Era of Collaboration Looms Over Channel
Cisco brings its channel partners together and makes the pitch for them to cooperate with each other in landing and supporting new business. Is this a new trend?
Cisco brought its channel partners together in Honolulu recently, and there was an interesting spin to the usual greeting and dealing that occurs at such events.
Cisco executives made a big push for collaboration, not just between Cisco and its partners, but among the channel partners themselves. As the markets that Cisco enters become more focused and the solutions themselves become more complex, Cisco executives believe there is a lot to be gained by the partners partnering up.
In fact, the company released a global study that showed collaboration among Cisco partners is generating 31 percent of channel revenue and is growing by 15 percent annually. Furthermore, 62 percent of the partners believe that collaboration will continue to grow over the next five years. Cisco partners work with an average of eight other partners on a regular basis, according to the company.
The opportunity is large. Cisco hopes to build more than $15 billion in business for channel partners during the next three years in such areas as SaaS, data center services and unified communications. To help seed this growing collaborative effort, Cisco launched a network called Cisco Partner Exchange. It aims to help channel partners grow revenue, broaden their expertise and deepen their relationships with customers by working together.
This collaboration network is now available to more than 8,500 Cisco Certified Partners, managed-services providers, distribution partners and application partners from all over the world.
Cisco is smart to move in this direction. The global channel study showed that customers desire more expertise from vendor and resellers as solutions become more varied and complex. Channel partners also were found more willing to fill the expertise gaps by partnering with other resellers in a "coopetition" relationship.
According to Cisco, partners who collaborate with others are positioned to deliver more value to customers. Collaboration enables 78 percent of these resellers to win larger projects, 75 percent to acquire new customers, and 74 percent to increase their revenue
Meanwhile, customers say that collaborative resellers reduce the complexity of their IT business solutions. Between 80 and 90 percent of customers globally are satisfied with the collaborative partners' technical, business and industry expertise; the ease of doing business with them; and post-sale service and support, according to the Cisco survey.
Finally, collaboration helps partners differentiate themselves by obtaining more technical expertise and differentiation, as well as greater vertical expertise.
All of this underscores the notion that an era of collaboration is looming over the channel and that partners would be wise to embrace it. The new business opportunites it offers seem to more than compensate for any concern partners may have about sharing customers with each other. Cisco's move appears a bold one, but the company may simply be out in front of a trend other vendors and partners may soon be forced to embrace.
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