Cisco, Linksys To Beef Up Partner Ranks For SMB Push
At the same time, the company's Linksys division is prepping major channel investments for the coming year.
Cisco now has about 3,000 solution providers worldwide participating in its SMB Select channel program, which is for partners that focus on smaller customers. Plans call for the San Jose, Calif., networking giant to double that number over the next two to three years, Keith Goodwin, senior vice president of worldwide channels at Cisco, told CRN at this week's Cisco C-Scape Global Forum 2006 conference for industry analysts.
"We clearly need to build capacity as we take advantage of the SMB opportunity," Goodwin said. In the United States in particular, Cisco wants to build SMB partner capacity in terms of the number of partners and the amount of revenue each partner brings in over a given period, he added.
The recruiting efforts will focus on partners working with Cisco through distributors. At the same time, the company is investing to enable a "stronger Cisco touch" with those two-tier partners. "We're investing in specialized training for two-tier partners, building systems and processes for two-tier VARs and perhaps some incentives," Goodwin said.
Those changes will come as part of the upcoming next generation of the SMB Select program, which was launched in the United States in 2004 for partners working with accounts of less than 500 users. Cisco aims to add new tools and incentives to the program to ensure that solution providers can create sustainable, profitable business around SMB accounts, Goodwin said.
The SMB segment is Cisco's fastest-growing market, largely driven by IP telephony and unified communications, according to Goodwin. "It's actually accelerating, and that's why we're excited about it. As we do projections going forward and look at the partner capacity we need to meet those aspirations, that's when [the need for more partners] jumps out at us," he said.
Cisco's planned channel recruitment and program overhaul also aim to tackle a challenge the vendor now faces in working with SMB-focused partners: They typically seek to move up the food chain into larger accounts.
"When we bring an SMB Select partner into the fold, they'll focus on SMB for about a year, but then they aspire to move up to midmarket and larger accounts," Goodwin said. "We want to ensure there is a good, profitable business model [to sustain them in the SMB space.]"
Cisco, too, will supplement its SMB product portfolio in the coming months with new offerings that are built from the ground up with smaller customers in mind, he said.
As Cisco seeks to bolster its SMB partner ranks, the company's consumer/small business-focused Linksys division also is readying major channel investments in 2007, according to Nigel Williams, vice president of sales at Linksys.
"Calendar year 2007 is going to be a big year in terms of building out a more robust channel program and putting more CAMs [channel account managers] in the field. We've historically relied on distributors and telesales," Williams told CRN. He said Linksys also is hunting for executives to fill two new positions: a worldwide channel lead and a worldwide service provider lead.
And as its product portfolio becomes more complex, Linksys is looking to add certifications and specializations around its technology, though changes are at least three months away. It also plans to define a clearer migration path for partners and customers to move from Linksys platforms to Cisco gear as they grow and to create a more coordinated look and feel between its partner program and Cisco's, Williams said.
"It allows us to target Cisco SMB VARs that are carrying D-Link, Netgear or 3Com as their second brand," he said.
Currently, about 60 percent of Linksys product sales through VARs are on the consumer side, a percentage that's decreasing dramatically, Williams said.
Linksys also will seek to recruit new solution providers into its channel fold, particularly those that can handle more complex solutions and those with VoIP expertise.