Naresh Wadhwa, President & Country Manager, Cisco - India & SAARC
Channel partners are vital to Cisco for many reasons: for the company’s success, its ability to grow rapidly and maintain margins, reach markets anywhere in the world, and offer the best products and services to customers. In fact, over 80 per cent of Cisco’s revenue flows through the channels, making indirect sales the route-to-market for the company.
Partners are the route to market
While Cisco has been acknowledged as having the best channel programme in the IT industry and we recognize this as our biggest competitive advantage, investing in partner enablement is a constant area of focus for us. We believe partner enablement is important in order to build capacity, expand capabilities, and enhance loyalty - all critical to our business.
While Cisco has industry-leading channel programs today, the Information and Communication Technology sector is changing rapidly and the pace of change is accelerating as well. Customer dynamics are evolving as consumer-driven Web 2.0 technologies and practices impact businesses and governments, while the competitive landscape continues to shift dramatically (e.g., Microsoft/ Nortel). At the same time, Cisco’s growth objectives are increasingly reliant on indirect sales (e.g., SMB).
In anticipation of market transitions and to maintain industry leadership, Worldwide Channels initiated a fact-based, collaborative, long-range planning process in early FY’07. The resulting Channels 2010 plan is the roadmap to ensure our ongoing and future success. Our vision of the future - for Cisco and Channels - is brighter than it has ever been, and the Channels 2010 plan is how we will build Channels 3.0, together.
Studies and surveys that we undertake reveal that partner loyalty is at healthy levels. However, we are also aware that in today’s dynamic environment competition for loyalty and mindshare has been increasing. In addition, the operating environment is changing and the pace of change is enhanced as well.
For instance, today we need to study and focus on changing customer dynamics like never before. As SMB customers become more network reliant, enterprise customers turn more global, and consumers become the drivers of web 2.0 adoption - we need to enable ourselves and our partner community to address the needs of this new environment.
Further, trends such as increasing verticalization, ETG and digital media accelerating video and software will also need to be addressed. As newer growth opportunities appear, competitors will also get more sophisticated and non-IT channels will emerge. Partners too are going broader, deeper and global while VARS are becoming managed service providers.
At Cisco, our endeavour going forward is to transform the customer experience with the world’s best partners. Not only by creating capacity for growth but by also accelerating partner and customer success.
For our partners this means creating the leading partner experience with innovative programmes, processes, and systems and ultimately building the world’s leading forward supply chain. With enhanced capabilities and services that elevate the customer experience our channel partners are set to become valued solutions providers and trusted advisors.
With Cisco’s future growth potentially coming from new or adjacent markets, our channels including our partners and our programmes will need to be more adaptive in the future.
As the network becomes the platform for all forms of communication and IT, it becomes increasingly important for such as Cisco and the partner community to provide services that have the potential to integrate and optimize technologies.
Today, we are focused on moving up the value chain for our customers: from offering boxes and systems to offering solutions, we will bring vertically relevant, industry leading solutions to our customers. Hence, Cisco must continue to invest and enable its partners’ transformation into highly valued solutions providers.