In an exclusive interaction with CRN India, Daisy Chittilapilly, President – India & SAARC, Cisco, discusses the company’s presence and growth trajectory in India, shedding light on its strategic partnerships and business outlook. She emphasises Cisco’s robust relationship with customers and partners as a key driver of success in the Indian market, highlighting the country’s post-COVID economic rebound as a catalyst for increased tech spending.
Can you discuss Cisco’s business in India and the percentage it contributes to Cisco globally?
While we don’t disclose specific percentages, I can share that India is now a top 10 market for Cisco globally. This marks significant progress from previous years. Given India’s growth rate, and our own growth rate in India, we expect to be in the top 5 within the next few years.
How has been the business growth in the last couple of years?
Post-COVID, India has really rebounded, and the economic growth here means that tech spending in India is strong. We are obviously beneficiaries of this increased tech spending because we’ve been established here for many years. We enjoy a very strong relationship with our customers and partners, which is a significant factor in our success in India.
What percentage of your India business is partner focused?
A large part of Cisco’s business globally—over 80%, 84%, 85%—happens through partners. In India, that figure is upwards of 95%. There are very few services contracts and extremely high-value clients in India, but more than 95-96% of our business is channelled through partners.
In what ways Cisco is helping its partners pursue new business opportunities and accelerate growth?
Our portfolio is very broad, and we act as an acquisition agent. Each time we acquire a new company or expand through innovation, whether internally or through our partners, we follow our innovation model. This model involves continuously building, buying, and expanding our portfolio. As we grow, we must enable our channel partners to keep pace, ensuring they are up to speed. We serve as the spokespeople in the market, maintaining ongoing conversations.
In addition to training, we offer certifications that provide specialisations and differentiation among partners. We have a series of specialisations based on architecture or product family groups, which supports our enablement efforts.
On the incentive side, we have long maintained one of the most profitable program systems for partners. We continually modify it for two main reasons: to stay current with our portfolio and to meet the profitability and relevancy requirements of our partners. These updates also reflect the changes in our portfolio and accommodate the different types of partners we have, such as resale partners, system integrators, and distributors.
Now, we also include managed services partners like telecom, service provider cloud partners, partners who transact with us on marketplaces, consulting partners, and influencer partners. Our programs are evolving to keep up with the new emerging partner types and roles. Both partner types and the multiple roles a single partner might play need to be considered. Our programs must remain current and relevant with the evolving channel and partner landscape.
Do you classify your partners?
Yes, we have different levels of certification, including the premier section. These classifications are on one side. On the other side, we have cloud service providers, managed service providers, and influencers. There are other classifications of partners as well. Additionally, we have specialisation partners based on technology specialisations, such as security, data centre, or collaboration centre. A partner can fall into any or all of these categories, or various combinations thereof.
Since you have been the Director of Digital Transformation previously, how do you see the role of partners evolving in the digital disruption era?
One of the things that has always been prevalent in tech is that traditionally, the calling universe in India falls under facilities management rather than the CIO. Voice communication is considered a facility. This is not unique to just collaboration tools. For example, when we conduct conferences or enable formats like whiteboarding or webinars, our buyer is often the L&D department or the HR department of the company.
This is not unique to WebEx. The buyer ecosystem is not solely focused on CIOs. This is true in the world that Cisco operates in today, as well as for many other companies. Technology is enabling business outcomes for enterprises. Therefore, partners need to upskill themselves to cover the tech conversation with CIOs and differentiate themselves by delivering business outcomes that are materially important and differentiating for both customers and partners.
This involves not just domain expertise but also intellectual property (IP) coverage. One of the great things about the partnership we announced today is that we are bringing together WebEx Calling, which is our IP, and Global Repeat, which is Tata Communications’ IP, to create a market differentiator.
Our portfolios, especially as we transition to a more SaaS and software-focused world, and an API-first world, are providing partners with the ability to create their own IP on top of our platforms. We are transitioning our portfolio to a platform-based approach. WebEx is our collaboration platform, and we also have a security cloud, a networking cloud, and observability platforms. These platforms are built with an API-first approach, allowing partners to create their own IP and develop much more powerful solutions and conversations.
Do you offer these as full-stack services, including cloud and security?
Yes, as a full stack. And partners now have, as we have moved to software platforms, partners’ ability to create their own IP and deliver more meaningful outcomes and use cases to customers is actually on the road. So that is a transition a partner has to make, right, from being a reseller or a system integrator. This is an option for a partner who wants to differentiate themselves. So I think this is the world we are going to. And then, of course, when you move from hardware resale to software subscriptions, the shift for a partner is also how do they redo commercially, how do they redo their P&L to prepare for a lifecycle.
Because earlier you used to sell a product, implement it and move. Whereas now what customers want and what you will do and want to do is that you will help a customer extract value from what they are deploying over the lifecycle of that technology. Which means you are moving from a resale organisation and a resale P&L to a lifecycle P&L and a lifecycle organisation, which is a very different way of thinking about it, right?
Moving from resale to subscriptions and annuities and remaking your P&L in that model. That’s another shift. So those are the two or three important things that are happening. And my very success, like I said at the beginning of Cisco, is that any transition we make, we are ably supported by our partners. So they are also on this journey with us.
Are you encouraging your partners to utilise AI or GenAI in their operations?
Yes. For example, one of the topics we discussed was AI, and now we’re in the context of WebEx. However, if we were to draw a parallel to one of the most intricate technologies the world is grappling with presently, it’s cyber security. Within cyber security, there’s an escalating threat surface and an expanding array of attackers, coupled with a scarcity of skills or a diversity of skills at the requisite level. We’ve developed an equivalent of the WebEx assistant for our firewalls, known as the firewall assistant.
The firewall assistant serves to streamline the expertise required of a firewall administrator. It simplifies their tasks, notably by automating mundane jobs such as policy implementation and cleanup. Previously, a task might have necessitated the expertise of a firewall administrator with 12 to 20 years of experience, but now, with automation, the skill level required can be reduced. This not only eases the workload but also enhances the efficiency of those involved.
This capability extends to our partners who manage and utilise these products to provide services. They can leverage these capabilities to enhance efficiency within their own teams, thus facilitating smoother operations within the business.
This serves as a straightforward example of how, in networking, we’ve transitioned from the complexities of CLI to more user-friendly GUI-based configurations. This shift towards a more intuitive interface abstracts away complexity, benefiting both those who manage the technology and our partners who serve as intermediaries for the end customers.
In many cases, our partners play a crucial role in providing expertise to customers, particularly in regions where in-house expertise is limited. Thus, AI plays a pivotal role in automating and simplifying tasks, reducing human error, and improving overall efficiency.
What sort of competencies and capabilities do the partners need to build to address customers’ complex digital challenges?
We undergo training regularly. However, in addition to training, we continuously advance our expertise through specialisations and certifications. Therefore, one of our latest certifications is the lifecycle certification. As we transitioned from simply acquiring various technologies and obtaining technology certifications, it became evident that understanding the lifecycle of these technologies is crucial. Hence, we introduced lifecycle certifications to ensure our ongoing evolution. This is just one illustration of the variety of initiatives we undertake.
How do you measure the success of your partners?
Growth is obviously always important. But from a partner point of view, I think relevance in their customer set, their wallet share, their relationship with Cisco is something that we would like to see on a healthy growth trend. And they’re profitable. So we constantly run profitability training sessions with partners, which is essentially telling them where their opportunities to monetise. So I think for us, we always measure our success on how well does the partner grow with us, how relevant do we, as a partnership with Cisco, make our partner in their market, and how healthy is their business with us, how healthy is their Cisco portfolio in terms of our profit and loss. Those three things sound simple, but to get the right balance between them is always hard. But those are the three things we’re always committed to. That a partnership with Cisco should help partners grow, should keep them relevant to their customers, should allow them to target any customer sets that they want to, and should be a profitable business for them.
Considering that the technology has been there in the industry for quite some time now, then why did it take so long to launch WebEx?
The technology has been available for quite some time now. Indian enterprises traditionally conducted meetings encompassing various forms of communication such as chats, audio, and video, all facilitated by on-premise equipment like EPABXs. However, the EPABX world remained somewhat isolated, operating independently from other technological advancements. The onset of the COVID-19 pandemic disrupted this setup, rendering the reliance on on-premise equipment impractical.
Despite a significant return to office in India post-COVID, the reality is that remote participation remains integral to meetings. Therefore, there is a pressing need to integrate on-premise and PSTN calling capabilities to accommodate hybrid work models effectively. This necessity has given rise to a demand for solutions that enable seamless collaboration across different communication channels, marking a significant shift in the landscape of hybrid work environments.
It’s fair to say that the current product offerings are a direct response to the challenges posed by COVID-19. While these products have been available for some time, their relevance and demand have surged, particularly among smaller businesses (SMBs) where cost-effectiveness and ease of use are paramount considerations.
For SMBs, affordability and simplicity are key factors in adopting such solutions. This product bridges the gap, providing SMBs access to enterprise-grade collaboration tools that were previously inaccessible due to their complexity.
But it is expected to be a lot more economical than the previous version. It serves as a middle ground for them. In the previous version, although Indian customers could purchase calling services, they essentially had to establish a private link outside the country, often to Singapore, resulting in higher costs. Naturally, this incurred significant expenses.
So, there’s a commercial advantage for end customers, which we intend to pass on to them through this offer.
Which are the areas your partner should invest to be aligned with Cisco’s direction?
Regarding the life cycle, I’ve already discussed it. Additionally, I’ve mentioned the increasing significance of the software realm. Our recent acquisition of Splunk further solidifies this notion, given its role as a data platform within this context.
Partners with the capability to develop their own intellectual property can effectively distinguish themselves in the market and capitalise on it. Absolutely.
As we further develop our portfolio, it’s crucial to keep it updated and in line with these changes. Not everyone needs to become an API partner, particularly in India, which boasts a large community of software developers. This gives Indian partners a natural advantage in pursuing this direction.
However, if your goal is to remain as a system integrator or at the v7 level, there’s still ample opportunity within our portfolio. The country offers plenty of scope for you to excel in those roles. In such cases, it’s essential to continue specialising in technologies and maintaining your partnership status.
