Cisco Systems is stepping up its investment in the channel with the rollout of a simplified partner-led sales model aimed at enabling the networking leader to respond more quickly in the sales trenches to fend off competitors, said the company’s top sales executive.
Cisco channel partners will see more resources, stronger marketing and faster decision making from the networking leader, all as a result of its dramatic restructuring, said Rob Lloyd, executive vice president, worldwide operations at Cisco, San Jose, Calif, in an exclusive interview with CRN.
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"We're going to move faster," said Lloyd. If we need to make a decision or a change on something, we're going to move more quickly. I expect we'll react in competitive situations in a more aggressive fashion and continue to deliver the consistency our partners expect of us."
Cisco will be pumping more money to back its channel-facing field sales teams and its channel support efforts, he said.
"My expectation is that more of those resources will be in the field teams that face our partners every day and engage in our partners, but I'll be very candid that we will put more into marketing programs over the next year. More into systemic investment to support the relationships with partners, their sales teams and their engineering teams and more into helping them build their practices," Lloyd said.
Lloyd, who is widely viewed as a potential successor to Cisco Chairman and CEO John Chambers, emerged this year as the public face of Cisco's defense against competitors like Hewlett-Packard, which are looking to eat into its lucrative networking sales and pull away channel partners. In the interview, Lloyd again went on the offensive, describing how Cisco's restructuring efforts will benefit the channel.
Going forward, Cisco will have two go-to-market models: "customer-led," which will be Cisco's traditional high-touch selling motion for large and strategic enterprise accounts, and what Cisco's calling "partner-led," which according to Cisco means a greater focus on sales through channel partners to all but its most strategic global accounts.
That partner-led model, said Lloyd, will mean more of Cisco's overall resources -- not less -- are headed for the Cisco channel.
Lloyd also said the company will become more nimble, allowing it to react in competitive situations much more aggressively and with less time spent mired in deal-weakening bureaucracy.
"We expect we're going to move faster," said Lloyd. "We've done a lot of things so that as we enter the next fiscal year, we're going to be faster in decision making with more accountability, less people who need to be in a room to make a decision, and more people who will be empowered to say 'yes.'"
Cisco needs to be simpler in its execution and get decisions made a lot more quickly on behalf of partners, he said.
"Sometimes when I visit with partners, when I visit with customers with our partners, there seems to be too many people required to make decisions," he said. "The networking industry has never moved more quickly than it is today. What we're doing is aligning our resources in a way in which there's much clearer accountability for decision making. [When it's] a matter to make a decision on a deal with our partner, we're going to do that faster, require less internal approvals to make these things happen."
"I would say we don't need as many people involved in decisions," Lloyd added. That he said, leads to more accountability and gets decisions "faster to the 'yes.'"
Cisco's focus will be on faster time-to-market, Lloyd said. It will also be getting more partners selling behind Cisco's architecture strategy, which allows partners to elevate the conversation with their customers on the basis of selling not only point products but future-ready network and data center architectures.
"The sustainable differentiation our partners bring is to have that conversation: here's how it all works together. [Partners can say] 'I have a practice that technically helps you do that, I believe the conversation is in the future, and I also have a service offering that will help you accelerate the results of that architecture,' Lloyd said. "That's what we're working on with partners: deploying the systems and architecture that personify the Cisco differentiation and we will continue the road we set."
NEXT: Cisco Partners Win In Services, Says Lloyd
As Cisco is continuously challenged by HP, Juniper and other aggressive threats to its core networking businesses, Lloyd contends Cisco will reinvest in partners to make them more profitable selling Cisco. One of the biggest advantages Cisco partners have is that Cisco turns over a majority of services opportunities to partners -- something that won't falter, Lloyd said.
"We build practices to accelerate the adoption of converged data center, private cloud, collaboration, virtualization, expert solutions that our customers can see and demand. [Partners] need to help build those practices they take into their services and into their businesses. That's the Cisco model," he said. "We're not out there at the end of the day competing with them and creating a hard deck of customers: 'You can go out and work with these players and we're going to take these ones direct.' That's not the Cisco model."
Cisco solution providers contacted by CRN said Cisco has a long way to go to make good on its promises of more resources and more profitably for partners as a result of the restructuring. But most agreed Cisco is saying all the right things as it attempts to right its ship.
"I am optimistic about the Cisco restructuring efforts – they are saying the right things so far," said Andy Cadwell, vice president of sales for INX, a Dallas-based solution provider and Cisco Gold partner. "As we all know now, Cisco as a whole has become a more bureaucratic, layered organization and more confusing to work with even with good channel support staff. Having U.S. field sales and channels across segments reporting up to a single head should foster more accountability and agility."
Cadwell said he's hopeful Cisco's restructuring will mean better alignment between Cisco and its channel partners at a strategic level.
"Re-examining channel partner profitability for their most loyal partners, getting much more succinct on Cisco's business-technology value proposition, defining Cisco's services posture and supporting vertically oriented partners like INX should all be top of mind as they move forward," Cadwell said.
Bob Venero, CEO of Future Tech, a Holbrook, New York solution provider, said it remains to be seen how the restructuring will ultimately impact partners.
"I don't know what the end result is going to be for the partner community," he said. "It's too early to tell. It takes a good amount of time to be able to turn a very large aircraft carrier like Cisco two or three degrees. It is going to take a while to see what the results will be. The hope is we'll be able to see something in the next two quarters that shows they are serious (about the partner led sales model) so we can see exactly how it will impact our business."
Steve Burke contributed to this article