These two words were the keynotes of the Cisco Partner Summit that took place in Las Vegas in early April 2007.

 

To reflect the sentiment, the show started with the usual hoopla.  This year it was a choir of African children, to a few of whom Keith Goodwin, Cisco’s chief of channels, spoke.  To his questions they trotted out suitably aspiring career choices: doctor, saint, president of Bongoland, CEO of Cisco and so forth.

 

Cisco’s own aspirations were more firmly grounded in reality and thus more interesting than the sentimental mush that went before. Partners have been a key aspect of Cisco’s success – a fact it acknowledged and celebrated.  There were 2400 partners present at the Summit, from 1000 companies and 90 countries.  Cisco intended to develop partners even more by focusing on small and medium size businesses (SMB) of less than 250 employees.   Heretofore Cisco had seen partners’ main role in developing the commercial segment (the mid-market of 250-1000 employee enterprises).

 

In addressing SMB, Cisco recognised it would have to make products smarter, simpler and easier to service. As one of the speakers explained, they had to be ‘plug and play, not plug and pray’. Complexity had to be removed from products as many potential partners perceived Cisco products to be complex and challenging.

 

Cisco revealed more of its thinking about partner relationships.  It will deliver to SMB through one of two classes of partner: large ones such as telcos who already have SMB activities and SMB-focused partners.  It was this latter class where most refinement and encouragement has taken place. The typical SMB-focused partner does 15-20% of its business with Cisco.

 

Partners needed sales incentives, demo equipment, training and were very keen on getting certification.  To satisfy this Cisco has created an entry-level certification of SMB Select.  This opens up free e-training, access to easy leasing finance, an on-line location facility and shared space on the Cisco website. As partners improve their performance and commitment to Cisco, they may grow to Premier, Silver and Gold standards in SMB Select.

 

The announcement of the new was saved until the second day.  The key offering in Smart Business Communications System is the Cisco Unified Communications 500 series.  This simple platform supports IP phones, Internet connections with firewall, VPN and wireless LAN access and support through desktop applications. It is being marketed in the US at a price of about US$ 700 including a phone.

 

There are other products in the Smart Business Communications System including the Catalyst Express power over Ethernet switch and wireless access point and controller devices.  There is a Monitor Manager to provide alerting and reporting of communications issues.  A complement to this product is Monitor Director, a product for partners to provide a centralised network management service to its customers.

 

Demonstrations were arranged to show that a Smart Business Communications System could be set up and running within a few minutes.  At least, experienced Cisco staff could set up a system in a conference room in the presence of analysts and journalists in a few minutes.

 

Cisco wants all its partners involved in SMB Select to have this facility.  Accordingly technical e-training courses have been set up, available free of charge.  In addition there are sales and marketing e-training courses.  These are now in both English and Spanish with the intention that similar content will be available in up to 23 other languages.

 

Cisco’s established approach to services has been through Shared Support Partners who enjoyed 72% - 83% discounts for participating.  About 15% of partners dropped away from this scheme.  It was abandoned on 2^nd April 2007 when support for US$ 6 billion of installed equipment moved to a new scheme.  This was characterised as a move from ‘free’ to ‘fee’.

 

Cisco Smart Care Service aims to offer both SMB and mid-market customers network level maintenance and repair proactively and remotely, through partners. There will be a single customer service maintenance contract delivered through a certified partner but reliant on Cisco networking expertise and tools. The aim is to provide the tools as a knowledge based system (KBS) through Web 2.0.  This was the reasoning that lay behind the acquisition of Web-X earlier in the year.

 

It will be a global offering rolling out during the summer and fall 2007.  As part of the global commitment, Cisco will have its SVP for Services based at Bangalore in India as Chief Globalisation Officer.  More than 10% of Cisco’s service management team will be based there.

 

Cisco Smart Care Service pricing will be simple.  It was suggested that an entry-level system would be supported for less than US$ 1000/year.

 

Cisco believes that for partners to achieve optimum profitability they should look for opportunities to differentiate their offerings.  It may be that as time goes by and Smart Care Service develops, some partners will become differentiated to the degree that they become service specialists.

 

Cisco sees its prospects – and those of its partners – poised for massive growth.  Opportunities are opening up in many areas as the Internet transforms ways of working, playing and thinking.

 

“Our children’s approach to the Internet will be the business model of the future”, said CEO John Chambers. “Most applications will settle down in to the Internet”.

 

Sue Bostron, Marketing Director and a Hillary Clinton look-a-like, took up the theme by showing how networking had moved from the enterprise model of the 1990s to the websites and bulletin boards of the early 2000s to the human networking characterised by YouTube, Second Life, blogs and webcasts of today and the immediate future.  Not only did this have significance for Ciscos’s products and partners, it also meant new ways of putting out marketing messages.

 

“We are probably no. 1 in about 12 market sectors”, claimed John Chambers.  “This is unique in the IT industry”. It provided a springboard for both Cisco and its partners to achieve much in the years to come.

 

TekPlus View

Cisco has achieved enormous success in the networking world. It has grown organically and through acquisitions to become the dominant company in this field. It has been a company recognised for its technology rather than its brand. This is now changing for it will not penetrate the SMB sector on technology alone. In the SMB space it needs brand and it needs channels.

The key elements in this approach are certification and services. TekPlus endorses SMB Select as a sure fire winner provided Cisco maintains quality and price in its Smart Business Communications System with product development to keep it ahead of the competition.

The new service package is quite revolutionary and while TekPlus cannot fault the concept – it bears comparison with HP’s OpenView - there are some question marks over go-to-market. The main one will be maintaining delivery quality and consistency through partners of widely differing competence and commitment. After sales service – to use the old fashioned phrase – is not something that sits comfortably on all corporate shoulders. Cisco services people must keep close control of the partner network.

The second question mark is over pricing. Claimed to be so simple it can be listed on a postcard, it seems remarkably difficult to draw out specifics from the company. What’s the problem Cisco – international pricing? Cost based? Uncontrolled partner price uplift?

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