FUT2051BU Sustainability as a Competitive Advantage Imperative! Nicola Acutt Rob Glanzman VMworld 2017 Content: Not for publication or distribution

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1 FUT2051BU Sustainability as a Competitive Advantage Imperative! Nicola Acutt Rob Glanzman

2 Agenda 1 Sustainability as a Competitive Imperative 2 VMware Commitments & Results 3 VMware s Emerging Technology Innovations 2

3 Disclaimer This presentation may contain product features that are currently under development. This overview of new technology represents no commitment from VMware to deliver these features in any generally available product. Features are subject to change, and must not be included in contracts, purchase orders, or sales agreements of any kind. Technical feasibility and market demand will affect final delivery. Pricing and packaging for any new technologies or features discussed or presented have not been determined. 3

4 Sustainability as a Competitive Imperative

5 What is Sustainability in the Context of IT? Sustainable, or "green" IT is a catch-all term used to describe the manufacture, management, use and disposal of information technology in a way that minimizes damage to the environment. The term has many different meanings, depending on whether you are a manufacturer, manager or user of technology. VMworld 2017 Content: Not for publication 5

6 Sustainability as a Competitive Imperative Carbon Disclosure is not mandatory yet. Shareholders now expect companies to disclose how resilient its portfolio and strategy is. CDP data is now fed into Bloomberg terminals Importance of disclosing as it effects the supply chain. Credit Rating or distribution Agencies have cited ESG transparency as rational for changing credit ratings. 6

7 Sustainability as a Competitive Imperative Risk/Insurance industry now heavily weigh sustainability in their assessments Whether you believe or not in climate change, increasingly unpredictable and powerful weather events increase the importance of businesses being able to prove the resilience of their mission-critical infrastructure. VMworld 2017 Content: Not for publication 7

8 The VMware Business Imperative TRANSPARENCY & MANDATES EU Directive Blackrock Letter & World Fed of Exchanges COP 21 Paris Agreement ESG Data in Bloomberg Terminal GRI VMworld 2017 Content: Not for publication 8

9 The VMware Business Imperative TRANSPARENCY & MANDATES EU Directive Blackrock Letter & World Fed of Exchanges COP 21 Paris Agreement ESG Data in Bloomberg Terminal GRI 2 CUSTOMER DEMAND 86% EcoVadis customers are VMware customers 150% Increase of companies reporting to CDP since

10 Actual Examples From Recent Customer RFP's Do you currently have an in-house documented environmental management system which we are able to inspect upon demand? Does VMware have a policy regarding social, environmental and ethical standards expected in their supply change? Has the proposed software code been optimized from the design phase to reduce resource consumption? Which Green IT Code criteria did you follow? VMworld 2017 Content: Not for publication 10

11 The VMware Business Imperative TRANSPARENCY & MANDATES EU Directive Blackrock Letter & World Fed of Exchanges COP 21 Paris Agreement ESG Data in Bloomberg Terminal GRI 2 CUSTOMER DEMAND 86% EcoVadis customers are VMware customers 150% Increase of companies reporting to CDP since MARKET DYNAMICS Carbon Charge for each BU AWS targeted by Greenpeace Integrated Reporting tied to Value Chain 11

12 The VMware Business Imperative TRANSPARENCY & MANDATES EU Directive Blackrock Letter & World Fed of Exchanges COP 21 Paris Agreement ESG Data in Bloomberg Terminal GRI 2 CUSTOMER DEMAND 86% EcoVadis customers are VMware customers 150% Increase of companies reporting to CDP since MARKET DYNAMICS Carbon Charge for each BU AWS targeted by Greenpeace Integrated Reporting tied to Value Chain 4 RESOURCE SCARCITY 12

13 VMware Commitments & Results 13

14 SUSTAINABILITY PILLARS

15 Science-based target for carbon emissions Carbon neutrality across global operations PLANET GOALS Aggressive water conservation 90% waste diversion and zero e-waste to landfills 50% procurement from socially responsible and/or diverse suppliers

16 100% of our internal IT operations are virtualized! 2017 PROGRESS ON GOALS 72% of global operations powered by renewables 100% renewable energy powers Palo Alto and Wenatchee datacenters 94% waste diverted from landfill at Palo Alto HQ Palo Alto HQ

17 VMware saves $2 MILLION in energy costs for our own infrastructure per year! 2017 BUSINESS ROI First offshore deal for Green Power for facilities in India saves >$420K per year! LEED Building investments save >$70K in OpEx expenses per building!

18 VMware s Emerging Technology Innovations VMworld 2017 Content: Not for publication

19 SUSTAINABILITY PILLARS

20 1 2 3 Incorporate sustainability into every product PRODUCT GOALS Empower customers to run cleaner clouds Integrate sustainability into our customer experience

21 Whitepaper Sustainability as a first-class metric for developers and end-users Details A Sustainability Life Cycle Overview of a number of concrete examples that illustrate areas in which VMware has implicitly improved sustainability through technical means throughout its entire product suite and throughout the development cycle. The improvements are the result of establishing a resource goal first and then solving key technical challenges. 21

22 Whitepaper VMware Hands on Labs Over 1 Million Served (12/2016)! Reduced footprint even though the number of labs increased by a factor of 1.5x! Improvement in reducing wasted worldwide real time resources on average is over 21% 22

23 & Power Efficiency Testing 2014: Initial testing conducted on ESX5.5 and Ivy Bridge to determine power vs efficiency and optimal CPU saturation level. 2016: Retested on ESX6.5 with the same H/W and saw a 2-3% increase in efficiency. Impressive considering this was just a S/W upgrade from 5.5 to NUMA Scheduler enhancement to take advantage of Haswell+ Intel p-state granularity VMworld 2017 Content: Not for publication 23

24 & Dell R13 Broadwell PowerEdge R X (50%) performance increase! VMmark score: R930 = 8.01; R940 = Power Efficiency Testing 2.1X (100+%) increase in # of VMs! R930 = 9 tiles; R940 = 19 tiles (note: each tile is 19 VMs, so the R930 cluster ran 171 VMs, the R940 cluster ran 361 VMs) Performance/watt efficiency gain of ~9%! Dell R14 Skylake PowerEdge R940 24

25 CARES: Carbon Aware Resource Energy Scheduler (current research) How many know what DPM is? Great idea! Feature since ESX 4. Hardly ever used! Why? SO, what s the next lowest common denominator for maximum energy savings? Let s try something unnatural. Unbalance a cluster, intentionally! Theoretically possible with Predictive DRS, vrops, and some creative automation! 25

26 Cloud Exchange - Project Preview Overview Benefits Efficient & Below Cost An AirBnb model for Cloud. Auction-style Matching Like Netflix vs. Blockbuster Usage-based Chargeback Distributed Cloud on VMware Stack Secured Network Private Cloud Public Cloud

27 Carbon Avoidance Meter (CAM) - Extending on an internal Carbon Scoring project, we wanted to move from a average scoring to a highly accurate, real-time carbon score based upon VMware Skyline product usage data. This will provide customers with a highly accurate and reliable carbon score, based on emerging worldwide regulations VMworld 2017 Content: Not for Basically, a virtual "Green Advisor" Project Preview publication 27

28 Carbon Avoidance Meter (CAM) - Project Preview 28

29 Carbon Avoidance Meter (CAM) - Project Preview 29

30 VMware s Biggest Impact: YOU - Our Customers! 30

31 VMware s Biggest Impact: YOU - Our Customers! In cumulative terms 340 million tons is the equivalent of having eliminated 900 billion automobile miles being driven over the past 13 years VMworld 2017 Content: Not for publication 31

32 VMware s Biggest Impact: YOU - Our Customers! The CO 2 avoidance in 2016 alone is the equivalent of removing over 15 million cars from the road and the avoidance of having driven over 170 billion miles That's ~$25 Billion Dollars/year in energy savings alone! 32

33 We re not done yet! Let s add additional efficiency gains with VSAN and NSX! 3rd party study on cumulative infrastructure avoidance related savings can quickly go north of 10-20% when firms proportionately complement their vsphere installations with VSAN and NSX!! 33

34 Company Leadership Awards & Recognition CDP: A- Leadership Level EcoVadis: Silver Recognition EPA: Leadership Club #14 on Top 30 9 LEED Certified Buildings PA Best Workplaces for Commuters 2017 National CSR Award 2017: Overall Excellence in Corporate Responsibility All achieved in less than 2 years! VMworld 2017 Content: Not for publication 34

35 Conclusion: Sustainability is Moving From the Edge to Core 1. ESG disclosures, environmental-related regulations are inevitable. 2. Sustainability can have solid business ROI 3. VMware s approach to sustainability because is embedded in the innovation engine of the company - the Office of the CTO 4. Our wish is that you have been inspired by our story and think about what you can do for your own organization to stay ahead. 5. VMware can help your company not just comply but, take advantage of the competitive opportunities. VMware can be a part of capturing the imperative. VMworld 2017 Content: Not for publication 35

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38 Resources VMware Xplorer & xlabs blogs VMware Sustainability VMware Office of the CTO Carbon Disclosure Project 38