Cisco’s “Shift to Software” has become ubiquitous among its portfolio and programs. In this article, TD SYNNEX continues its series on how channel partners can make the transition along with Cisco. To discuss all things Cisco software, EDGE360 recently sat down with Joe Vlajcic, Director of Cisco Customer Experience at TD SYNNEX. He shared some insight into Cisco channel programs and how new incentives reward partners making the transition to software.
Note: This post is part of a several-part series on “Next Generation VAR,” provided by the TD SYNNEX Cisco CX Team.
Continuing the TD SYNNEX series on Cisco software, Vlajcic discusses how Cisco partners can increase their profitability as they drive more Cisco recurring revenue. In previous posts, Vlajcic discussed the market changes happening with Cisco EA 3.0 and how companies can position themselves as the go-to partner for Cisco subscriptions. In this article, he describes the changes in Cisco incentives and how partners can take advantage of them.
“Cisco incentive programs are a hot topic within the partner community,” Vlajcic explains. “They’ve changed significantly in the last few years and, to those of us who knew the old legacy programs, that can be dramatic.”
Vlajcic goes on to describe some of the largest current programs, the Value Incentive Program (VIP), the Cisco Services Partner Program (CSPP), and the Lifecycle Incentive Program (LCI). “Each plays a part in the sales cycle and incents a certain partner behavior. I talk to a lot of channel partners who get a little fatigued at the complexity. There are more ‘pots of money’ out there than ever and each program has its own guidelines, its own SKUs, and its own operational processes,” Vlajcic said.
A large mosaic of programs certainly exists, but Vlajcic says the complexity doesn’t have to lead to confusion. “If you look at all the documentation – and believe me, we’ve read every word of it at TD SYNNEX – you start to see the same messages permutating. If you can separate the signal from the noise, it becomes a straight-forward process to manage.”
Vlajcic goes on to explain his view of the program landscape. “To some extent, all the programs incent the same basic behavior: annuitization of the Cisco portfolio. VIP, CSPP, LCI – all of them are going to provide larger rebates for subscriptions and the things that make subscriptions stickier in accounts. VIP provides software payouts in all three tracks, CSPP gives kickers for Success Tracks (adoption services) and LCI pays for software outcomes. Even the new Solution Specializations provide bonuses for subscription software. You don’t need to memorize thousands of SKUs or read every word of the Operations Guide – the message they’re sending is very clear!”
While the number of dollars in the Cisco channel program has risen in recent years, partners have struggled figuring out how to access them. New compliance, like the CX or Solution Specializations, can create an impression of a moving target for partners. “That’s a common perception but one that I don’t think is accurate,” Vlajcic said. “The SKUs do change from program term to program term, but I think Cisco has been remarkably consistent in what they incent.
“Take something like the Data Center portfolio, which I think is a good example: selling servers is a big part of a lot of resale business. The rewards are always going to be there for migrating a customer to the latest model – that requires some awareness of the product space. The big difference, however, comes in a bare metal environment versus something like an Intersight deployment. Adding a subscription, tacking on a success track, driving adoption and outcome – you’re talking a lot of incentives that stack together at that point,” Vlajcic described.
Admitting that not all the incentive actions are easy motions, Vlajcic says that bigger rewards come from better aligned deals. “It’s upsell, for sure, in a lot of cases, but not gratuitously so. There’s a lot of functionality that Cisco has that customers are not aware of. The incentives are there for partners who may slow down the sale a bit and ask to show something else related instead.
Vlajcic left the conversation with one more example that illustrates the divergent paths a Cisco sale can take. “One of the things that happened a lot in the pandemic was, in those early, crazy days, IT organizations were rushing to expand their VPNs. Everyone was divesting their office locations, and nobody had built a VPN to handle that kind of rapid increase in usage.”
A lot of pre-sales organizations got that call and, looking at the portfolio said, “VPN capacity? That’s a pallet of ASAs – here they come!” The ASA is a great platform, but eighteen months later you have users asking if they should spend a little more and move to something with more capabilities. “It’s a bigger lift to ask a customer (especially one in panic mode) to think through options, but the incentives are there to defer those costs for the partner,” Vlajcic described.
A lot of work goes into harmonizing vendor incentives and profitability, with many partners employing full time Alliance Managers to that effect. Vlajcic ends his interview with an offer for all TD SYNNEX partners. “If the above hasn’t been your experience – if you’re struggling to make sense of the programs or could just use the benefit of some best practices – please reach out and talk to the Cisco CX team at TD SYNNEX. We would love to help you get every penny of your share!”
Want to learn more? Contact TD SYNNEX at CiscoCX@tdsynnex.com to learn more about how we help partners align with Cisco’s shift to software!
