Cisco To Offer Channel-Neutral Compensation On Services


At the Cisco Partner Summit here, Cisco Systems disclosed plans to implement a channel-neutral compensation policy on services sales for its direct-sales force.

Under the new compensation model, scheduled to launch in August, Cisco's direct-sales force will receive compensation for 100 percent of Cisco services sales, including SmartNet maintenance contracts, whether they're sold direct or through a solution provider, said Wim Elfrink, senior vice president of customer advocacy at Cisco.

Currently, Cisco's sales force receives compensation for 85 percent of channel services sales and 100 percent of direct sales, Elfrink said.

The new model also will increase the compensation that direct-sales reps receive on sales of partner-enabled services to 80 percent of the sale, up from 13 percent.

"We're not competing with you. We're behind you, next to you," Elfrink said to summit attendees, adding that Cisco's new strategy should increase the overall services market around Cisco gear.

Cisco also previewed the Partner Consultative Support program, a new channel "mentor" initiative aimed at helping solution providers supplement their own services businesses around new growth technology markets.

Under the new program, offered as part of Cisco's Advanced Services portfolio, qualified solution providers will be able to purchase best practices and intellectual property from Cisco in areas such as planning, design, implementation and optimization to aid them in their early deployments of Cisco technologies.

Solution providers must earn the appropriate Cisco specializations before participating in the program, which will provide support around IP telephony, contact centers, multiprotocol label switching, VPNs and network infrastructure.

Partners would likely use the program for the first few deployments of a new technology before feeling comfortable enough to go it alone, Elfrink said. "We're making sure you get back-up support in first-time engagements," he added.

Hunter Dorroh, vice president of network integrator American Business Systems, Norfolk, Va., said the program will likely help newcomers to fields such as IP telephony, possibly to the detriment of those early adopters that already have made significant investments in building business around Cisco's products. "It's actually kind of bad for us," Dorroh said. "It helps others didn't get into [IP telephony] when we did catch back up."

The program will offer three levels of support: development, collaborative and review. With the development level of support, Cisco takes the lead on a project; under the collaborative level, channel partners take an equal role with Cisco on project development and service delivery; and under the review level, the solution provider leads the project while Cisco provides feedback and recommendations.

Elfrink said the program, scheduled to launch globally this month, will include a formalized price structure but did not provide details.

Cisco also introduced its Services Management System (SMS), a new Web-based tool solution that providers can use to manage the life cycle of SmartNet contracts.

The system eliminates the need for physical contract packages, captures customer registration information and provides advance notice of a contract's expiration date.

SMS is now available to distributors and authorized Cisco partners in the United States. Cisco plans to begin rolling the application out to international partners in the fourth quarter.