Cisco infuses channel with money and confidence

Cisco infuses channel with money and confidence

New Zealand regional head talks at Boston partner summit about the coming year

Cisco New Zealand country manager Geoff Lawrie sat down with vendor-hosted Reseller News at the Cisco Partner Summit in Boston in early June.

The company's CEO, John Chambers, had opened the summit with a presentation that included information about the networking and UC giant's growth compared to competitors. Suffice it to say, Cisco has had a good run.

"My overall impression is this is very front-foot," Lawrie said. "This is a confident presentation about where we are, and some of that is around the background and the good financial results we’ve had, the acquisition strategy and R&D are pulling things quite tightly together."

Cisco will now put its money where its enthusiasm is, pledging millions on incentives and programmes aimed at developing business with 100-user to 1000-user companies, which is considered mid-range in the US and other larger markets. The vendor is also doubling its investment in marketing, with a US$150 million global spend to help Cisco fulfil its pledge at the summit to generate $1 billion worth of qualified sales leads for partners in the new fiscal year that begins in August.

"The programme is effectively a rebate programme around partner profitability," says Lawrie. "A way to a partner's heart is always throught the P&L. We want to be the most profitable vendor they deal with."

Lawrie says the New Zealand market will get a sizable portion of the rebate funding, as well as its fair share of lead generation commitments to partners.

Perhaps at the crux of Cisco's approach to smaller companies is its cloud reseller programme, also announced at the summit.

"This is really important for us in New Zealand as one of the biggest challenges in our market for us is the issue of scale," says Lawrie. "It’s lovely having these big programmes but you put that in a market with small scale business and it doesn’t make sense. And Cloud is a big boy's game. It's s big money to get into it and there is real compeitiotn from Rackspace and AWS."

The reseller challenge, Lawrie says, is their customers can get on the web and order a vritual server and small network for $25 a month and they can’t afford to build the infrastructure with the sophisttication and scale to provide the economies to compete.

"Cisco is recognising that some of our reselllers will definietely ante up into it, building sophisticated infrastructure, such as Gen-i with its ReadyCloud service and Datacom for its ATS," Lawrie says. "But all of the small tier. We’ve got 460 registered resellers and half a dozen have the capacity to build a datacentre."

"Ths programme provides a way in which we will support the guys who do build the cloud to whitelabel the service to these smaller guys. Cisco is validating the quality of the service and facilitating the sales transaction."

"After so many years in the industry, I’ve seen lots of revolutions promised that turned into evolutions," Lawrie says. "We weren’t wrong about the direction and relevance but about the timing."

"I have been surprised about the speed with which the cloud has gotten onto people’s agenda. There is a lot of people evaluating but small percentage that have actually shifted. Few people are saying , nah, not relevant to me."

Cisco A/NZ partner business group director, Sara Adams and Cisco A/NZ managing director, Ken Boal also pledged wide partner support during a presentation at the summit.

Boal claimed there is a huge volume and appetite in A/NZ to use technology to transform its customers' businesses and the digital disruption is a C-level or boardroom decision now.

"We want to go an additional step with our partners in how we help solve customers' business problems and not just provide basic IT solutions. It's about stepping up and having a material impact on their business and the cloud is one of those transitions that enables it," he said.

Boal claimed it will change the way Cisco engages with its partners and customers by positioning its partners' cloud solutions alongside its offerings.

Within the mid-market space, Adams said Cisco A/NZ will be increasing its investment in the region to generate demand on behalf of its partners.

"We're seeing more cloud adopting in the mid-market because these businesses decide quicker and have the ability to quickly change from a capex to opex model. So we will be increasing marketing and demand generation direct to the customer," she said.

Adams said the company will also continue to identify independent software vendors (ISVs) and start to work with its partners locally on selling its horizontal message and targeting that into particular verticals.

Moving forward, Boal claimed that the channel should be transitioning their discussions from 'if they do use technology to transform businesses' to 'how technology supports their businesses'.

"Probably 10 years ago, we were knocking on doors asking businesses to get excited about the role of technology but now the doors are wide open and causing the role of the IT leader to become less of a technical leader and have more of a business focus."

Boal advised every investment to have a business case and for the channel not to underestimate some of the softer returns they get from their technology investments.

"Things like employee retention for example, is important because employees might be leaving an organisation due to a lack of modernised way of working and the right set of tools to improve their productivity.

"You can also tap into technology at a lower cost than before so instead of having to build your systems from scratch, you can do smaller projects to test before deciding on it," he said.

Boal also mentioned that within the services space, compliance, security and data analytics are key areas that channel partners should look into.

"The opportunity for partners in this area is massive. Partners that can move into that will experience huge growth and add value to the link between the network and the higher order applications and business processes," he added.

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