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May 20, 2024: In today's episode of Keynote, PV SubbaRao, SVP at Rackspace Technology, explores the dynamic shifts in IT outsourcing and cloud security. They delve into the evolution of cloud services, discussing how the interplay of automation, AI, and multi-cloud strategies can optimize healthcare operations. What does doing "more with less" truly mean in the context of current IT frameworks? How can healthcare leaders navigate the delicate balance between best-of-breed approaches and the potential pitfalls of vendor lock-in? As they reflect on past experiences, particularly the transition from Perot Systems to Dell Services, the conversation also probes the implications of hybrid cloud strategies and private equity influences in tech partnerships. These insights prompt us to consider whether modern IT architectures can support the increasingly complex landscape of healthcare needs without compromising on security or efficiency.

Key Points:

  • IT Outsourcing Evolution
  • Cloud Security Challenges
  • Vendor Lock-in Risks
  • Multi-Cloud Management
  • AI and Automation Impact

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This transcription is provided by artificial intelligence. We believe in technology but understand that even the smartest robots can sometimes get speech recognition wrong.

   Today on Newsday.

don't expect that you know everything, but maintain that curiosity, because end of the day we're in an ecosystem where things are changing constantly.

You should be able to embrace the changes with an ability to learn.   My name is Bill Russell. I'm a former CIO for a 16 hospital system and creator of This Week Health. where we are dedicated to transforming healthcare, one connection at a time. Newstay discusses the breaking news in healthcare with industry experts and we want to give a big thanks to our Newstay partners,

Clearsense, Sure Test, Tausight, Order, Healthlink Advisors, Cedars Sinai, Rackspace, Crowdstrike, and Fortified Health .

Now, let's jump right in.

(Main)  All right, it's Newsday, and today we are joined by PV. Subbarao, the SVP, Global Healthcare and Life Sciences at Rackspace Technology.

First time on the show. PV, welcome to the show. Thank you, Bill. Glad to be here with you. and I have a history, so this isn't the first time we've met. We go back to your days at Dell. you there during the Perot days or were you just

right around Perot systems being bought by Dell and the transition.

And then pretty much we became Dell services and we had a ride together and an exciting ride. And super glad that I have got the privilege to work with you over the years in the past.

Oh man, that was something else. So you were assigned to the St. Joe's account. We had just insourced from Perot We had insourced it. What was that going to mean for Dell and the services? And we ended up doing an awful lot of services with you guys. And it was really broad too. We did things around imaging. We did things around desktop deployments. We, it was really broad. You guys brought A lot of services to bear, but now you're with Rackspace. Tell me a little bit about Rackspace and what Rackspace is doing in the healthcare space.

That's right, Bill. We've done pretty interesting things, broad based services. And again, the philosophy of what you brought in was, what can I do more with less?

And that's pretty much, really drove in terms of the partnership. But coming to the, Rackspace ecosystem, we've been delivering value to our customers for about 25 years. We've been in the industry since 1998. We started with web hosting when there was no hosting ecosystem. And we took that to hosting private cloud on VMware.

And we founded OpenStack public cloud with NASA in 2010. Today we are a hybrid multi cloud and AI solutions firm serving about 20, 000 customers across 120 countries and supported by 5, 800 Rackers. Our employees are being called as Rackers. And we represent about 9, 500 certifications across various cloud stack.

So you said something that's of interest to me, and I think to a lot of health IT leaders, which is doing more with less. So if I have my own on prem data center or I am potentially already in the cloud, maybe I'm with one of the big, you guys are a big player too, but one of the large public cloud companies.

Rackspace save the health IT leader money?

Yeah, it's very interesting, Bill. And if you look at our differentiation, we are large enough to deliver, small enough to care. We use that with pride. And we have a lot of flexibility and agility with which we drive innovation that unlocks more value to customer.

And the unique characteristic is that we use labor minus approach. And that is through automation and AI that sort of creates that new forms of value. And our unique IP in our service delivery approach, delivers desired outcomes. And when we look at a holistic perspective about cost and productivity optimization lens, with which we see where you are today and what struggles that you are looking at and what cloud means from an operating model and how do we bring that to life with various health systems.

Yeah, that

lot of sense. Well, we're going to get into the news and we're going to start with a CIO. com article and it's CEOs Top priorities for IT leaders today. This was written on May 13th and so they do their state of the CIO study. And this is their 2024 state of the CIO study.

I'm going to give you a couple of these and then love for you to comment on what you're seeing in the marketplace. What are the top priorities? Here's some of the ones that they gave. The top one being lead digital business. digital transformation initiatives. That's number one. Upgrade IT and data security to reduce corporate risk is number two.

Man, that's probably the first time I've seen that high. Number three strengthen IT and business collaboration. Number four, research and implement AI enabled products. Those and I'll give you number five. Number five, improve the customer experience. So those are the top five. CEO priorities for IT in 2024, and it looks like they really haven't changed much since 2023, except for the AI one.

The AI one is new this year. It went from nothing to Research and Implement AI enabled products went to number four over the course of a year. do those priorities resonate with you? Is that what you're hearing or are you hearing some others?

definitely those priorities are in line.

And we see one more thing, Bill, which is shortage of talent. and that's across not just in IT, but overall at the enterprise level when you look at various categories of where you really need resources. And the skill resources are extremely high in demand. And if you talk to any of the healthcare organizations, they're also compounded by this particular problem.

And which means with all of the changes that we are seeing in the marketplace, a lot of consolidation, a lot of, changes in terms of how to catch up with the technology. Transformation demands that are evolving in the marketplace and security posture that you need to improve and drive more adherence to compliance as well as the regulatory aspects of it.

And in doing all of that with little, talent that you have and that you are struggling in terms of you really can make use of with the talent. So you have to look for revenues in terms of partners and ecosystem players. So one can't solve by themselves. You have to really look at a broad based approach of partnership.

And also with the perspective of how you can, think about folks that are coming out with innovative approaches to solving problems. And that's really fueling the momentum. End of the day, we can coin any of the terms. Let's say digital transformation, or what about, what we call it as a new age of technologies that are coming in the marketplace.

So are looking at is how do I create new forms of value by leveraging technology, right? And these technology trends are coming out with a lot of approaches in how they can address to specific use cases and really helping in terms of being part of that ecosystem to solve the problems.

It's interesting because our history speaks to this a little bit.

So we were at St. Joe's, 10 year per row outsource was insourced. Is that model gone? That big, hey, here's my IT department, you can have it all, and it's more, it's a different model today?

Yes the old school outsourcing, right? So that's, I think, the one that we've actually traveled.

That has changed and that is changing by the day, Bill. And those Deal structures are a lot different these days. It's more about specific areas of what you are able to bring value and in a manner that really conforms to what immediate outcomes and also an operating model that conforms to you.

How you can be part and parcel of driving value. And we don't see the old school outsourcing, in terms of the way to really create value, those deals are diminishing and what you really see is pointed areas where you can influence outcomes. And for example, when you look at it instead of 10 year outsourcing, when you look at.

Hey, I'm looking at my EMR and how can you really drive EMR as a service specific to what you can bring confirmed with SLAs, confirmed with outcomes and all the characteristics that you look at it. And with that kind of an outline, we have taken a point solution approach. The point solution is.

Hey, here are your immediate, needs. Here are the problem areas that you're looking for. And this is what we can actually bring to the table and then use that partnership to really expand for how you can drive incremental value. Once you are able to really create a value ecosystem for, really driving what they're looking for.

Example we've started with this journey with the health systems, everybody has various EMRs. So we took EPIC based customers and then we said like we can actually use our horizontal services and then sort of bring the vertical, enabled services on top of it to drive. So our EPIC infrastructure managed services is a differentiated play today, and it sort of actually conforms to the way you can consume that service.

and be able to register incremental value in terms of speed, availability, as well as the performance that end users are looking for. And that way you are confirming to internal experience, end user experience, and that sort of translates to what you are offering to the communities.

It's interesting.

I guess I want to go in a couple different directions here. We might spend the whole time on this topic. So it's sort of a best of breed. Gartner used to call it selective outsourcing, right? So it's finding the best partner for the best solution. I might call it best of breed, only to form the question.

So best of breed, outsourcing. Whenever we do best of breed anything, it sounds good because you're like, yes, we're going to get the best partner for this, specific thing. But then you could potentially split up your workloads across data centers that are, you could have latency between them. You could have data sharing challenges.

Best of Breed creates potentially silos, architecture issues, latency, and then maybe the whole isn't as good. which is why people think that the wholesale outsourcing is going to work. Now we know from experience it doesn't. I just want to be real clear before people send me emails. We know very well from experience that giving everything to one player rarely works out well.

But how do we make sure that best of breed works? Is the technology that much different now that we can ensure that the latency isn't there or the interoperability between. say a Rackspace data center and an AWS data center. can we architect that in?

Very well said, Bill.

The architect, right? So it's essentially the foundational architecture in which you wanted to run the organization has to be rock solid in the way of how you look at it. you make the architecture as a evolving principles in terms of what you are looking at, where the way you look at it is.

The best of breed solutions can get plugged in with an underlying structure of not compromising the posture in which you want to deliver end services. And you have to have that architecture in a manner that is agile, flexible, and really be efficient in the way of how you cater to the business. And the breast of breed players, when they bring their solutions, they should fit in terms of Your underlying, strategy and underlying architecture.

And we see that to be much more effective and almost organizations. This is what your strategy used to be when we were working, where you are laying down the foundational architecture and guiding principles. Those drive the way you work with various ecosystem players. And that sort of enables you in terms of, hey, do I have a rock solid approach of what cloud means?

We all know cloud is not just one thing in terms of hey, I work with XYZ players it is a combination of a private cloud, public cloud and edge, right? So you will get to see a different facets of it You should be in a position to have an operating model that actually plugs into that kind of an ecosystem.

And latency is not a concern these days with the type of networking technologies that we have in the marketplace. And from a ability of data, you just have to look at the architecture of how your data flows are, and how you are actually putting your interoperability strategy for really enabling that exchange.

And with an intent to drive your experience, overall end user experience that is not compromised in whatever shape or form. And it's all about the applications that comes down to, can the applications run within this particular architecture that I'm defining.

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  📍 📍 📍 As I'm thinking about, one of the things I've been saying since 2008, PV, 2008, I said one of the biggest challenges with Cloud was vendor locket, right?

So you go and you put all your stuff out there and then all of a sudden you realize, Oh my gosh, they can raise their price. That's one thing. The other is potentially security. And I'm going to come back to security because we just saw change healthcare. And now we're in the midst of an Ascension challenge that's going on and whatnot.

the things we love about cloud are what make it vulnerable. But I don't want to talk about security just yet. I want to talk about vendor lock in because we have stories of partners, specifically, I'll give you one example, like Citrix. Citrix gets bought by a private equity company.

Private equity company says, I know how to make money. We're going to raise everybody's rates and we're going to double it and then everyone's sitting there going, well, what, I can't switch tomorrow. I've got to pay these rates. So vendor lock in creates a business risk for people. That's one of the things I like about Best of Breed, because if you have your own private cloud and you're doing a hybrid cloud into Rackspace and a hybrid cloud into, AWS and potentially Azure as well.

first of all, you can create some redundancy and some disaster recovery, but you can also switch if somebody gets a little too heady and says, we're going to double your rate, you say, well, that's fine, I'm just going to move over to Rackspace.

Absolutely, Bill. So we see both ways, right?

So in terms of the adoption of cloud as such is, it's all about cost of operations. Where am I today? I might have taken a journey into cloud without knowing the implications of what my, cost structure is going to

look like. Say nobody's

done that.

Come on. Moved a billion dollar organization into the cloud without understanding the rescue.

I'm sorry. I just had to have fun with that.

Yeah that's taking a lot more. I think the technology organizations have become, especially from a buyer perspective, they've become more mature than, when we started, let's say about, two years ago. 10 15 years ago built together in terms of what we've seen, where the market is, and where the industry is going, where the puck is really heading towards.

And that particular journey was like, hey, I've got more of what I'm doing, I have to actually make best use of it. But today most of the organizations are not about, hey, lift and shift, right? So I'm really doing the transformation journey with what cloud is, offering for me, and then how do I use it?

Microsoft Mechanics And if the cost structures are changing, and I've got my strategies to, either repatriate or move to something else. And that's really fueling most of the thinking for how CIOs are and CTOs are really, looking into. The second thing is that they are posed with some of these recent things that you mentioned about, private equity players or some other organizations gobbling some of these massive technology players in the software space and also The unique skill or unique technologies that are really driving end user experience, right?

So we talked about Citrix, VMware is also going through the same thing with Broadcom. So and confirms to in a little bit of challenge that they say, I got a sticker shock of what I'm going through. I need to really look at what my options are, what my choices are. The industry is actually going through, so much of it right now.

But where we are looking at in terms of the relative advantage of what we are doing at scale. Which is extremely important at scale. So we are the largest private cloud operator and we are differentiated player with public cloud services. So we can relatively look at costs and performance characteristics of what is really driving any strategy for customers.

So it is important for making the right workload aware infrastructure choices upfront so that your journey becomes much more effective. And that particular thing that I said about workload aware infrastructure choices, it's important. And that probably has seen a lot more maturity over the years than, probably, 10, 12 years ago.

Yeah. Let's talk about security a little bit. This tends to be a growing concern at the board level. Not just the executive level. This goes all the way up. And we saw the change healthcare. And one of the things was talking to CISO this week, in fact, and we were talking about the Change Healthcare Breach, and he said, hey, were SOC 2 certified, they're HITRUST certified, they had all the certifications, and still, they were taken down essentially impacted all of healthcare.

When someone moves to the cloud, what's the conversation? Is the conversation, hey, You have this part of security and we have this part of security or? does the conversation go with that?

It's about the clarity of what controls are you managing up to and in a vendor and in a buyer organization or a partnership organization.

And even as a do it yourself type of an organization. So you have to look at, recent ones that we've seen with change or with essential health. And some of the ones that we've seen, Bill, it's about. The operating model of are you actually feeling good about standards at the macro level?

Are you actually looking at the workloads in terms of what my security vulnerabilities are? Which means what's your change management strategy? What is your patching strategy? How diligent are you in confirming to Strategy of what you're looking at. Are you following n 1? Are you at the current level?

So where it needs to be? Are you n 2? So that is important at the granular level. So most of these organizations Especially when you really look at it, the ecosystem of applications, hundreds and thousands of them that we are running, some of them are legacy, some of them are like old school technologies that you might not have really, patched them for years.

And the vulnerability landscape must be like absolutely the door opener for some of these. into, bigger issues. And they have to look at it. And if you recall, we even went ahead. Hey, while my perimeter is all good in the health system, while my application ecosystem is, looking good in the overall spirit of it.

But what about my device security in a health system, situation? So are there network devices that are old, that I'm not really controlling, How will that entry, really create a vulnerability for me? Aspects like that, attention to details about overall posture of where you need to be, what is your current state, what are the gaps, and what level you should operate.

That level of clarity is important for some of these organizations, and the bigger organizations have a lot more because of the sheer nature of the ecosystem that they operate in.

This is going to be my last question, and We're going to exit on what makes an effective salesperson.

So you're hiring salespeople right now. You were an incredibly effective salesperson for me. As you can imagine, I was. As I tell people, I was a fairly arrogant individual when I was CIO at St. Joe's, and there was a lot of sales people, I was like, just get out of my office. You have nothing to there's no conversation that you're going to be able to have with me, and you were in my office a fair amount.

We whiteboarded together, talked through things, but now you're hiring sales people, and sales and healthcare is a very distinct Animal. And I'm looking at these CEO priorities for IT. And this was happening to me when I was at St. Joe's, which was more and more of my priorities were at the business level.

And so because we were large enough, we were six and a half, 7 billion. I was more and more saying to people, Hey, you know what? Meet with my VP of infrastructure, like the Cisco rep. I remember saying to the Cisco rep, don't want to talk to you anymore. Meet with him. He will talk to me. And if the architecture makes sense, I'll just approve it.

And these business priorities are interesting because you started this conversation with a business priority. You're like, Hey, we're helping organizations to reduce their spend. They're struggling. And that's one of the things in here. Reduce and rationalize IT spending is one of the top priorities for CEOs.

What are you looking for in a sales person for healthcare and how do you help them to be successful?

Very loaded question, Bill, but I think I'll take one thing that really stuck with me and I really use it every day. I'll tell three things and the first one is what you what you used to mention.

Storytelling. You have to be an effective storyteller for what you are bringing to the table in the right sense, right? Which means you have to be fully aware of the business and the technology, related elements for you to show value. And the second thing is Passion. So you have to have passion when you are really looking in the sales, which means that your courage and commitment with passion should drive what is important to create value.

So keep the customer front and center with a value creation focus. And the third thing is, in terms of how an individual can look at it, curiosity to learn. don't expect that you know everything, but maintain that curiosity, because end of the day we're in an ecosystem where things are changing constantly.

You should be able to embrace the changes with an ability to learn.

Yep, absolutely. PV, I am so glad that Rackspace is a sponsor and that we are going to get the opportunity to have more of these conversations. I know we only covered one news story, maybe in the future we'll cover more than one. I think that was a very relevant one for our IT leadership.

How do we view IT outsourcing, partnerships, security in the cloud? We covered a lot of stuff there, so I really appreciate

it. Thank you, Bill. You've been an instrumental part of our journey, and I'm actually super excited to be taking the journey forward. You're doing amazing work the field of how you are creating value for healthcare ecosystem to take it from and privileged to be working with you and looking forward to our next conversation.

I appreciate it. Take care.   📍 📍 📍 Thanks for listening to Newstay. There's a lot happening in our industry and while Newstay covers interesting stuff, another way to stay informed is by subscribing to our daily insights email, which delivers Expertly curated health IT news straight to your inbox. Sign up at thisweekealth. com slash news.

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Clearsense, Sure Test, Tausight, Order, Healthlink Advisors, Cedars Sinai, Rackspace, Crowdstrike, and Fortified Health

you can learn more about these great partners at thisweekealth. com slash partners. Thanks for listening. That's all for now


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