Cisco to lure resellers with incentive program

HONOLULU– Cisco will spend this year’s Partner Summit building upon last year’s theme of partner profitability and high margin returns by introducing a program that takes a phased approach centering on incentives.

Steve Simmons, channel manager for Cisco

Systems Canada, said the incentive program will be offered across the board and is aimed at injecting more profit into Cisco’s channel business, protecting upfront partner costs and adding resources such as MDF funds to those with advanced technical practices and services.

“”The new program is all about layering with additional elements, such as enhancing all components on delivery, additional profitability and the launch of an incentive program,”” Simmons said. “”It’s for hunters of new opportunities and we wanted to reward them for getting that new opportunity.””

Cisco also wanted to help partners who are trying to add more value to IP telephony and communications solutions early in the deal cycle.

“”The focus is around furthering the strategy in advanced technical solutions and to realign (the solutions) toward vertical markets,”” Simmons said.

Murray Wright, Ingram Micro Canada general manager, said Cisco’s partner profitability program is working in Canada.

“”You have to experiment on which buttons to push and I think Cisco is pretty tuned into the marketplace,”” Wright said. “”I would not bet against them and the incentive program can generate enthusiasm and excitement.””

Dan McLean, lead networking analyst at IDC Canada of Toronto, agreed with Wright, adding that Cisco’s partner program last year set a standard in the networking industry.

“”I find the new incentive program to be an unconventional approach. It not just about volume for Cisco,”” he said. “”They want partners to step up in the emerging technologies. Cisco does a lot to drive new technology in the market place and it is the partner’s time to adopt them. Strong incentives for partners will do that over volumes. It is more about ideas than volume.””

The company also has a new plan targeted specifically to smaller Cisco partners. Simmons, who did not want to disclose any details about this plan, said it has a different go to market strategy, offering additional investments and benefits.

Security will also be a priority at the conference. Last year Cisco teamed up with several security vendors for its advanced technical solutions side of the business. Simmons said security for IP telephony is a critical mass market opportunity for the company and its partners. He also said announcements on storage, wireless and the future of the Linksys product line will be forthcoming. Cisco bought Linksys, a vendor of home networking equipment, for US$500 almost a year ago.

Wright said he is also interested in Cisco’s Linksys strategy and how it will integrate those products into the company’s lineup.

“”(Cisco) is moving into that SMB market place and that is the next frontier for Cisco. They have done an excellent job in the enterprise space and they will look at how to growth the business and move it downstream,”” Wright added.

McLean said that Linksys could be Cisco’s arm to penetrate the SMB space.

“”I am interested to see what Cisco does to create a partner program that addresses SMB. (Hopefully) one that goes beyond discounts on volume and instead gets the smaller partner focus on delivering some kind of value add to the customer set through services or high customer touch,”” McLean said.

McLean added that he expects some kind of new go to market strategy on transitioning Canadian partner to become managed service providers for IP telephony.

“”It is all about managing risk. A customer can pay for it as a service the same can be said for storage or security. Newer technology lends itself to an on-demand (model). They can try it and see if they want it instead of spending capital investment dollars in new technology. This way it minimizes the risk,”” McLean said.

Cisco’s Partner Summit officially begins on Wednesday.


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