Partners: Cisco Channel Commitment Is Paying Off In Big Sales Growth

Cisco solution providers say the company's deep investments in helping them navigate rapid technology shifts and now the cloud recurring revenue business model transition are paying off in big sales growth.

Partners attending the company's partner summit in Boston, Mass., said they are seeing double-digit Cisco sales growth and expect the pace of that growth to continue given Cisco's focus on driving recurring revenue business models with them.

Gary Alexander, CEO of Alexander Open Systems, a $200-million Overland Park, Kan.-based Cisco partner, said his Cisco business is up 26 percent this year with robust sales of the vendor's bread-and-butter network routers and switches, unified compute system and Cisco Meraki wireless solutions.

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"Things are going very well across the Cisco product line," he said. "We are now in Cisco's fourth quarter and our forecast is big. They are the best at helping partners make those transitions. They have the best partner programs of anybody out there. We make really good money with Cisco."

Alexander, one of 2,000 partners from 1,121 companies attending partner summit this week, said his business, driven by Cisco's products and services, was up $30 million in 2012, and he expects it to be up $36 million this year. Alexander Open Systems was singled out by Cisco with an award at the summit for best use of an application programming interface with a portal solution identifying real-time network trends.

Harry Zarek, president and CEO of Compugen, a $450-million Richmond Hill, Ontario, solution provider, said he expects his Cisco business to be up 12 percent this year. He said that is due to Cisco's ability to "figure out where the puck is going," and then team tightly with partners to capture those new opportunities.

"It is all about partner commitment," said Zarek. "There is no time wasted arguing about how to go to market. Cisco is very clean, very predictable. Lots of other people can learn lessons from Cisco on how to run a channel program. They focus on channel profitability."

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Compugen is planning to make significant investments in Cisco's new business transformation certifications for its sales and engineering teams to help drive the recurring revenue business model transition, said Compugen's Zarek.

"Cisco has hit the nail on the head," he said. "There are new lines of business decision makers. Historically, you could have gotten away with technology certifications. Those days are over. Business outcomes is what it is all about. Cisco is way ahead of other vendors in this business in seeing what is going on and preparing us as partners to be successful in the future."

Zarek said he sees a dramatic difference between Cisco's partner-centric model and the channel philosophy of his other vendor partners. "All the other guys talk about their product portfolio and why their products are good," he said. "But they don't talk enough about walking a mile in the partner's shoes and understanding our priorities. They don't do what Cisco does. Cisco has really internalized partner profitability and growth and the future business model."

Paul Whalley, vice president of Whalley Computer Associates, Inc., Southwick, Mass., said his Cisco business was up 68 percent last year after his company made significant Cisco investments, hiring six additional Cisco engineers and starting a unified communications practice. "Cisco is providing big opportunities with their willingness to partner and make us a central part of their SMB [small to medium-sized business]/midmarket strategy," he said.

Gladwyn Georgesz, the head of the networking business for Millennium Information Technologies Ltd., an $80-million Colombo, Sri Lanka-based Cisco partner, said he is seeing robust sales growth with the Cisco offerings.

"We are seeing good growth in the banking and telecom," he said. "We also see a lot of potential growth in the hospitality sector and manufacturing too."

Georgesz said Cisco has seen market transitions well ahead of competitors and led partners to those new emerging markets. "Cisco has continued to be a partner that sees the market trends, grasps them and aligns themselves to those market trends very fast," he said. "That is helping us. When we go to our customers, we are already in line with what they are expecting."

PUBLISHED JUNE 4, 2013