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After 'Brutal & Honest' Inventory, Cisco Slashes Number of Partner Programs, Streamlines Incentives

At Cisco Partner Summit 2017 in Dallas, Texas, this week, the networking giant announced radical changes to its specialization and incentive programs in an attempt to give partners a simpler experience. But getting there wasn't easy.

When Wendy Bahr, Senior Vice President of Cisco’s Global Partner Organization, first assumed her role two years ago, she did so with a clear mandate from Cisco’s partner community: for Pete’s sake, make the programs simpler.

This is a sentiment numerous channel chiefs have echoed to Channel Futures in recent months. Many vendor programs, built on the back of a hardware-based ecosystem that no longer exists, are redundant, complex, and frustrating for partners to navigate. The partner program changes Cisco announced this week at its Partner Summit 2017 are welcome news to partners, but they weren’t easy to execute.

For a company as giant as Cisco, with more channel plays than you can count on your fingers and toes and a partner ecosystem that stretches back to a time when hardware was still king, ‘simplifying’ its programs was a lot easier said than done. Bahr knew that she needed to do more than reduce the number of programs and streamline the partner experience. She also had to build a program that was flexible and resilient enough to accommodate a future channel that no one can predict, where partner types, business models, and emerging technologies have yet to solidify.

So how to even begin? Bahr told Channel Futures it was a bit like looking at a growing pile of laundry in the corner that you just don’t let yourself think about because it feels like too big of a task to even start.

“But at some point, you either have to fold it or wash it,” she says. “You know it has to be done.”

Bahr started by taking “brutal and honest inventory” of all of Cisco’s portfolio programs and immediately killing redundancies. She merged similar programs together and tweaked them to suit the needs of different partner plays within each offering. If someone had an idea for a new program, that was great—but they’d better be able to fit it into something Cisco already offered so the partner wouldn’t have to spend even more time and resources learning something new. Cisco’s portfolio is so broad and the requirements of the customer are so business critical, she needed to make the programs as simple as possible.

This week’s announcements are evidence of Bahr’s and Cisco’s efforts toward that goal. Cisco has maintained its commitment to being a value-oriented channel and viewing specializations as critical, but it’s reduced the number of specializations it offers from 27 to 11 all told.

Its 10 entry-level Express specializations are now one consolidated trek geared toward educating new partners in the foundations of Cisco technologies like networking and security. This move was critical to attract and retain what Cisco calls ‘ecosystem’ partners such as digital agencies, boutique security and services providers, and digital solution integrators. Bahr says these partners need a different value exchange from Cisco, such as ways to scale.

The company also reduced its midtier Advanced specializations from 13 to five, now called Advanced Architecture Specializations, and added a Master Networking Specialization that covers software, security, programmability, analytics, and automation and reflects Cisco’s commitment to intent-based networking. That specialization will be available in March.

Bahr also tackled simplifying deal registration, reducing the 15 different programs and incentives down to two, and added a new VIP Annuity program that gives upfront rebates to partners when they secure, expand, or renew a SaaS deal for a security, collaboration, data center, or enterprise networking sale.

But wait! There’s more! In an effort to get partners not to just land a deal but to get the software turned on, Cisco announced a new VIP Activation giving additional back-end rebates on Cisco ONE, Digital Network Architecture (DNA), Identity Services Engines (ISE), and Stealthwatch deployments.

Finally, there’s the new Cisco Migration Incentive Program (MIP) that gives an incremental discount on qualifying hardware, software, and services migration opportunities. The goal here is to incentivize Cisco’s existing install base to begin integrating emerging technologies into the solutions they sell.

This is all in an attempt to wrangle the ‘new’ channel. On one end, traditional partners are evolving from close-to-the-box, hardware systems integration into truly integrating multiclouds, software, security, and business process change.

On the other, Cisco’s ‘ecosystem’ partners are searching for ways to scale and grow their unique digital solutions. Bahr says these partners have different needs and want a different value exchange from Cisco.

“We call it customer end-selling. It allows us to embrace and learn from [ecosystem partners], and we can share our experiences in how they’re going to need to continue to develop in order to grow. Many of them are small, so we ask them questions about what it might look like two years from now when their business is broader—broader in geography, broader in terms of the reach of their portfolio.”

Bahr knows that bringing these two disparate ends of Cisco’s channel together is critical because thinking that any one partner can do it all is quite the stretch. It’s the entire reason Cisco’s Partner Ecosystem connection events exist, to bring traditional partners together with their newer, born-in-the-cloud counterparts in order to craft specialized solutions for end customers. Cisco made 2600 of those connections in the last year across 15 vertical industries, creating more than $4 billion in revenue—and Bahr says they’re just scratching the surface.

 

 

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