Robbins: Cisco and partners navigating business model transition

Chuck Robbins, CEO of Cisco, at Cisco Partner Summit Digital

Cisco and its partners have a history of finding their way through technical shifts. But now, Cisco CEO Chuck Robbins says, the company and its partners are in the middle of a business model shift.

Robbins made the comments in a keynote kicking off the company’s virtual version of its Partner Summit Wednesday. The very fact that nearly 20,000 Cisco partners are getting together over the Internet this week instead of 10,000 or so gathering in Las Vegas would seem to serve as evidence of the executive’s business model shift thesis.

“Historically, we’ve gone through a lot of transitions with our partners — but a lot of them have been technology transitions,” Robbins said, pointing out the addition of voice and then video to the network, the move to selling by architectures, the addition of compute to the network stack, and more. 

“But now, we’re going through a significant business model shift, we’re going to have to think differently about how we’re going to co-exist and deliver value to customers,” Robbins said, suggesting this would be a challenge for Cisco and partners alike, and that no doubt there will be bumps along the way. “But we’ll figure it out.”

The business model transitions — towards trends like applications as the centrepiece of business technology priorities, running on a variety of infrastructure options both on-premise and in the cloud, with security at every point as a key factor — may have been accelerated and shaped by the reaction to the COVID-19 pandemic, but they are forces that have been central to Cisco’s broader transition over the last five years. 

“I don’t think any of us are going to wish this year stays with us any long that it has to,” Robbins said. 

Robbins described “a great deal of change for both customers and Cisco itself” with first the rapid shift to work-from-home, then focus on business resilience, and then a move towards embracing agility.

“Industries have fundamentally changed forever,” Robbins said, providing examples of the changes thrust upon healthcare and education. 

Those changes arrived right in the middle of Cisco’s own evolution, as it has focused more and more on software, services, and other drivers of recurring revenues, with a wrapper of services on top driving customer engagement and experience.

“More and more of our technologies is being delivered as a service,” Robbins said, while noting  that partners were, of course, quite used to delivering services around Cisco’s offerings. But in many cases, the nature of those services is changing, and expanding. Robbins said that with APIs at the core of everything Cisco does, there are more opportunities for partners to build their own offerings on top of Cisco’s infrastructure.

“We all have to accelerate the innovation we’re delivering,” he said. “We’ve expanded our innovation to allows you to deliver that innovation.”

Robbins said Cisco’s priorities are building “an app experience in a cloud-first world,” delivering its core networking as a service (either consumption-based pricing or pure cloud service), and building in automation and security.

But underneath it all, Robbins’ biggest ask of partners is that they help customers get the most out of what they’ve bought, and invest in building customer success. Global channel chief Oliver Tuszik underlined the point, noting that in the past, Cisco products were often bought for their feature sets, but under-utilized because getting those features up and running was too difficult. Cisco, he said, was working on making everything much simpler. But at the same time, he called on channel partners to help customers get the most out of what they currently had as a key first step in getting renewals and ultimately up-selling.

“Build an adoption practice,” Robbins urged partners. “It’s going to be super-important, and it’s going to be one of the big values partners are going to bring to customers.”

While Robbins wasn’t able to present his vision in person this year, he put a point under the fact that he was doing his presentation live, quipping that he might be one of the last senior executives to do keynotes live in 2020, when virtual events have tended to spawn more highly produced (in advance) presentations from senior executives. But this being 2020, Robbins joked, perhaps a bit on the nose, he’d be concerned that if he recorded his presentation one day, the world might have changed enough to make point moot by the time it airs.

While it was no doubt meant as an expression of support for a year that many have described as a very long decade, he’s also seen it happen in person. In June, the company decided to push the date of its Cisco Live virtual event back by a week as it was slated to happen as the protests to the killing of George Floyd in Minneapolis were reaching their zenith.

Robert Dutt

Robert Dutt is the founder and head blogger at ChannelBuzz.ca. He has been covering the Canadian solution provider channel community for a variety of publications and Web sites since 1997. 

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