Logicalis CEO Bob Bailkoski On Going 'Deeper' With Microsoft Around Azure

A few months into his tenure as CEO, Bailkoski spoke with CRN about how the global solution provider has achieved Azure Expert MSP certification and is seeking a major expansion of its Microsoft business.

As a result of the COVID-19 pandemic, Bob Bailkoski's first three months as CEO of global solution provider Logicalis Group have been nothing like what he expected.

But there have been big wins for the solution provider, too, including the achievement of Microsoft's prestigious Azure Expert Managed Services Provider certification in March.

Bailkoski took over as CEO of the U.K.-based Logicalis Group--whose U.S. division ranks No. 53 on CRN's Solution Provider 500--on March 1. He previously held roles as CFO and COO at the company since joining in 2015.

[Related: Microsoft CEO Nadella: Remote Work Driving ‘Orders Of Magnitude’ Increase In Teams, WVD]

Expanding the solution provider's Microsoft business--including around the Azure cloud platform and Windows Virtual Desktop solution--are among the key priorities Logicalis has been pursuing even amid the disruptions of the coronavirus crisis, Bailkoski told CRN in a recent interview.

"We expect our Azure business with Microsoft to more than quadruple over the next year-and-a-half," he said. "Based on where we are today, we see strong, strong growth. Their Azure platform is growing at rates of 60 percent or more, year-over-year. And so we've tapped into that."

While Logicalis works with "a whole variety of vendors" worldwide, "none of them are really experiencing growth rates like that," Bailkoski said.

What follows is an edited portion of CRN's interview with Bailkoski.

With COVID-19 becoming so dominant, how have your priorities shifted since you began as Logicalis Group CEO?

I only became the chief exec of the group on the first of March, 2020. I wasn't expecting my first 75 days to turn out the way that they actually have. Before taking on the role, I was getting very excited about rolling out a bunch of new strategic initiatives--mainly around scaling innovative solutions and services that exist in one part of the group, and scaling across the whole of the group. And that was going to be the key focus of my tenure as CEO. And it still will be the key focus of my tenure as CEO. But in this first initial period, obviously I've been a bit distracted dealing with the crisis that is the coronavirus. So I was planning to attend a variety of global sales kickoffs to infuse the teams with my vision, and to listen to the employees about how they felt that we could improve the way the group operates. But literally, within the first two weeks, we were in a global lockdown. And not only did that mean I couldn't travel anywhere, it meant that my priorities had to be reordered a little bit.

So I was initially focused on some key activities, like, for example, making sure that we could effectively work from remote locations. As a technology business, you'd expect us to be able to handle that transformation seamlessly. And to a certain extent we did. But one aspect of that transformation, which I wasn't really anticipating, was the need to make sure that employees' engagement and well-being were at the forefront of everything that we did. So our communication strategy has been adapted massively to make sure that we can understand how the workforce are feeling at any given time. We've got 6,500 colleagues around the world, so it's difficult to keep a pulse on what they're thinking. But in the last few weeks, we've rolled out a new employee engagement tool that gives each employee around the group five or 10 questions every other week to answer. And that gives us a real heartbeat of what's happening in the business, how they're feeling about the response we've had to COVID-19, the level of communication, what things we could do differently, in amongst a variety of other engagement questions.

Of course, when you're working at home for a long period of time--and everybody has to become a chef, a child minder, a teacher in some instances, as well as keeping their professional levels as high as they can be--that's a whole different world of stress for our colleagues around the world. So we've had to focus on mental well-being too, with tips on how to deal with stress--make sure you take regular breaks, don't do everything via video call. Just because you're out of the office doesn't mean you have to engage with everyone in the video, all day long, because that can be exhausting. So telephone, text message, WhatsApp, email, are all still valid forms of communication. So don't forget to use those different ways of speaking or communicating with your teams, and don't always default to video.

I think we've done those activities relatively successfully around the world. Of course now we're absolutely focused on what the impact of COVID-19 will be on our performance. And so we've been trying to work out what it means for us as an organization, in terms of our overall financial and customer activity performance. But the trouble is, visibility is very hard. We live in a hugely volatile world at the moment. A month or two back, the IMF put forward projections for global growth in 2020, and they reckoned it would be around 3 percent positive. But [since then] they changed their minds and said that it'd be 3 percent negative this year. And that's in the space of a matter of months. The U.S. has over 36 million people unemployed at the moment, which is unheard of from where you were a couple of months back. The U.K. just released data that its quarter-one GDP declined is terrible--in March alone it was a 6-percent decline. So, some really volatile environments. At the same time, making sure that you deliver on customer requirements has been what I've been focused on for the more near-term.

Could you give some examples of elements of your business that you’re looking to scale to other parts of the company?

A real-life example at the moment relates to Microsoft. We were recently awarded the Azure Expert MSP global certification by Microsoft. And that validates a particular solution that we had in one part of the world--in our Australian business--which we called the Production-Ready Cloud Platform. And what that solution does is it takes a client through the various stages, taking their on-premise workloads, through to the Azure cloud, in a matter of weeks--not in months or years. It's a very quick process. It takes them from the initial assessment phase--and the consultations to understand the business outcomes and all those requirements--through to the workload migration. But it also takes them forward to the overall managed service that we can offer, because their environment all of a sudden got more complex than perhaps it used to be with a public cloud component, in addition to a private cloud or local data center on-premise environment too. And so that solution existed in Australia, and the Expert MSP certification gave us the confidence to start to roll that out globally. And we started to roll that out just before I became the chief executive in February this year. And that's generated about 30 leads globally, all around the world. About half of those leads have turned into the initial phase of assessment, and we expect those to progress through, hopefully, toward the final managed service piece.

That is a real bit of differentiation that provides our clients with that speed to value, getting their assets onto the cloud in a quick space of time. And illustrations like that exist all around the group. It's part of my broader approach to make sure I can identify those solutions that exist today that are innovative and differentiated, and can be relevant in other territories--but also have the possibility to be adapted a little bit to be relevant to particular verticals, or to particular requirements of a local market so there's a broad consistency in terms of the solution. But maybe there's an element of local adaptability that makes it more appealing to local markets. So the Production-Ready Cloud Platform is a very clear example of early success that we've had in this concept. And I hope to deliver many more of those types of solutions and services throughout my tenure as chief exec.

For the Production-Ready Cloud offering, that's available in North America now as well?

It is. It just recently launched in North America. Last month we started a big promotional campaign on that, using all of the available platforms that you can imagine, Twitter, LinkedIn, for example, but also contacting our clients directly, talking about what it can do for them overall. I think it resonates in particular, in these current times, as many organizations have been caught a little bit short with the remote working environment and the lockdowns that have happened globally. And they didn't have the capability to adapt their offering to the marketplace in an agile way that enabled them to continue to work through this lockdown period. And so the cloud is one component of a service that could have enabled them to react in a better way, perhaps, during this lockdown.

It's likely that the lockdowns will become a feature of life for the foreseeable future--we'll restart, then lock down, restart, lock down. So organizations need to be able to adapt to that inevitability going forward, and public cloud is going to be part of that story.

Has your managed services offering seen more demand in this environment?

Managed services in particular is a tricky one to sell in this period, because there's often a long lead time--with the assessment of the requirements and the tweaks that are required to the services that we offer, to deliver something that is relevant to a particular client or customer in the world. But the one component of our managed service offering that does resonate at the moment is that we've got a backbone support global managed service offering around the world--we call it our digital services platform. And it means that the managed services that we offer internationally are very consistent. So if you're a multinational organization or global enterprise, you can come to Logicalis and we can provide you and guarantee that we can give you a seamless, consistent service anywhere in the world. And when people are looking to optimize their operations, those sorts of stories resonate. I'm not going to lie to you, we've not taken loads of bookings in that area right now, but the number of conversations around that offering has definitely increased.

What prompted you to make the investment to pursue the rigorous Azure Expert MSP certification?

There are a number of areas where our approach naturally overlaps, or appeals, to an organization like Microsoft. For a start, we're a global business, and that aspect is appealing to Microsoft. We've got more than 10,000 customers around the world. And many of them have an on-premise data center, or even a hosted data center approach that's not in the cloud. That's appealing to Microsoft as a potential area of opportunity. But like that story that I mentioned a moment ago, around delivering consistent services in more than one territory--that digital services platform I mentioned earlier is something that resonates quite nicely with the Microsoft approach. And when we talk to our customers, our strategic go-to-market conversations revolve around three areas: How can we help you as our customer engage better with your customers? How can we help you engage your employees better? And how can we help you optimize your IT and business operations better? And if you think about those three components of what we do as a group, in the context of a wider digital transformation, Microsoft has a variety of solutions that really appeal to customers in those areas.

If you think about connecting better with your customers, there's going to be a public cloud component to the "next normal," as we've started to call it within Logicalis Group. In the event of the next lockdown, businesses need to be agile. They need to be flexible. And therefore there has got to be a public cloud component. And maybe you need to connect better with your customer base to continue to offer them services, regardless of what the external environment is suggesting. When you think about optimizing your IT operations, offering a public cloud solution is a key component, because it helps you become more efficient--particularly when you think about the switch between capital expenditure and operating expenditure. And of course we offer managed services that can help our clients control that expenditure as well. And the,n from the perspective of engaging your workforce, clearly Microsoft's modern workplace suite of solutions resonates really strongly with our customer base. So there's a clear overlap between our strategic play with our customer and the whole suite of Microsoft solutions and services.

When we think about dealing with vendors within the Logicalis Group, we consider their solutions to be a platform upon which we build innovation--differentiated solutions and services that we can offer to our clients around the world.

And then, obviously, there's the capability component. We've got several hundred engineers around the group all certified with Microsoft capability. And we've got the Expert MSP certification, and we're currently rolling out global training programs to educate all 6,500 on the suite of solutions being offered today. So for those reasons, we felt a deeper relationship with Microsoft was important.

What sort of growth are you expecting with Microsoft as a result of the investments that you've made?

We expect our Azure business with Microsoft to more than quadruple over the next year-and-a-half. And that's based on us pushing forward, from a global perspective, these consistent solutions and services everywhere. And the roadmap to achieving that sounds difficult to achieve, but the roadmap is very clear. And, actually, our behind-the-scenes calculations suggest we'll be able to grow at a higher rate than that. Based on where we are today, we see strong, strong growth. Their Azure platform is growing at rates of 60 percent or more, year-over-year. And so we've tapped into that. We deal with a whole variety of vendors around the world--from Cisco to NetApp to VMware to IBM to Dell EMC, and so on. But none of them are really experiencing growth rates like that. And it's a story that we really want to share and be part of--while at the same time acknowledging our obligations and our relationships with our amazing other vendors, too. We want to add Microsoft to the mix [more], because of that growth potential, which is extremely high.

Have you been involved with providing the Windows Virtual Desktop solution to customers as well?

Absolutely. In this lockdown period we've seen a spike in a number of areas. One of them is Windows Virtual Desktop. Obviously collaboration tools have spiked up. But more importantly perhaps is that for the security solutions that we offer, we've seen a real spike in demand and a real increase in the conversations that we have with our customers about how they can secure their remote working environments. I think you can consider this lockdown period as like a beta testing effort when it comes to lockdowns. The next lockdown, or the next remote working requirement, will have to be better organized in a more coordinated fashion. Security will absolutely come more to the front there. But on the Windows Virtual Desktop piece, that's [planned for] the global rollout that I mentioned earlier. Because while it's in demand, we think we can configure solutions that are relevant for verticals around the world. And we've got capability everywhere to deliver that. So again, that's part of the roadmap for delivering that growth that I mentioned earlier.

In pockets around the world, we've got a quite strong presence in [WVD]. It's not everywhere. Rolling that out everywhere is part of the plan. And also, rolling that out with a differentiated aspect is more of the plan--so we can appeal to particular verticals and customers with a differentiated offer, which is beyond the basic Windows Virtual Desktop piece.