Cisco embraces distribution

Cisco embraces distribution

Recent changes to Cisco's channel management structure will see a greater emphasis on distribution rather than single-tier reselling.

According to Cisco's operations manager, Steve Hill, the changes are also tied into a streamlining of the Cisco product set, with the combination of its traditional enterprise and Cisco Pro categories.

"We made a decision a couple of months ago to move from what was really two channel structures to rolling it up into one channel organisation with one philosophy about how we went to market," said Hill.

"The next phase is to continue to drive more business through the channel, and also to continue putting more fulfilment through the distributors."

Hill says the decision was taken because the number of small orders going through the warehouse was choking resources. He feels that dis-tributors have most of these functions as a core competency.

"Ultimately it will mean winding back our own warehouse," said Hill, "but not in the short term, because we still do have a discreet part of our business that we sell direct to." Industry sources indicate that the date will be near the middle of this year.

To make this happen Cisco is winding back the number of Gold level integrators it deals with directly, from around 30 to a figure closer to 10. The remainder will work through Cisco's distributors.

"Clearly running two discrete channels wasn't working," said Hill.

"So we've rolled the channel up, and that coincided with similar (to the enterprise) product sets being available through the channel." Indeed, the two product sets have been integrated into one, and made more compliant with the needs of distribution.

At the same time Hill says he took the opportunity to make sure that the resources in the channel area were correctly focused. "So the channel managers who were previously in the two-tier end of the business reported to (distribution sales manager) Liz Lawson, and in the enterprise end of the business reported to (national channels manager) Peter Papaioannou, are all going directly to me."

Hill says Lawson will now be focused more on managing the distributors rather than her previously dual focus that encompassed the Cisco Pro resellers.

Papaioannou has been moved to the position of channels development manager, said Hill. "He'll be focused on working with the channel, providing Cisco product sales training, and competitive product sales training.

"So clearly he's a valuable resource to be used in a proactive manner, rather than in the fire hose deal-by-deal manner.

"Peter will be there planning the programs to help develop the skills within our channel partners, and that's at all levels - the Gold, the Silver, and the Premier certified partners - to increase their skills, their knowledge of Cisco product, and of how to sell Cisco product."

Hill says the changes are crucial if all parts of the Cisco channel are to tell the same story. "When our channel partners are talking to an end user and they're doing the Cisco pitch, I want it to be a story consistent with the one the Cisco account manager is delivering to an end user. And clearly they have to understand when they are selling Cisco product into our end users that they are competing against Cisco's com- petitors, but when they are selling the value-add and their services and the integration capabili-ties then they are competing against the other integrators.

"What I want to do is help give them the skills to be able to deliver Cisco. And out of that we'll work with them and run workshops with our channel partners to help them understand how to sell their value-add wrapped around the Cisco product, and what the opportunities are."

Out of the Australian picture now is former managing director Scott Ferguson, who has taken on the role of director of channels for Cisco's emerging Asian market.

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