December 21, 2014

Is Cisco Becoming more MSP-Friendly?

msp-friendlyManaged service providers who haven’t given Cisco Systems a recent look may want to take some time to re-evaluate the networking vendor. Some recent moves – both at last week’s annual global Partner Summit in San Diego and predating it – seem to suggest the company is looking to get much more closer to MSPs – and to help solution providers not offering managed services at least to dip their toe in the water.

Let’s start with one of the biggest potential changes for managed service providers: the company announced a rather radical simplification of its services partner programs. How radical? Well, from the hodge-podge of some 47 partner programs that concerned services, Cisco is going down to one – the new Cisco Services Partner Program.

In other words, fairly diverse MSPs will go from having to manage a large selection of obscure service programs – one for managed services, one for professional services, one for integration services, one for services delivered on Catalyst switches on the second Tuesday of the month ending in y, etc. – to one program.

Already in a massive pilot with some 4,000 Cisco partners around the world, Cisco notes that participating partners saw a 15 per cent increase in the portion of their bookings eligible for rebates as a result of a new, uniform rebate compensation model.

The company also announced plans to share its Smart Services portfolio with partners. Smart Services are a bunch of Cisco intellectual capital that aim to embed some network-based “smarts” in services. One of the major goals of Smart Service is automation of previously manual network administration and management tasks – a subject near and dear to many an MSP’s heart.

And on the subject of getting closer to MSPs, let’s take a step back a few months now to late last year, when Cisco introduced OnPlus, a service based around a network appliance for remote management. At its simplest, it appears to be an easier way for managed service providers to get hooks into a Cisco-based network and manage and automate from there. But chatting with Cisco, you get the impression they have much bigger goals for it.

Specifically, they see an opportunity for just about every partner type. And, put in its simplest terms, that opportunity boils down to “getting into managed services.” The pitch seems to be this – partners buy OnPlus devices from their distributor of choice, install it on their customers’ networks an build their own remote monitoring and management practice around it – billed in monthly recurring revenues for management services, with everything automatically measurable and meterable.

In other words, it’s an olive branch to solution providers who haven’t yet figured out this whole managed services thing – a very rudimentary “managed services in a box” kit, if you will. But there’s the potential for OnPlus to get very interesting in the future – already there have been whispered hints that the current generation OnPlus remote monitoring box is just the first in a family of products that aims to ease and automate managed services for Cisco partners. If there turns out to be reality behind these whispers, things could get very interesting.

Lastly, a “watch this space” kind of note. Everyone who knows Cisco knows that it loves to measure things, and most of the company’s partners know that those measurements include partners’ overall profitability with Cisco – a figure that the company reckons converts into partners’ overall “return on Cisco.” But at Partner Summit, global channel chief Edison Peres seemed to suggest a new type of measurement was going to start. Not only will Cisco keep track of the effect its pricing and programs have on partner profitability, the company will start eyeing what impact it has on partners’ business valuation. Nowhere could this be more impactful than in the acquisition-ready field of managed services companies.

The exact measurements Cisco is going to take here aren’t entirely clear as of yet. And how those measurements are going to impact specific partner programs or actions is also not entirely clear yet. But it is interesting to not that Peres suggests that all future partnering decisions will be viewed through this valuation lens. If done right – and the company has a good record of executing on such shifts in partner measurement dating back to its decision a decade ago to base its partner programs around specialization and value-add rather than volume of gear sold – it could be a major shift in the long-term focus of the company’s program, and one for the better.

So what’s your opinion of Cisco as an MSP-friendly company? What else can the networking giant do to make your business easier and more profitable?

Robert Dutt About Robert Dutt

Robert Dutt is a veteran IT Journalist and Blogger. He covers the Canadian IT technology solution provider scene at ChannelBuzz.ca. You can also find him on Twitter.