Cisco is focusing on specialization and certification, not on volume-based discounts

An industry veteran with over 13 years of experience in the IT sector, Jangoo Dalal, VP, Channels and Business Development for India and SAARC, has been instrumental in Cisco's undisputed leadership in the router market. Prior to joining Cisco four years back, this MBA degree holder was with Wipro, managing diverse areas like sales, channels, support and business development. He tells DQCI about Cisco's present and future strategies to retain leadership in the market.

Some believe that Cisco’s near monopoly in router market is only because of its first mover advantage. What is

your opinion?

Cisco is the leader in the router market, globally as well as in India. The company invented routing and has been at the forefront of driving innovation in this space for the last 15 years.

The secret of this impregnable lead is not based on merely having the so-called "first mover advantage". Our advantage comes out of not only having the best products, but also from the relentless customer focus and constant R&D to develop a faster and better product.

What are your strategies to retain leadership in India?

We firmly believe that every company needs to be equipped with specific skills and tools to be successful in the Internet economy. We do 100 percent of our business via partners. We have more than 1,200 authorized resellers, who are present in more than 100 cities. These resellers deliver the necessary solutions to consumers. To address some of the more complex requirements, we have premier resellers who are capable of providing the highest levels of sales and post-sale support to the end-user.

Cisco has had unprecedented success in the channel space basically because we understand how critical it is to invest in the training and development of resellers. Intensive workshops are conducted to impart technological skills to channel partners, enabling them to deliver value to their customers. Cisco understands that it is this close-working relationship that will ensure its continued success in the SME space.

IDC figures show a two percent drop in Cisco's market share as against the three figure growth over the last few years. Do you think that you are losing out to other market players?

As per Voice & Data, the router market in India is estimated to have grown at a rate of 86 percent in the last financial year, and Cisco claimed 85 percent of that market. Also, Cisco has consistently been a global leader in the router market with around 80 to 90 percent market share.

There have been year-on-year fluctuations in the market share in the past decade. But that has never impacted Cisco’s stature as the premier router company in the world. What is more important, is the fact that we have been able to maintain a consistent market share even in such a high-growth, research-intensive and customer-sensitive segment.

You have doubled the number of your authorized resellers. Surprisingly, the number of premier partners has not increased in equal proportion?

Cisco appoints premier partners only after investing extensively into specialized training and certification. We realize that much more service and support training have to go into assuring that premier resellers are able to provide the kind of consultancy and project implementation that consumers would appreciate.

Last year, we made a proactive decision to invest into the development of existing premier partners to help them achieve

higher levels in the customer value-chain. We had only three premier partners a year back. But today, the number has gone up to 80. We expect to double this up in a year's time.

What made Cisco, which has catered to the high-end segment till recently, shift its focus more on small and medium segment?

Is this shift applicable to India?

Globally as well as in India, Cisco has three major lines of businesses (LoB) -- enterprise, service providers and commercial (SMEs). The enterprise and service providers contribute the lion's share of business and profits for the company. However, it is the commercial LoB, which has been the fastest growing.

The trend has been replicated in India and Cisco realizes that there is a tremendous business opportunity in catering to the SME segment. This segment has been seen as an early adapter of technology. The expansion announced in channel network is further expected to boost this growth and thereby enhance the number of

consumers.

Could you explain your channel strategy?

We are updating our channel program to support current industry challenges. We want to maintain leadership position by evolving programs, which will continuously meet the market requirements. And to reflect the scope of our new program, we have decided to call it as the 'Cisco Channel Partner Program'.

The Program now places greater emphasis on value-addition, technical expertise and customer satisfaction. Specializations are integrated with certifications requiring every partner to specialize in certain technology areas. 

Partners may choose the technology area for specialization, but must earn a minimum number of points to become Gold, Silver or Premier Certified Partners.

The Gold and Silver badging continue to confirm that the partner has a required number of Cisco certified individuals on staff, is capable of both pre-sales and post-sales support, and provides value beyond just the resale of Cisco products. Cisco is focusing on specialization and certification, not on volume-based discounts.

How do you look at your channel training programs?

Cisco’s channel training programs are crucial differentiators for the company in Indian channel space. We train our resellers in all aspects, so that end-users are able to maximize their networking investments. This program is called 'Cisco University' and trains the reseller in concepts as well as provides him with ‘hands-on experience’.

In India, Cisco has trained about 1,500 sales and technical personnel through this program in areas such as LAN, switching, routing, VPN and security products. In fact, in the future, we hope to conduct programs in the areas of IP telephony and wireless LAN, as these are the emerging technologies.

Do you have any plans to manufacture in India?

No. Currently, we don't have any plans to set up a manufacturing unit in India.

By SAJI MP

in Mumbai