Partners: Simpler Cisco Will Be A Better Cisco

Top Cisco partners think Cisco will emerge from its restructuring a simpler company -- one that's a lot easier to do channel business with, even if Cisco still needs to hammer out the details of its "partner-led" strategy in a way that makes more sense to its solution providers.

Dave Elsner, vice president of sales and marketing for Nexus Integration Services, a Valencia, Calif.-based solution provider and longtime Cisco Gold partner, said he welcomes Cisco returning its focus to the core networking solutions on which its top partners drive sales.

"They built this phenomenal LAN/WAN network, and started overlaying all of these things and probably got too diversified and too thick," Elsner said. "It's good for the partner, because when they're not in the consumer markets, when they're not in things like Flip video, that puts the attention back on the growth of what's important to me."

Elsner was among several top Cisco partners interviewed by CRN from Cisco Live in Las Vegas this week, where Cisco on several occasions spoke about its corporate restructuring efforts.

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Chairman and CEO John Chambers, CTO Padmasree Warrior and other executives spoke in keynotes and in more intimate sessions with reporters about how changes to Cisco's corporate structure will mean faster time to decisions and less bureaucracy. Both were points also made by Cisco's Rob Lloyd, executive vice president, worldwide operations, in an exclusive interview with CRN this month.

For some of Cisco's key partners, those efforts are already showing returns.

Jere Brown, CEO of the Americas for South Africa-based integrator giant Dimension Data, said that one of the problems he'd had with Cisco previously was that with different regional sales managers, it was difficult to drive consistency with Dimension Data-led Cisco sales in various Americas regions.

"To have the kinds of resources needed to support our go-to-market effort, we had to deal with multiple leaders across multiple parts of the Cisco organization," Brown said. "That became even more complex when we were talking about global solutions. You had to go through so many levels of the organization to get someone to make a decision."

Now that Cisco's Americas sales theater is organized under one person -- Chuck Robbins, newly Cisco's senior vice president, Americas -- that effort should be streamlined, Brown said.

"Parochially, with it lining up to Chuck, a guy who understands both the channel and the direct business and the services, it's a great thing," Brown said. "I'd been asking Cisco for long time to have consistent Cisco resources up and down the Americas. It also aligns pretty nicely to the Dimension Data theaters around the world. It's going to simplify how we interface and engage with Cisco around the globe."

Next: Is The Competitive Pressure Getting To Cisco?

Many partners believe the competitive pressure is finally getting to Cisco. A senior executive for a national Cisco solution provider, said he, like many Cisco partners of his VAR's size, had been heavily courted by Cisco rivals like HP in the past year, and that Cisco's re-focusing couldn't come at a more important time.

"We all see HP out there beating the drum and coming at Cisco with all the muscle a company that's three times Cisco's size can muster," said the partner, who requested anonymity. "They've approached us several times. Cisco is an important partnership for us so I don't think we're going to cut and run any time soon, but now is the time for Cisco to get it right for the partners. I think you're going to see a lot of partners start to put less stock in their Cisco relationships if they don't."

"I think it's about time," said Sudhir Verma, senior director, consulting services for Force 3, a Crofton, Md.-based solution provider and Cisco Gold partner. "It's about time CIsco realized that the market has changed and that the priorities of customers have shifted a little bit, and they have to come up with offerings that are more solutions-driven."

Force 3 focuses heavily on the federal government, and Verma said customers are no longer interested in a "speeds-and-feeds" conversation around routers and switches so much as they want to hear about how the IT they're investing in will solve their problems in an ROI-conscious way.

What he's seen, said Verma, is a notable shift by Cisco to embrace partners that sell architectural solutions versus emphasizing legions of Cisco box-pushers.

"Market pressure has forced them to look at the partner landscape in a whole different way and it's definitely changing the way they interact with us," Verma said. "This whole restructuring and changes are good. It makes them re-focus. For all of us, that's a win-win."

Cisco's architectural approach will be the one to beat in the long run, he added -- if Cisco empowers partners to evangelize that approach for them.

"When you are in 17 different products and 11 of them are top notch like Cisco's are, you owe it to the customer to make them simple and combine them together in a way that solves that problem," Verma said. "The customer is not in the IT business. The customer is our Coast Guard, our Army, our folks who do things way beyond what they care about in IT."

Partners told CRN they're still a little confused about Cisco's "partner-led" model: a stated strategy, recently announced by Cisco, that will theoretically mean a greater focus by Cisco on sales through channel partners to all but its most strategic global accounts.

Dimension Data's Brown said he takes "partner-led" to mean working more collaboratively with Cisco and having Cisco let its key partners take the lead on selling architectural solutions to customers.

"As a strategic global partner, we have the skills, capabilities and resources to be able to drive sales of Cisco product and services," he said. "Incumbent upon us as a partner is to build the capabilities and competencies to allow systems to grow at the rate they want to grow, and then collaborate with folks who can make things happen for clients. Partner-led, we have the opportunity to do that, so that's music to our ears. The rubber always meets the road in the field, so execution in the field will be critical."

"What it entails is how they are putting some programs together to ensure the profitability against cutthroat margins from competitive pressure," said Ashish Upadhyay, senior manager for advanced technologies at World Wide Technology, a St. Louis-based solution provider.

If partners are the ones driving the bus on a sale, instead of Cisco, it lets partners invest more time and resources in winning Cisco business instead of staving off channel conflict, he said.

"It also means consistency in terms of how they do business. That allows us continued investment into Cisco technologies and allows us to do business in more of a partnership model," Upadhyay added.

Nexus' Elsner pointed to Cisco's Teaming Incentive Program (TIP) -- a newer incentive program from Cisco designed to reward partners extra points of margin for the work they do earlier in the sales process -- as a tangible example of how Cisco would drive partner-led.

"That's an indication," he said. "Maybe there's a customer they have a relationship with and they want to bring a new partner in to work on it. That's definitely a sign of being more partner-led. Cisco is coming to us with more tools to drive the foundation business, so we are seeing that investment back into the core."

Next: Less Complex Cisco Is A Better Cisco

Lawrence McNutt, chief operating officer at Special Order Systems, a Loomis, Calif.-based solution provider, said the complexity in working with Cisco is in both partnering and in products and systems.

For example, he said, many of the support packages and software licenses for Cisco collaboration and UC products -- one of SOS' specialties -- are simply too tough to navigate.

"The internal resources to deal will all of those complexities -- the cost burden is just too high," McNutt said. "The licensing models -- the selling, managing and support models for the licensing -- have really challenged us. Every part of the software seems to need three different SmartNet SKUs, and it's hard to figure out which of 28 programs to quote. When I talk to my Cisco support team. they don't know the answer. I go to a distributor, and they don't know the answer."

The partner-led strategy is encouraging, he said, if it eliminates channel conflict in the Cisco sales trenches. Cisco has been a leader among vendors in incentivizing its direct sales teams to focus on partner sales, but there are still many situations where there's bad behavior, said McNutt. He said he sees it most often in customer consulting situations.

"When I bring in Cisco and say, [the customer] is going to look at four applications because that's what the customer asked for, there's a serious reaction to the point of hostility," he said. "What I get is 'Wait a second, we lead this, you're the partner, and if you're doing that, that means you're not a good partner.'"

McNutt said he hopes "partner-led" means a greater degree of sensitivity to the work partners do to win Cisco business.

"I've had situations recently where Cisco reps tried to exclude me, because they wanted to make sure they led the engagement," he said. "When they do that with client that you've engaged with for multiple years, it doesn't give you a good feeling. And in many of those situations, the choice of Cisco was the right choice for the client, but because they saw that, it didn't make them feel good about it."

Overall, partners agreed, if Cisco can simplify and follow through on its plan to focus and grow behind partners, all of the members of its partner community will thrive that much more.

Rob Schilperoort, vice president, cloud product management at ACS, a Xerox company, said that because ACS and Xerox partner with Cisco both as a strategic vendor and an integrator, the relationship between the two won't be immediately impacted by the restructuring.

That said, a leaner Cisco will be a positive for product development, he said, which will benefit everyone.

"When it's a lot clearer how to work with Cisco, because of that, they'll get better market feedback," Schilperoort said. "It'll make their products better and it'll allow them to innovate quicker, and they'll stay on the top of their game."