Enterprise Agreements: Getting a Grip on Cisco Software Spend

Go to any IT event and listen to the discussions around you. Before long, you’ll inevitably hear the conversation turn to budget squeeze. A lot of thought and effort goes into scraping off savings here and there, but sometimes there’s an easy way to make a big difference. That’s where I come in. I can share with you some new ways to consume and adopt Cisco software inside your organisation, with a focus on delivering exceptional business outcomes.

If yours is anything like most organisations, you probably spend between 25 – 30 percent of your IT budget every year on software licences. You also probably spend more time and energy than you’d like in managing the process, too. My job is to help our customers find the most affordable and practical way to acquire Cisco software – and I’m pleased to say I’ve unearthed annual savings of more than 30% for some organisations.

Enterprise Agreements (EA) and Streaming

The more enlightened vendors have put a lot of thought into streamlining licensing arrangements, with Cisco undoubtedly a leader of the pack. While they have invested heavily into their software development over recent years, they have also developed a deeper understanding of how the needs of customers has evolved. This insight extends beyond the functionality of the products – which is excellent – to influence the way the software is purchased.

The Cost of Over or Under-Provisioning Software

In other words, Cisco are smart enough to grasp that it is important to make the administration and budget side of software acquisition simpler. A typical challenge is that different people, in different parts of an organisation, have purchased software as and when it was needed, without consulting the IT department. Some licences are automatically renewed when they are no longer needed, while others are in danger of expiring, leaving critical business functions exposed to risk. Over time, the IT department may lose visibility of software licence arrangements.

The busier the IT department, the more visibility is likely to suffer. Sometimes there just isn’t time to match software needs with software already acquired. As users come and go, a complex web emerges, potentially trapping a large portion of annual IT budget. The longer the situation continues, the greater the excess costs incurred, and the more time is spent trying to administer something that is hard to see.

In the case of customers such as the University of Adelaide, multiple contracts and renewal dates made for an inefficient environment. Given that digitisation is a major competitive factor in the higher education sector, efficiency and well-placed spending were key. Read how we were able to streamline their licensing landscape here.

A Range of Cisco Finance Options

When I work with a customer, I investigate more than just their software consumption needs. An important part of my role is to also learn about their organisation’s buying patterns, history, any leasing restrictions, their future plans and business culture. After all, the more I know, the better I can recommend the best Cisco software arrangement.

These arrangements may include a range of leasing options and as-a-service software consumption possibilities. There’s an entry point of around 1000 seats to make an EA a path to consider – those usually benefitting the most include large to mid-size corporations, public sector and education organisations. Those smaller can still gain advantage from finance arrangements that cost far less than a bank loan, in most cases giving a welcome switch from capital expenditure (capex) to operational expenditure (opex).

How EAs Work

Each EA is designed to fit customer needs, so no two are identical. Still, Cisco EAs have some factors in common. An EA covers the entire organisation, allowing for software to be acquired for the time it is needed in a flexible arrangement. You select the software licences you need, add as you grow, and deploy, then re-deploy, as needed.

An EA relationship typically spans three to five years. Of course, in that time things can change, and if your organisation grows, you don’t want to be hit with costly additional software charges. Cisco took the step of including 20% growth allowance in their EA contracts, giving financial predictability. There are no retrospective charges. This is another touch that reflects Cisco’s effort to understand customer needs – growing a business is hard enough without stressing about software licence increases. We don’t have a magic wand, but at least that is one stress we can resolve easily.

The EA covers the entire organisation, whether it is all in one city, or spread across Australia or globally. By unifying needs, you get greater buying power. I help you to leverage that group purchasing to get a better deal.

Connecting the Right EA Team

Once I learn about your organisation’s situation, restrictions and business outcomes, I narrow down the various options and engage my Cisco counterpart to put together a proposal in front of the clients. I set up meetings with the relevant Cisco Account Manager and Cisco’s leasing arm (Cisco Capital) and we collectively go through the finer details. The alignment between Cisco and Data#3 is one of the most pivotal step as we embark on an Enterprise Agreement journey with a customer.

Working with a large vendor like Cisco, it can be challenging finding the right contact for an account or a particular vertical. Working with Cisco over the past few years has given me good understanding of the right contacts at Cisco. These contacts are spread across various architectures, buying programs and verticals. I leverage my relationships with these contacts when working on software opportunities with customers.

As Cisco moves from a capex to an annuity-based business, they are keen to grow their business, which makes their pricing competitive – this means my buying program may give more agility than you would expect from other vendors. Given their investment in very good software, a Cisco EA often makes a better value proposition.

Choosing a Finance Solution?

Time to streamline your Cisco software, and take advantage of better managed costs? Complete the contact form below for more information, and to learn which finance options may suit your organisation.

Tags: Cisco, Cisco Enterprise Agreement, Cisco Software, Consulting, IT Lifecycle Management



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