgrade cycle with a lot of CapEx.
Joe Zarrehparvar: That’s the bridge to what we announced a few weeks ago with subscription pricing on Presto.
TPM: Which I am going to cover in detail separately.
Joe Zarrehparvar: Here is the thing. When we have a customer, they could just buy a piece of software from us or they could be a multimillion dollar modernization customer. It doesn’t make any difference if what they get from us is in a subscription model under the old label perpetual licenses plus maintenance. For us, maintenance is always unlimited support. So that’s unique to us. That’s not something that big software companies have anymore. That is like a data plan on your cell phone, but it’s unlimited.
TPM: I still have one of those. It’s wonderful.
Joe Zarrehparvar: So do I. You’re not really worried about where you are or how much data you use. What we want our customers to understand is that when they subscribe to a service from us, what they get with it is our expertise that comes straight from the horse’s mouth, if you will. They get our developers for a bug fix or a new feature request, or for a strategy conversation, or for advice on a certain part of their business. And in some cases, customers going through modernization efforts that are already resource constrained might need some of our people to keep the lights on so their team can be part of the new transformation and modernization project.
So for us to have this relationship with our customers that says first of all, we have the widest spectrum of services you can get. That includes anything from hosting to rewriting your app to reprovisioning your line of business to securing your data to the analytics of that data. All of those and all the advice you need going forward, all of that can be part of one relationship. And that removes all these other barriers of having to go back to the boardroom for budgets and instead, it is a predictable and reliable planned consumption of services/solutions made to meet their business objectives.
We are making some significant changes. One is shifting to the subscription model on everything we do, whether it’s a monthly consumption of our cloud services to licenses on our products. So we’re removing the entry barrier. Customers can pick up the product on their own, have a trial, get a key with a five or ten minute install – They’re up and running. We will take care of them during that period and at some point they’ll make a decision. We’re not going be knocking on their door every minute with an easy on and easy off model. If they decide to stay, great. They start paying a fee that’s monthly and it’s predictable, it’s part of their budget. But if 90 days later they decided they don’t want to, they don’t have to. We are doing away with the old school way of having a call or difficult licensing terms and notice or doing things that were not very centric to the customer experience they expect to have.
We’re removing all of those barriers, modernizing the way we interact with our customers across the big broad spectrum of services to achieve superior and exceptional customer experience
We provide fractional services, too. A company might need some people to watch systems or applications, or maybe they have lost people to retirement. We can plug the personnel hole for them.
TPM: I think it’s wise to sell it that way. You can pitch having a lot of expertise and come in to deal with the mundane stuff and they can build the expertise on the modernization alongside you and that’s going to build trust right there because they’re going to realize you’re not just in it to try to make them addicted to you. That’s a real partnership, and it’s a very big distinction, I think.
Joe Zarrehparvar: We want to be the ones they call for tools and services as well as strategic and tactical advice. How do they know that their hardware and their software is performing at an optimal levels? Why should they just keep adding horsepower? There are so many questions about security. Who is doing the audit because most companies aren’t doing it. Should they be auditing once a year, or once every six months? What about development disciplines or standardization modeled for growth and expansion?
That’s ultimately what Fresche is headed towards being – and providing this while measuring the experience of our customer, not their satisfaction. Our customers are asking for modernization help, tools, advice and a roadmap. How can a company that provides that not modernize itself?
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