Cisco Offers More Details On New Services Opportunities

Cisco is launching a series of new channel initiatives allowing partners to enter service deals early, enabling them to continue working with customers implementing geographic expansions.

During the first full day of the Cisco Partner Summit Tuesday, company executives outlined major channel initiatives that include the implementation of a Teaming Incentive Program, the launch of a Global Partner Network and the implementation of a series of architecture-oriented specializations.

One of the most significant channel initiatives is the Cisco Teaming Incentive Program, slated to be phased in during July, which executives say is designed to encourage partner involvement earlier on in the sales cycle, while rewarding partners for their previous consulting and professional services investment.

Cisco executives said that in the past, partners that came in late to deals effectively failed to be recognized for their value or expertise.

"Partners are much more relevant today than they were in the past," said Edison Peres, Cisco senior vice president of worldwide partner organization and go-to-market group,. "This is where they drive profitability. You can't drive a services practice if you're not early engaged in the deal."

Peres said partners can bring more value to a deal with their consulting and professional services expertise coupled with the product and technologies they offer, he said, adding that it was crucial a partner be brought in early for that expertise to be adequately leveraged.

"(The Teaming Incentive Program) has the philosophies to make sure we have the best proposition value to our partners. They can add their value and make money," Peres said, adding that the recurring revenue model provided by professional services is where most partners will make their margin.

"Early partner engagement is critical. If we don't' bring in the partner early, by definition we're not doing them any good," he said.

Next: Cisco Execs Explain Two-Tier Service Strategy

Cisco executives asserted that the company utilized a two-tier services strategy, that which is "customer-led" and that which is "partner led, Cisco-enabled." Essentially, the "customer led" model would allow partners to become involved in some of the top tier, or what executives termed as "transformational accounts," by providing "incremental value" throughout the sales cycle.

Company executives emphasized that these transformational accounts didn't necessarily imply a "hard deck" of customers that would do direct business with Cisco, although these "transformation" customers could indeed purchase Cisco's products directly from the vendor.

"It's not about creating a hard deck. We've identified these customers that we want to create a different experience with Cisco," Peres said.

Cisco termed the second tier of its services strategy "partner-led, Cisco-enabled" which indicated that the partners was to take the lead on the deal but had access to Cisco support and enablement in the background.

Under the Teaming Incentive Program, Cisco would determine which partner is entitled to the benefits of each customer deal, based on criteria that included existing customer relationship, pre-sales investments, certifications, specializations and previous investments in related professional and technical services.

Once Cisco determined the most qualified partner, he or she would have access to special discounts recognizing their previous investment.

Meanwhile, during the Cisco Partner Summit, Cisco executives also announced the impending launch of the Global Partner Network, set for general availability during Q4 2010, and designed to help channel partners collaborate with remote and overseas partners as their customers expanded their businesses across state and international borders.

Essentially the program honors the fact that many customers want to continue the relationship with their local Cisco channel partner as they expand their business overseas, executives said.

"Customers are globalizing, we see customers going global, and it is being accelerated by the technologies," said Surinder Brar, Cisco director of worldwide partner strategy and programs. "We want to make it easier for customers to work with their preferred local partner."

Subsequently, the Global Partner Network provides partners a framework through which they can collaborate and conduct transactions on a global scale while retaining their customers throughout the expansion process.

Specifically, the framework entails the establishment a Cisco partner to act as the "host" partner in the headquarters location of the customer, who can then establish an "agency' relationship with other Cisco partners in remote or international locations. However, the host partner owns the relationship, designs the solution architecture and oversees the entirety of the sales cycle, from pre-sales to post-sales.

Finally, Cisco announced that it planned to increase and expand channel specializations from technologies-centric to architectures-centric, which would essentially enable channel partners to buy into select specializations in order to be involved in the top-tier deals.

The company is also helping to train partners to develop architectural sales capabilities, with new curricula for "business architect" and "technical architect" designations, ostensibly aimed at helping partners sell consulting services and architectural solutions.