Cisco's Robbins: 'Customers Are Tired of Being Systems Integrators'
"If... supply chain problems aren't going away anytime soon, maybe you need to change the way you sell," an analyst said.
![Cisco's Robbins: 'Customers Are Tired of Being Systems Integrators' Cisco's Robbins: 'Customers Are Tired of Being Systems Integrators'](https://eu-images.contentstack.com/v3/assets/blt10e444bce2d36aa8/bltabc617c4d9166a56/6524265f3bad6c6ee853dfcb/IMG_5504.jpg?width=700&auto=webp&quality=80&disable=upscale)
Attendees gathered in the Mandalay Bay Convention Center for the keynote session on Tuesday morning.
The crowd gathered at Michelob Ultra Arena in Mandalay Bay. The arena, which fits 12,000 people, was filled to the max.
Chairman and CEO Chuck Robbins introduced the Cisco Live audience Tuesday morning.
His keynote, which featured an interview with Ford CEO Jim Farley, touched on global events that have deeply impacted the economy. That includes COVID-19, the war in Ukraine and nagging supply chain issues.
“If you were waiting in the last five years for things to be back normal, it just didn’t happen. The new reality is that there’s always going to be some sort of crisis,” he said.
Cisco chief strategy officer and general manager of applications Liz Centoni riffed on the theme of customer experience, which has been a big theme of the conference.
“Great experiences create loyal customers. Digital transformation is about experience transformation,” she said.
Todd Nightingale, Cisco’s executive vice president and general manager of enterprise networking and cloud, outlined recent changes to Cisco’s networking portfolio.
Cisco announced on Tuesday that customers can now manage their Catalyst switches through the Cisco Meraki cloud portal. In addition, they can manage their Nexus data center switches through a cloud-based portal.
These changes reflect an added emphasis Cisco is making on agility.
“For years, to be honest, I’m not sure that we as an industry or even Cisco were focused on agility as much as we should have. As an industry we delivered more and more power and sophistication every step of the way, as we built faster feeds and speeds and more complete feature sets. As we built more sophistication, we unlocked things we never thought were possible. At the same time, too often we passed the burden of complexity onto you, the IT teams,” Nightingale said.
Shahid Ahmed of NTT agreed.
“We all need to start simplifying, not making things complex. I think with this added technology, things have become really really complex,” Ahmed told Channel Futures. “But if you look at your Apple phone, it has become really simple, and we want to go in that direction. Even the most complex technologies can be made very simple.”
Nightingale, Robbins, executive vice president and GM of security and collaboration Jeetu Patel, Centoni, and executive vice president and GM of Cisco’s mass-scale infrastructure group Jonathan Davidson, fielded questions from the press.
An interesting line of dialogue occurred over the them of how Cisco regards itself in relationship to its technology partners. Particularly, what is the future of the telcos?
Davidson said Cisco will be helping the hyperscalers and carriers simplify increasingly complex networks.
“I think we’re going to see more of the hyperscalers putting their edges into the carrier’s networks. They’ll start with one, and fast-forward a few more years and all hyperscalers will be in all carriers’ networks. And the carriers will also have their own services. And we’re going to be offering our services on their edge,” he said.
Zeus Kerravala said the telcos need to evolve. Otherwise, they risk “becoming pipes.”
“If you’re a big AWS customer, you keep all the traffic on their network, and Cisco can help that. There’s a lot of connectivity between the hyperscalers now. From a telco perspective, the risk of them being disintermediated is actually pretty real, and I think they need to think of what their next act is going to be,” Kerravala told Channel Futures.
Kerravala said the telcos historically held a role of delivering the last mile and global private backbones. However, SD-WAN has essentially “nulified” the backbone coponent.
“I think they should be the ones that are aggressively pursuing SD-WAN and allowing customers to buy broadband from whoever they want, and manage it for them,” he said.
Although the carriers have adopted SD-WAN products, Kerravala said these offerings pale in comparison to what managed services provider can offer. In addition, many of the telcos sell SD-WAN with the provision that the customer also buy MPLS.
And using SD-WAN to prop up MPLS, he said, is not a winning strategy.
“Sure, there’s a lot of MPLS customers, but customers bought mainframs for a long time. The markets have declined. They need to figure out what their next wave is.”
On the other hand, Kerravala said the cablecos have done a better job of harnessing SD-WAN. That makes sense, as these providers don’t need MPLS to be successful.
Kerravala called the new cloud management capabilities of Cisco Catalyst an overdue change. Customers that use both Catalyst and Meraki can use the Meraki cloud portal to provision and manage Catalyst switches.
“Lots of customers run both, so it makes sense that they’d want to use one dashboard to manage both,” he said.
However, Kerravala said he’s curious as to what happens next. Will the integations impact either the Meraki or Catalyst platforms or end points?
“If you’re buying Catalyst, there’s a lot of unique features and customer configurations you want to do. And if you’re Meraki, you want simple management,” he said. “So when you combine the two, do you add a bunch of complexity to the Meraki device, or do you dumb down Catalyst management? In the latter case, why buy Catalyst? That’s going to be interesting to watch how that develops.”
Kerravala praised the announcement of ThousandEyes WAN Insights. The offering gives customers predictive insights into their Cisco SD-WAN offerings.
Kerravala said he was intrigued when Cisco bought ThousandEyes, in part because ThousandEyes is unique in the way it examines internet traffic. Two years later, Cisco is integrating ThousandEyes more deeply into the portfolio.
“I they’re finally starting to take advantage of that asset. It’s a really good asset. I think it could really help them expand what they’re doing,” he said.
Cisco this week announced AppDynamics Cloud, which specifically targets cloud-native applications for observability.
Kerravala said AppDynamics could play a larger role in furthering the go-to-market efforts of Cisco and its channel partners. Considering that customer experience has been a significant theme of the Cisco Live conference, Kerravala said AppDynamics is one of the best ways to measure customer experience. However, he said AppDynamics is one of Cisco’s more underutilized assets.
Partners, he said, should be using AppDynamics as the “tip of the spear” for customer engagements.
“They should go in there using AppDynamics as a way to understand what apps are suffering and how infrastucture upgrades could improve the performance of apps, and use that as a way to approach the sales engagement. But they don’t really use it that way,” he said.
Jay Patel is the vice president and general manager of Cisco’s Webex CPaaS initiative. He joined the company in 2020 when Cisco purchased IMImobile.
Cisco’s CPaaS offering wraps around its contact center offering to augment the customer experience in custom ways. For example, CPaaS might enable a company to create a text-based support platform for customers that don’t want to wait on the phone for a call center agent. Instead of a customer calling a store every day to see if a product has come into the inventory, the company can set up a flow that alerts the customer each day via text about the status of the product.
It’s use cases like these that Patel said enhances the customer experience. He said a Cisco study revealed that cost and customer experience were separated by only one-percentage point in terms of what makes them stick with a brand.
“Cisco’s partners can benefit from that growth can help their own customers essentially save money and improve loyalty,” Patel told Channel Futures.
The channel accounts for 90% of the Cisco CPaaS business.
Cisco hosted a session on the Metaverse. Studies Cisco conducted indicate that there is real business interest in leveraging more virtual and augmented reality. Jacqueline Guichelaar, group chief information officer at Cisco, said she has seen opportunities emerge in the banking, insurance, medical and government verticals.
“Every CIOs of big companies that I’m talking to, they’re all talking to their CEOs about this, and they’re all interested in it,” she told the audience.
Shahid Ahmed is executive vice president of new ventures and innovation for NTT, one of Cisco’s largest partners.
Ahmed pointed to two trends at Cisco that NTT has its eyes on.
The first is Cisco’s efforts around private 5G. Cisco earlier this year unveiled its private 5G-as-a-service offering, which it developed in concert with Open Radio Access Network (ORAN) providers JMA and Airspan.
For NTT, which launched a global private LTE/5G network-as-a-service platform last summer, Cisco’s offering could be an opportunity.
“We’re looking forward to taking a look at it, doing a test drive and making sure it works with our managed services capability,” Ahmed told Channel Futures.
Ahmed also pointed to Cisco’s partnership with Ford around autonomous vehicles. Although NTT wasn’t involved in the deal to integrate Webex on the Ford F-150 Lightning, Ahmed said Ford’s growing partnership with Cisco represents a rising tide of sorts.
Ford is one of NTT’s largest clients, and NTT serves it in the area of factory automation and IT operations.
“That allows us to be an even more productive partner for Ford, mainly because we do so much business with Cisco,” he said.
The “Responding to Global Threats” panel highlighted cybersecurity issues that Russia’s invasion of Ukraine exposed. Some of the experts mused that at some point in the future a country might choose to completely cut itself off from the rest of the world technologically due to threats.
Nick Biasini, head of outreach for Cisco Talos, said one of the most important things companies can do firm up their security posture is to audit their own environment.
“People do not have a firm grasp of what their assets are, where they’re located and who owns them,” Biasini said. “It makes it difficult to defend yourself if you don’t know what you’re defending.”
The “Responding to Global Threats” panel highlighted cybersecurity issues that Russia’s invasion of Ukraine exposed. Some of the experts mused that at some point in the future a country might choose to completely cut itself off from the rest of the world technologically due to threats.
Nick Biasini, head of outreach for Cisco Talos, said one of the most important things companies can do firm up their security posture is to audit their own environment.
“People do not have a firm grasp of what their assets are, where they’re located and who owns them,” Biasini said. “It makes it difficult to defend yourself if you don’t know what you’re defending.”
CISCO LIVE – Cisco Systems is encouraging partners to come along with it in its software-based, as-a-service journey, and in some cases partners are leading the way.
Cisco executives continued to outline their vision for a software-centric future at Cisco Live in Las Vegas. Chairman and CEO Chuck Robbins said the company has evolved from simply selling hardware boxes years ago.
“When I took over [in 2015], basically we sold technology products, and customers bought them and integrated them. And now we have a $17-18 billion dollar run rate software business,” Robbins told journalists and analysts on Tuesday. “We have a solutions that have cloud management with a piece of hardware on-prem, on-prem license software and pure SaaS solutions. We’re trying to provide our customers exceptional choice, however they’re going to consume it.”
Partner Evolution
Cisco’s efforts to promote managed services among its partners are no secret. Robbins said that while some customers still prefer to be DIY in provisioning Cisco technology, the majority of them want more help.
“Most of our customers are sick and tired of being system integrators,” he said.
Shahid Ahmed, executive vice president of new ventures and innovation for Cisco partner NTT, agreed. He said he sees Cisco making a positive shift to cloud and software.
“Most customers are looking for that software-as-a-service, network-as-a-service and infrastructure-as-a-service model,” Ahmed told Channel Futures. “The things Cisco is working on makes sense and will align to what customers actually want.”
Robbins said Cisco channel partners differ in how well they are keeping up with the shift to software and services.
“As usual, there are a handful of partners that are racing ahead of us, and we’re working with them. There’s a large portion of our partners that will kind of move into second base as we push and work with them. And then there’s some that won’t make the transition,” he said.
Supply Chain
Supply chain issues, which Cisco blamed in part for its latest quarterly earnings, loomed heavily over the conference.
Zeus Kerravala, founder and principal analyst at ZK Research, said the massive delays in shipments could lead partners to rethink their model.
“If you assume supply chain problems aren’t going away anytime soon, maybe you need to change the way you sell,” he told Channel Futures.
For example, perhaps their customers would pay a premium to receive a fast-tracked item if partners were skilled in quantifying how much they would benefit from having that product. That means having enough visibility into the customer environment to articulate the value of certain infrastructure upgrades.
“This supply chain shortage we’re in should force them to rethink how they go to market. You just can’t ask customers to buy the way they did before, pay more and wait,” he said.
The Cisco Live conference concludes Wednesday.
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