Cisco to take partners to next level with TIP

SAN FRANCISCO, USA: Write the rules. Own the game. That was the theme of the Cisco Partner Summit 2010 in San Francisco, which incidentally is also Cisco’s hometown.

With over 1500 of the company’s global partners in attendance at this 4-day summit (April 26-29, 2010) and many times more joining the Summit virtually, the mood was certainly upbeat when the company communicated its roadmap for FY 2011.

“Competition is good. It makes us better,” said Keith Goodwin, senior VP of Worldwide Partner Organization in his opening address. He was making a light-hearted reference to IT major HP. Both the companies scheduled their partner conference on the same dates, forcing partners to choose one in a show of loyalty. In what possibly is a sign of aggressive market positioning the company reiterated its commitment to Cisco partners exhorting them to take the flight to success with them.

Bold moves are required to come out of the hit delivered by global recession and to capture growth. And in terms of strategy it was all there: Right from technology forecast to partner rebates. Cisco is betting on “the network as the platform”. Goodwin in his opening address outlined the market transitions that the industry is going through and how one can ride on these transitions.

Borderless Networks–Collaboration, Virtualization, Video and Cloud-based services are transforming the information technology. The company announced a series of initiatives that will help channel partners evolve their business models to align with these transitions.

Essentially, the company emphasized its partner-centric philosophy and focus on encouraging early partner engagement and Cisco specializations built around the network platform and its complex delivery models.

To create its market differentiator Cisco will focus on identifying 500 transformation accounts along with its partners. These will be the early-adopters, businesses with complex requirements fulfilled by building solutions on top of network platform. To move ahead in this direction Cisco has announced a number of initiatives for its channel partners.

For its channel partners Cisco launched the Teaming Incentive Program (TIP). Edison Peres, SVP, Worldwide Partner Organization Go-to-Market Group called it the “fourth pillar” of their incentive program line-up which includes Value Incentive Program (VIP), Opportunity Incentive Program (OIP) and Solutions Incentive Program (SIP).

He elaborated that TIP is to encourage early sales engagement and reward partner investment in consulting and professional service capabilities. The way it works is: after the partner is identified and qualified by Cisco and s/he agrees to team with Cisco.

The reward will be in the form of differential discounts in recognition of their investment in the deal. A TIP pilot has been running since last 18 months in Latin America and has been successful in incentivizing the partners to make pre-sales and certification investments, effectively promoting better sales teaming. Implementation of TIP will be done in phases beginning July 2010 and is likely to be through by December 2010.

Cisco core team leaders were all there at the Summit sharing various aspects the new initiatives will play out in the market. As were their channel partners sharing their stories on how it worked for them.

Cisco also launched the Global Partner Network (GPN) to help partners collaborate and win multinational business. GPN provides channel partners with the framework to collaborate on transacting and fulfilling global business requirement.

Here is how it works: The GPN allows for a Host-Agent relationship between Cisco partners globally. A Cisco channel partner acts as a host partner in the headquarters location of the customer. Now, to meet a business need where the host partner may not have a local investment it can establish an “agency” relationship with other qualified Cisco partners and distributors in remote locations.

The customer relationship is owned by the host partner. He designs the solution architecture in the customer-headquarters location, and is responsible for the overall transaction.

An online portal (Cisco Commerce Workspace) allows the host partner to manage the global deal, secure Cisco approvals, and manage agents by remote country. The GPN is scheduled for implementation in Q4 of 2010. Nasdaq-listed Cisco follows August-July fiscal year.

Since borderless networks is the basic platform on which Cisco is building solutions with data center virtualization bringing in collaboration and cloud-based services, the company is playing an enabler-role helping channel partners specialize in Cisco technologies and develop integrated practices around borderless networks.

The company is investing in training its partners to develop architectural sales capabilities. This will help partners sell consultative services and architectural solutions, enabling them to grow to the next level.

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