The next advancement was towards virtualizing the three fundamental data center building blocks of server, storage, and networking to form Software Defined Data Centers (SDDCs). SDDCs resemble traditional data centers in terms of physical hardware but are characterized by a high degree of virtualization, abstraction, resource pooling, and automation. SDDCs eliminated the IT operational siloes and complexities by enabling a programmatic approach through virtualization.

HCI built on SDDC capabilities emerged as a foundation for running hybrid cloud IT operations. It uses software to assimilate core storage and compute functionality into a single highly virtualized solution. IT departments use HCI to lower total cost of ownership (TCO), increase performance and scalability of IT services, and improve overall productivity. Some HCI solutions can also seamlessly connect to cloud environments and leverage fully managed infrastructure and platform services. Designed with full-stack life cycle management, a fully productized HCI system can deliver efficient operations, flexible consumption models, and high-level enterprise capabilities.