Posted by Tirthankar Sen on July 16, 2013
I attended my fifth Cisco Worldwide Partner Summit in Boston the first week of June. As always, the first day’s keynote presentation by John Chambers was impressive and covered market transitions, opportunities, future big bets, and how Cisco can work better with its partners. John also stressed the need for partners to embrace change and move to a new business model.
Building on this presentation, Cisco made three key announcements at its partner summit, which I’m highlighting below because I believe they are especially important for partners that operate in Asia Pacific (AP) markets:
- Cisco has committed to doubling its investment in the mid-market space globally from US$75 million to US$150 million in FY2014: Typically perceived as a large enterprise-focused company by partners and mid-sized businesses alike, Cisco’s announcement that it would double its investment in demand generation activities, building its mid-market portfolio through new products (e.g., the low-cost router developed in India) and through acquisitions (e.g., Meraki), and incentivizing sales people is very timely. With a large mid-sized business population in Asia Pacific, proactive efforts toward creating a mid-market brand will help establish Cisco more firmly in the space.
- Cisco dCloud, a cloud-based demonstration service for partners, is now available: One of the major challenges for AP-based partners is their inability to invest in costly demo equipment or visit vendor demo solution centers. The availability of Cisco dCloud will not only help partners increase their chances of winning a deal, but also potentially help them reduce the sales cycle, making it a profitable deal.
- Cisco introduces cloud business transformation tools: In my earlier blog post titled Channel Partners Are Embracing Cloud in Big Way – But Still Need Help, I wrote about partners needing support from both tech vendors and distributors in order to bring about change or transformation in their business models. Cisco’s announcement of its new enablement tools including a cloud business transformation playbook, business transformation workshop, and business transformation video-on-demand, will support partners who take that first step toward building an annuity-based business model.
Despite good progress on the partner front, I failed to see enough push from Cisco for a comprehensive ISV strategy. With software playing a far more important role in areas like networking, cloud, and infrastructure management among others, tech vendors like Cisco will need the influence, might, and support of ISVs in the long run.
The other area Cisco must still address is its leasing and financing solution offerings. As partners transform their business models, invest in building cloud infrastructure, and invest in new skills, they will require access to capital, flexible pricing options, longer credit periods, and faster cash flow. Currently underutilized, Cisco Capital has further opportunity to play a major role in all of these areas.
I believe Cisco has set its partner strategy course in the right direction in AP with an increased focus on mid-market and transformation tools for its partners. However, watch this space closely. Cisco’s partner strategy is likely to evolve even further over the next few months, particularly with John Chambers stating very clearly in Boston, “This time next year, I expect it to be all about software.”