Cisco is leading business transformation in Africa

June 12, 2007 Lagos BAYO SANNI, Regional Channel Manager of Cisco in Emerging Africa, says the growth opportunities for enterprises on the continent is huge, and could be attained early by the implementation of the right solutions and several measures to help the market grow. Widely traveled, Mr. Sanni is responsible for Cisco’s channel market in Africa. In this interview conducted by BILL OKONEDO, he declares that the potential in the market has only been scratched.

You were recently quoted to have said that the Cisco reseller market in Nigeria will be worth over N50billion (US$350m) in 3 years. How realistic is this estimate?
The Nigerian market is rich with opportunities. Just look at all the service providers which understand that the IP (Internet Protocol) is the way of the future to upgrade their networks. The Mobile operators are going through tremendous growth which will require more and more infrastructure. The SAT-3 cable will drive ICT development in general to the service providers, private sector and public sector allowing efficient and state of the art e-government networks.

So as the network evolves into the platform for IT applications and services, our share of our customer's IT spend increases. This is evolving in all customer segments, whether it is enterprise, commercial, service provider, or in the public sector.

Cisco's perception from a business, government, and service provider perspective has never been stronger as these organizations evaluate our technology architecture to create a network-centric platform for their organizations, and, in many cases, are looking to Cisco to become a trusted business architecture advisor as well. All of these create unprecedented opportunities for our partners and resellers to deliver over N50b of Cisco’s best solutions by 2009.

If that is the case, are the resellers in Nigeria prepared to move up from operating in an N8b market to N50b by the third year?
Cisco has gone from an IT to a human company. This change is creating unprecedented opportunities for our partners to step up to the game and move from being traditional product fulfillment companies to delivering solution thereby creating a whole new customer innovation and experience. Our Partners clearly understand this and are preparing their organization’s readiness to address this transformation.

Just how important is Cisco’s distributorship/resellers network in achieving the potential of this market?
Cisco’s primary route to market is through indirect sales, 95 per cent of Cisco’s US$29Billion 2006 revenue was delivered by our resellers and distributors. They are therefore one of the most important elements in achieving the Nigerian market potential you just mentioned

Obviously there will be a lot of reorientation among the resellers, from selling boxes to delivering cutting edge solutions. Can the distributors deliver the training required? What would be Cisco’s role in this?
Definitely, Cisco is working extremely hard with its five authorized distributors for English-speaking West African countries with Nigeria as its headquarters, to ensure solution delivery trainings are delivered within the country. Some of these trainings will either be delivered free or subsidized by Cisco.

What is the impact of the gray market and how easy is it for grey activities impacting negatively on the resellers market?
Grey market product is, by definition, product that is not sold through legitimate Cisco authorized sales channels. In Nigeria, through consistent customer education by Cisco, our authorized resellers and distributors, we have seen a major decline in Gray market activities. This therefore has a negligible impact on the current or future revenue of our dedicated partners.

To maintain the highest possible standards of product quality and reliability and to ensure that customers' service and support requirements are met, we consistently encourage our Nigerian customers to only purchase from legitimate resellers and distribution channels.

Key to growing confidence in this market is the speed and accuracy by which original Cisco solutions can be differentiated from those sourced from the grey market. Is the market big enough to warrant Cisco setting up a Product Testing Centre in Nigeria?
As there are no testing centers in Nigeria, Cisco has simplified the process for our valued customers by simply sending the product serial numbers to the Cisco office in Lagos for immediate product source verification and authenticity

How does Cisco plan to sustain this transformational growth and leadership?
Our networking solutions and software are rapidly becoming the platform for how our customers create business models and new forms of communication-based services to their customers, employees and citizens. The strategy of putting more intelligence into the network, which we adopted over the last five years, was in anticipation of this market transition and growth.

If all forms of communications and IT move into the network as we predict, and the delivery of these services is transparent, customers' expectations will continue to rise rapidly. Today's customers want increased control over everything, and rather than see this as an imposition, innovative organizations, such as Cisco, recognize this change as a huge opportunity.

We design and sell the routers and switches on either end of the network that make it all happen, quickly and securely. In short, the network has evolved from the plumbing of the Internet – providing connectivity to hundreds of millions – to the platform that enables how people experience life.

We have seen an upbeat in Cisco’s activities and presence in Nigeria. Just how significant is this market to Cisco?
Nigeria is extremely important to Cisco. It represents 30 per cent of our Sub-Saharan African business (excluding South Africa), hence the decision to appoint a General Manager and open a full Cisco standard office in the country. The combined business of our top partners also represents a significant percentage in our African business and will be for sometime.

Does Cisco have any social development programmes in Nigeria?
Yes, we do indeed. First of all we are a very active participant in the NEPAD initiative. We supply network solutions to the schools and educational institutions that have been targeted in the NEPAD initiative.

We also have Cisco Networking Academies in which Cisco provides free laboratory equipment and a curriculum to local institutions like Universities and in collaboration with local training partners, young students are offered networking training. These trainings lead to the acquisitions of skills in networking and programming. We have about 35 Networking Academies in Nigeria with plans underway to set up at least 100 before the end of the year.

An essential part of the plan is the partnership between the Federal Ministry of Education and Cisco on the NetAcademies. Under this plan, 20,000 unemployed university graduates will be trained in the NetAcademies at no cost to the beneficiaries. This is aimed, on the one hand at giving the requisite skills to unemployed graduates to make them employable globally. And on the other hand, these skilled graduates will be filling the huge IT skill gap in Nigeria.

We also have the Cisco charity program, which donates to selected beneficiaries.

What do you hope to get out of investing in Nigeria?
For Cisco, continued investment in Nigeria is imperative. With Internet penetration at less than one per cent in Africa, infrastructure build-out will ultimately result in transformational growth for ICT companies in a few years. It is therefore imperative that we work at the highest levels as well as the local levels of government to drive ICT opportunities.

Strong examples are already in place in Ethiopia, Cameroon and Mozambique. More importantly, deregulation and tremendous growth for broadband build-out makes opportunity in the service provider area consistently high across the entire African continent.

What are your future plans for Nigeria and the rest of Africa?
Our future plans are primarily driven by the customer demand.

We will therefore focus on providing Next Generation Networks to service providers which will enable them to reduce costs, improve quality of service and allow them to be more competitive in offering value add services on their infrastructures.

In the public sector we will continue of focus on e-education, e-government- e-health and e-agriculture network roll-out

In the private sector and SME (small and medium scale enterprises), we will continue to focus on the huge IP telephony success and providing corporations the best interconnectivity possible.
In the Oil and Gas sector through partnership with service companies like Schlumberger, we will drive our value add to Exploration Managers saving them millions of dollars in drilling downtime, effectively helping them bridge digital divide between rigs and headquarters.

And of course, hiring of top local skills in Nigeria and Africa to help deliver solutions that will lead to businesses achieving their profitability objective.

Ends

Find out more about Cisco on www.cisco.com
Contact
Owen Nwelih
Marketing Manager
Cisco
3rd Floor - Africa Re Building
Karimu Kotun Street
Victoria Island
Lagos
onwelih@cisco.com
Tel: +234 1 4621000
Press Release issued by XLR8 on behalf of Cisco. Contact Adewole Ojo, +234 802 336 4732. Email, adewole@xlr8.com.ng