News Stay informed about the latest enterprise technology news and product updates.

Expanded Cisco services plan mapped out

At Cisco Partner Summit 2013, the Cisco services team outlines the structure of an expanded services portfolio.

BOSTON -- "Services on steroids." That's how Edzard Overbeek, senior vice president of Cisco services, described the company's vision for its services business portfolio and the opportunity it presents for partners, as he addressed attendees here at Wednesday's Global General Session of the Cisco Partner Summit 2013.

Cisco's services strategy involves an expanded portfolio that moves beyond technology and professional services to conversations about platforms, analytics, industry solutions and consulting fueled by the company's "smart services" portfolio and partner innovation.

"There's a new set of solutions and services out there that will change the industry," said Overbeek.

According to Leslie Rosenberg, research manager for Network Lifecycle Services at IDC, technology initiatives such as mobile, social, cloud and big data -- which collectively IDC terms as the four pillars of the Third Platform -- will begin to drive  transformation within the network consulting and integration services (NCIS) market.

“Cisco has done a good job in opening their own services IP to partners to enable them to evolve toward more high-value services,” she said.

Today, Cisco has 500 active partners in its collaborative smart service known as Partner Support Service (PSS), which to date has generated $550 million in active bookings. PSS was introduced in conjunction with the Cisco Services Partner Program (CSPP).

CSPP is the foundation of Cisco's long-term services strategy. It was introduced a year ago and rolled 47 programs into one. Today, CSPP has 50,000 partners who have generated $200 million in rebates and $6 billion in business. By end of year, when the worldwide rollout of CSPP is complete, Cisco expects to have about 63,000 partners in the program.

According to Raja Sundaram, vice president of services partners and commercial at Cisco, today 80 percent of the company's service engagements go through the channel with partners playing one of two roles: as resellers of Cisco services or as consumers of Cisco services, where they add value around the services and deliver their brand to the marketplace. The latter role – which is higher-margin and higher-value than the former -- is also called collaborative service.

Get more resources on Cisco's services

Learn more about Cisco's Smart Services and its open APIs

Get more information about Cisco's cloud and managed services programs

Read about Cisco's European networking services strategy

The company's smart-enabled service is based on a strategy that adds software components to services to identify, for example, what devices are in the network; what's covered or uncovered; whether the devices are at end of life; or whether they have security vulnerabilities.

Cisco has also rendered smart capability in professional services to automate business processes, such as an audit function to identify network readiness for voice, which would enable partners to provide such services in less time with fewer engineering resources compared with a manual audit.

To help qualified partners move into professional services, Cisco has something  called Collaborative Professional Services, a collection of three distinct services for partners. It aims to help partners stand up a new practice; use automation tools or smart services, and offer back-end support for partners to ensure customer engagement success.

Black Box Network Services, a Cisco Gold Partner, CSPP and $1 billion business communication specialist located in Lawrence, Pa., is poised to qualify for Cisco's PSS. "The smart services will not only be beneficial to our customers but will differentiate us among our competitors," said Peter Marquis, vice president at Black Box.

Marquis is a firm believer that companies that don't seize service opportunities won't survive. "We're comfortable with services and what we're doing, but we have to continue to stay in front of it," he said.

Technology and professional services are just the beginning of Cisco's vision for smart services. Overbeek suggested three new categories of services: platform services, industry services and, consulting services in four main domains -- unified APIs, energy management, analytics and security.

So why are Cisco smart services critical?

"It's critical because it brings automated processes with deep insights into the network that will help bring customers to a state where the network really becomes the platform. It increases in satisfaction for the customer because the network is always on; it's resilient and agile," said Overbeek. 

In an effort to "double down" on helping partners adopt smart services, the Cisco executive announced a Smart Acceleration Promotion for six months beginning in Q1 FY14. The promotion includes a market development fund (MDF) and rebate incentive under CSPP.

The total worldwide enterprise NCIS market accounted for $26.8 billion in revenue for 2012, growing at 5.6% over 2011, and is expected to reach $28.8 billion in 2013, according to IDC's WW and US Enterprise Network Consulting and Integration Services Forecast 2011-2017. The network continues to remain core to IT strategy, and IDC believes networking along with the attendant NCIS will keep pace with overall IT spending as network-based initiatives rise in importance. Additionally, IDC believes NCIS, which is intimately tied to enterprise network infrastructure growth, will grow to $37.3 billion by 2017, with a CAGR of 6.8%.  

Rosenberg said that Cisco Services, which represents about 20% of the company's revenues, is closely followed by many of its top partners, such IBM, AT&T, Dimension Data etc.

Is Cisco’s services strategy on the right track for partners? The IDC analyst seems to think so.

“As they continue to grow and invest in services, they need to be clear that they will not compete with their best partners who are well established in this space. Also, they need to continue clear messaging, [and] provide training and enablement resources to help their partners transition into services,” Rosenberg said. 

Dig Deeper on Channel partner program news

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.