Cisco Ups Investment In Major Channel Incentive Programs

Cisco is making across-the-board updates to most of its major partner incentive programs, including juicier rebates for its long-running Value Incentive Program (VIP) and sweeteners for several other programs.

The changes are part of an overall increase in Cisco's spending on incentive programs in its fiscal 2012 over its fiscal 2011 -- a move that squashes rumors Cisco would trim its incentive payouts this year as part of its ongoing corporate restructuring.

Ricardo Moreno, senior director, Strategy, Planning & Programs, Worldwide Channels at Cisco, declined to say how much Cisco was upping its investment in the programs, but confirmed in an interview with CRN Monday that the overall number is higher than last year.

Most of the changes center on VIP, the nine-year old incentive program that rewards partners based on their Cisco-centric technology practices, and which Cisco refreshes twice a year. Version 18 of VIP is now in effect.

Among the major changes are that Cisco's existing partner development funds (PDF) program -- which offers incentive payments for partners on certain types of deals to small business or midmarket customers -- has been renamed VIP Express.

Cisco partners participating in VIP Express will still receive quarterly payments, as they did under PDF, but Cisco sought to align the PDF program with the VIP program and streamline the process for participating, according to Moreno. The VIP Express piece is primarily for Cisco small business specialist, select and premier partners, he explained.

Some Cisco Gold level partners will also see fatter VIP payments going forward. Cisco Gold partners that participate in Cisco's Data Center architecture track -- previously known as the Virtualization track -- can temporarily bag a 2 percent rebate instead of a 1 percent rebate.

That won't last forever, said Moreno, but Cisco wanted to test out rewarding partners that by nature of the technology involved, have to invest more money to have their competencies recognized by Cisco.

"Partners have to make extra investment in that area," Moreno said. "We want to make it a little richer for them."

Other changes to VIP include the introduction of a WebEx subtrack in Cisco's Collaboration track, under which Cisco will qualify more partners to receive VIP rebates for selling WebEx. Specifically, Cisco partners that have either the Collaboration Architecture Specialization or Cisco's Telepresence Video Authorized Technology Provider (ATP) designation can now more easily access those incentives, whereas before, only partners with Advanced or Master Unified Commuinications designations would qualify, Moreno said.

"WebEx is a key part of the architecture and becoming more and more pervasive in what we do," Moreno said. "It's not only a piece of the U.C. element we had before."

A last booster specific to VIP is that Cisco partners that were invited into the Cisco Telepresence Video ATP program prior to the end of VIP 17 -- June 30, 2011 -- but did not finish the requirements for the ATP in time will be able to receive payment on eligible VIP 17 bookings in the VIP 18 period if they meet VIP 18 qualifications during the VIP 18 period.

"If they don't have the specialization or the ATP, they can't earn their rebates," Moreno said. "So we're giving them all the way to the end of VIP 18 to do it."

VIP 18 runs through Jan. 28, 2012.

Next: Other Cisco Incentive Programs Expanding

Cisco's VIP program is seeing the most changes as Cisco starts its fiscal 2012, but its other major incentive programs have also been tweaked.

Cisco's Teaming Incentive Program (TIP), which was first announced during Cisco's 2010 Partner Summit in San Francisco and has been in various pilots and test phases since then, was formally rolled out in the U.S. on May 31.

When it was first mentioned in April 2010, Cisco partners using TIP could earn 5 percent extra margin points on deals for which Cisco has qualified those partners early in the sales process -- it's a program designed to recognize partners' work on deals early in the sales cycle. Moreno said the terms of TIP at present are similar, and partners will see 5 percent on"most deals qualified under TIP.

Cisco's Opportunity Incentive Program (OIP) -- which covers deals in which a partner secures new business and brings it to Cisco's attention -- is also changing in that partners will see OIP deals confirmed by Cisco a lot faster. Cisco partner account managers have now been charged with coming back to partners in a matter of hours, not days, with a ruling on a deal's OIP qualification, Moreno explained.

That is for deals of certain sizes, Moreno said, and the threshold depends on geography and the type of deal. Moreno declined to be more specific on exact dollar amounts that qualify.

More changes have also arrived for Cisco's Technology Migration Program (TMP), a 10-year-old program in which Cisco recognizes partners that swap out gear from rivals, like HP and Juniper, for Cisco equipment. Cisco has broadened the types of products that qualify for TMP payments; for example, where before partners needed to swap out, say, a specific HP switch to qualify, many switches from a single HP switch family could qualify for TMP compensation.

"We were sometimes using too specific terms that narrowed down what really would qualify," Moreno explained. "This approach is on making it simpler."

Cisco later this year will be making more program changes specific to its Cloud Partner Program, which was announced at this year's Cisco Partner Summit in New Orleans and went live in mid-June, and also specific partner incentives within partner-led, the new Cisco sales strategy that will theoretically drive more Cisco product and service sales through the channel in all but Cisco's most strategic accounts.

Moreno declined to elaborate on those changes, except to say they will come in the form of new partner incentives.