Cisco Unveils More Channel Program Changes

Giving resellers a preview of what to expect from its revamped channel program, Keith Goodwin made his public debut Wednesday at Cisco's Partner Summit in San Diego.

In addition to explaining the changes to its partner program Cisco already has announced this week, Goodwin, the company's senior vice president for worldwide channels, offered a few more tidbits to the crowd of nearly 4,000, some of them effective now and others to be delivered as late as next year.

The biggest addition is a new offer-based strategy in which Cisco will launch three new programs that will assist and reward channel partners who deliver global resale, outsourcing and managed network service offerings. The global offering is available now, and the latter two will roll out later this year.

"This supports how customers want to buy technology, and it's better aligned with their business model," Goodwin said.

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In addition, Goodwin announced that the company is reducing the number of its Opportunity Incentive Programs (OIP) from eight to two, it is consolidating its Solution Incentive Program (SIP) into a single program with increased rewards, and it is adding wireless LAN technology to its Value Incentive Program (VIP). Cisco also is adding tiered rebates and new Gold-level incentives to VIP, but they won't go into effect until the launch of VIP 9 in the second half of 2007.

The changes are Cisco's response to what company officials have been hearing from partners since Goodwin took over from Paul Mountford last summer.

"At the top of the list of what we've been hearing from partners is that we need to be easier to do business with," Goodwin said.

As part of this effort, the company has created a Customized Partner Intelligence solution that enables partners to customize content for customers using their own letterhead to use as a marketing tool. Cisco also will begin sharing the same competitive information with partners that the company's internal sales force has access to, and it has increased its investment in training programs, structuring them around the popular Integrated Services Router (ISR) delivery model.

Earlier on Wednesday, Cisco president and CEO John Chambers kicked off the show with a keynote address that highlighted the company's success at thinking about its strategic moves long before most of the rest of the market.

"We began changing our organizational structure three to five years ago, to move to a more virtualized environment, and it was about two or three years before we realized any productivity benefits from it," he said. "But in this business, you have to move three to five years before [the need for change] is obvious to most people; people that are just starting to think about it now are going to have problems."

Chambers outlined Cisco's vision for the network as the platform, saying the concept will create new opportunities for partners while allowing them to position themselves more strategically and capture higher margins "if you learn how to sell it right." One of the near-term goals for this vision will be what Chambers called "telepresence," sort of a souped-up version of videoconferencing that captures the dynamics of a live, in-person meeting, even if the attendees are dialing in remotely. It's a solution that he said is about one year from becoming reality.

"It's the ability to have unified communications set up with a couple of clicks, not by an IT person," Chambers said. "It's not just videoconferencing, but a real, collaborative experience."

Chambers also reminded the audience of what is perhaps the most compelling argument for partnering with Cisco.

"None of the other companies you partner with are No.1 or 2 in more than a few categories," he said. "We're No.1 or 2 in 12 categories, with a chance to take it up to 20."