Cisco VIP Partner Program: Ricardo Moreno Shares What's Next

Like clockwork, since 2003 Cisco Systems (NSDQ: CSCO) has reworked its Value Incentive Program (VIP) every six months, updating its rebate and rewards blueprint to reflect newly eligible products, market focus and tweak on processes and structure.

In late July, on VIP’s 10th anniversary, Cisco took the wraps off of VIP 20, and, while Ricardo Moreno, Cisco worldwide channels senior director of strategy, planning and programs, didn’t disclose which products the networking vendor is emphasizing in the current edition of its rebate program, he did let a few tidbits out such as the integration of Express as a new program track.

So, the next question, of course, is what’s on tap for VIP 21? In an interview, Moreno discusses how Cisco thinks about VIP, strategic priorities and hints about what may show up in the next iteration.

With VIP 20 in the books, what’s next on Cisco’s priority list?
We look at incentives as part of an overall portfolio so VIP is strategically connected to other programs. Right now, we are driving a significant increase in deal registration (Opportunity Incentive Program) utilization and we are seeing very important growth in adoption, specifically in Partner Led. Over time we will approach 100 percent of the business being registered through OIP.

How is TIP doing? (Teaming Incentive Program for partners Cisco has qualified early in a deal)
TIP adoption rate is not as high as OIP but growing fast. In the last four quarters, the TIP pipeline has doubled every quarter to $1.15 billion total.

What are the key Cisco values you try to convey with VIP?
VIP is a value-based program. What that means is as the market evolves, we reward partners for that value. It’s important that the Cisco relationship stay preferential for partners. Also, we want to drive our business toward Cisco’s priorities and move together with partners.

How has VIP evolved since 2003?
At the first launch, partners were uncertain how long it would last. But by adjusting it every six months, we showed partners we were serious about the program. We learned to adjust to follow market transitions or feature a new product family but not to change too fast. And, we don’t pre-announce product rebates ahead of time to partners. We spend a lot of time looking into sales figures, forecasts, research material and input from the business units before deciding which products to emphasize. We’ve always had periods of fast and not-so-fast adoption. Maybe the market is ready, maybe it’s not.

How far ahead of time do you decide what to feature in the next VIP rev?
First, we are always canvassing with partners and whenever a new VIP period comes up we engage with partners internally and externally. We are focused on eliminating the unnecessary complexity of the partner program portfolio. About 12 – 18 months out we are thinking about the next value we want to emphasize, how to program and measure it, and trying to identify new market transitions. Six months before the next VIP we are considering product families and SKUs to feature and looking at any structural changes we might need to make, like when we adjusted from technologies to architectures.

How do you measure VIP success?
Success is always measured first on partner profitability. We also want to be sure that partners are happy so we look to chats and social media feedback. And, we measure if partners are selling what we want.