Data can help companies leapfrog competition: Teradata President & CEO

'The challenge that faced Teradata was to be seen predominantly as modern and relevant as our customers adopted cloud-based technologies', said McMillan

Steve McMillan, president and CEO of Teradata, took the helm of the company in June 2020, when the pandemic had gripped the world and uncertainty was rife. The company itself was in the midst of a restructuring. In an interview with Shivani Shinde, McMillan talks about the transformation Teradata went through to be more cloud-focused, the importance of data governance and the India market. Edited excerpts

You took over Teradata at a challenging time in the midst of the pandemic last year. How has the journey been so far?

I joined Teradata in June of 2019, and I see myself as a custodian of a company that has been around for 40 years, and founded the Enterprise Data Warehousing business at scale. And clearly, Teradata had established a fantastic leadership position from an on- premises capability.

The challenge that faced Teradata was to be seen predominantly as modern and relevant as our customers adopted cloud-based technologies. So, about two months into my journey with Teradata, I declared a strategy that we would focus and be a cloud-first organisation. Many companies just say those words but we implemented them. We pivoted our research and development organisation —and many of our product engineers work in India— and we said we were going to spend from 30 per cent of our research and development budget in the cloud, to 70 per cent of our budget in the cloud. That was about $210 million a year for the research and development budget.

What that did was unleash the creativity and innovation among the Teradata product engineering teams. And we accelerated the delivery of cloud-based capabilities. We completely repositioned the company. We were already on the Microsoft Azure and AWS platforms, but we accelerated the delivery of being generally available on all platforms by the second half of 2020.

We started delivering a lot of cloud native capabilities that really accelerated our position in the cloud in the back half of 2020. And these changes and focus meant that we closed 2020 with a cloud business of over $100 million. That took the marketplace by surprise. Teradata had a rapidly growing cloud business of over $100 million and we were generating free cash-flow of over $400 million. We also brought in a new leadership team. We put in place a new head of sales, product engineering, chief strategy officer and we recently appointed a new chief financial officer.

One of the most talked about technologies these days is the marrying of Artificial Intelligence/Machine Learning & Deep tech.What has been the adoption of this when you speak to customers?

We are seeing data continuing to explode driven by digital transformation and the trends of 5G, IoT edge computing, and AI/ML. We are different from our competitors because we embed some ML capability and advanced analytics capabilities into the data platforms, so organisations can do AI and ML analysis rapidly and at scale. We also believe that for AI and ML to work effectively, you need to be able to trust the data within their ecosystem.

We always tell customers that the Teradata platform is a trusted source of data and it’s the single source of truth for data; when you trust the data, you trust the recommendations made by AI and MLs.

How significant is India for Teradata?

We’re incredibly proud of our India team, we have thousands of team members here and a lot of them are focused on our product engineering efforts, consulting and services efforts, our core operations and delivering our technology as a service. And the talent that we have in India, and it’s delivered from around the organisation, is absolutely essential and is a core part of our delivery and product engineering strategy. From a customer perspective, we have done a lot of work with financial services and insurance companies, telco retail, public sector companies and  e-commerce organisations. We see significant opportunities to continue our expansion, as the country’s digital transformation continues to accelerate. We see India as a tremendous partner in terms of, you know, enabling us to deliver the best possible technologies in the world to our customers, but also, we see fantastic opportunities out there in the marketplace.

One of the recent surveys from Teradata suggests that data governance is important but when it comes to actual investment businesses are taking time. Why?

That’s a really interesting survey that we’ve executed. There is a real gap between how people are actually deploying dollars and what they think is important. So they think that data governance is important but they're not investing in it. We think this is important. We give customers a practical gate to implementation of data governance, especially in a distributed data environment so that it can drive business value.

While AI is getting adopted, how do popular platforms like Teradata make sure biases are avoided?

You’re absolutely right, it’s essential that you can trust the data that’s being imported or utilised by the AI and ML capabilities of the organisation. What we found is that our data scientists and data engineers have some great approaches to be able to address those potential biases and the data that is coming in, because your output is only as good as your input.

There are a number of different tools that our customers and data scientists  are utilising to ensure that the Teradata platform really tests the AI and ML output and ensures it is eliminating bias. Our approach to that is to ensure that the Teradata data platform can work in an open ecosystem, and natively integrate with these advanced services that are available from the cloud service providers that data engineers like to use to deliver the right outcomes for their organisation. Our strategy there is to open up a platform to enable the ingestion of that data, and the utilisation of that data with the most advanced tools in the world to eliminate bias.

The pandemic made companies rush through the digital acceleration programmes, what are customers saying when it comes to spending budgets for 2022?

In our recent survey, we found that 97 per cent of Indian organisations believe that modernising their cloud architecture and improving data management and analytics are going to be the top areas of investments as they work to accelerate their digital transformation efforts. In the next three years, Indian companies are going to be on a par with other countries  when it comes to increasing their investments in emerging technologies like multi-cloud, hybrid-cloud, IoT, 5G and edge computing and AI/ML, and utilising data analytics to further accelerate the digital transformation is going to be absolutely the key. We believe that organisations that take an open approach to embracing as much data as we possibly can will be the winners in the global marketplace and the future.

We used to say that every company should be a technology company. I think we’ve moved on from that and we can now say that every company, every successful company, should be a data company. Some Indian companies are beginning to recognise the value of data governance, and the data that they have in organisations; there is an opportunity for Indian organisations to leapfrog the marketplace by really embracing a focus on data. Going back to another survey that we executed, 68 per cent of companies said that they have no plans to increase their data governance initiatives at this time. And that’s not just thinking companies. Also 48 per cent of US organisations said that companies have no plans to invest in data governance. So there’s an opportunity for organisations that are willing to invest their habits, strategy and plan to get the most out of their data to leapfrog their competition, their global competition, as the world recovers from the pandemic. I think the critical part for a company now is how agile can you be, as we recover from the pandemic, and as we respond to the new opportunities and the new challenges that are going to come up in 2022 and beyond.