Examining Cisco's approach to the Australian channel
- 16 March, 2017 10:00
Jason Brouwers - Partner Business Group Director A/NZ, Cisco
“It’s not a conversation about Cisco, it’s about our partners.”
That was the message from Cisco Australia and New Zealand Partner Business Group Director, Jason Brouwers, following partner conversations at Cisco Live ’17 conference in Melbourne.
Brouwers told ARN that the vendor’s approach to the market is centred around adopting a customer-centric view, in that the partner is its customer.
“Profitability is one of the key messages for Cisco," he explained. "For us, this is about the way we think about our partners and the way we do business with them.
“We need to find out how they operate, how they make money. What more of the business do they want to focus on? How do they want to grow? What are the aspirations around business?
"The conversations need to be outcome focused, like those we have with customers.”
Despite Cisco's stance, channel feedback still demonstrates the ongoing value in vendor's acknowledging partners as partners, rather than customers.
“[Cisco] has got to start to see us as a service provider, rather than a customer," Harbour IT General Manager of Cloud Services, Adam Simpson, told ARN.
"So, it’s about improving engagement and Cisco’s starting to acknowledge the SMB service provider market."
Both locally and globally, the networking giant has been negotiating a huge turnaround both internally and externally, as it shifts its focus to new and emerging technologies.
In moving away from its core legacy business, Cisco is chasing after software growth.
Like most in the industry, the result means a change in market approach, through leveraging advancements in cloud, alongside security and technologies it calls the “sizzle of digitisation”.
“When it comes to disruption, many of them are worried about what their future looks like, what they need to do to adjust," Brouwers explained. "But what might seem as a threat could be a positive outcome.
"We can’t always rely on what we’ve done in the past, we’ve got to look to the future.”
Nutanix Vice President of Channels, Christopher Morgan, acknowledged that all legacy vendors, including Cisco, remain challenged when it comes to moving towards software.
"They would have put some things in hardware, and some things in software," he said.
"That makes it really difficult for them to change their go-to-market. They have a top line revenue number, that they report to Wall Street, that includes reselling commodity hardware.
"It's hard for these companies to untangle from and there will always be that dependency on hardware because architectrually, it is very difficult to do true cloud solutions from a three-tier starting point.
"From VMware, to IBM, to pick your favourite, they all can't deliver a true enterprise cloud experience - it's because of this complexity."
From a Cisco perspective, Brouwers said that during partner conversations across Australia, the channel remains challenged in terms of tapping into profitability growth areas.
"They put the challenge back to us saying, you’re making the networks simpler and providing other things like automation and that’s a challenge for them because they make their money from services around those networks," he added.
"But, we see that as a positive thing as they can then take the message back to their customers and focus on additional advanced capabilities like applications or analytics."
In looking through the lens of the partner, Datacom Associate Director of Transformation and Enablement, Mark Hile, acknowledged that Cisco’s increasing move into the 'as-a-service' space will impact the channel, especially the traditional channel partners that gain value out of wrapping services around solutions.
However, Hile said the move is a result of market needs and wants, and the channel should evolve to make way for such changes.
"This will impact the channel," he said. "It’s transition that is the most difficult part – changing from the traditional monthly sales model to a utility-based model – and forecasting can be difficult with no minimum commit. It changes things a lot."
According to Brouwers, the approach is to build partners for the future, continuing the development of its current partners in growing their practices around things like cloud, analytics, IoT, and security, and onboarding new partners in these new verticals.
"These are some areas we need to get some new partners on board and connect them with our traditional partners that don’t have that background,” he added.
One such example is service provider, R1i Services.
The Perth-based company has been a partner of Cisco’s since 2010, with a focus on data centre, network, and communication, but has developed a recent focus on security.
R1i Services Security Practice Director, Sean Thomson, said security underpins everything and it is now part of the company’s evolution.
“The 'fear factor' no longer plays a major part in the sell, as everyone now knows about the implications of security breaches… and for us, it’s not about box dropping," he said.
"We want to stay engaged with our customers to make sure that the investment is realised over the lifecycle of the asset."
In addition, Brouwers also added that going forward, plans are in place to create “symbiotic relationships” between Cisco and its partners, enabling the joint success of the companies.
"We want to actively help our partners around capabilities," he added. "Some are ready for disruption, some aren’t.
"Majority are in the middle but for the long-term, they need to consider these other things to transition to with technology advances."