At the end of this week, Cisco chief John Chambers steps down after two decades. Chris Middleton looks back, and to the future.
John Chambers, outgoing CEO of networking equipment giant Cisco, began his final week at the helm with a blog post on LinkedIn, reflecting on his 20 years at the top.
Chambers, famous within the industry for his quiet, but quasi-evangelical, speeches in which he walked through the conference crowds, said that former General Electric chief Jack Welch had told him, years ago, that he had a “good company, but not a great one”.
“I asked him what it would take to make Cisco a great company,” wrote Chambers. “He said, ‘You need to go through a near-death experience’. Having faced many challenges as CEO, I now know that he was exactly right.
“Over the years, I realised that the bigger the disruption – or potential ‘death’ scenario – the bigger the opportunity. Radical changes and moments of disruption can be scary and often uncomfortable. But when you get out of your comfort zone and tackle new opportunities and identify the market gaps that you can fill, you often succeed.”
Twenty years of change
Chambers’ two-decade tenure at Cisco coincided with disruption after disruption. The 1995 tech landscape witnessed the birth of ecommerce, which was followed over the years by the dotcom boom and bust; Web 2.0; the rise of the millennial, digital-native generation; smartphones; mobility; flexible working; cloud computing; social platforms; mobile apps; BYOD; wearables; and an influx of low-cost Chinese manufacturers to Cisco’s turf.
Throughout all this disruption, Chambers retained the calm of a man who knew that he who owns the networks is the only one really in control, and so he who makes the networking equipment – and routes the traffic – will always be relevant. Cisco’s routers have been core to its success.
In the same timescale, IBM stopped making PCs and became a services company, HP spun in as many circles as it had CEOs, Apple was born again and its lost leader was deified, Oracle stopped kicking the cloud and began selling it hard, SAP noticed that SMEs and simplicity existed, Google became an omnipresent know-it-all, social networks challenged users to find the signal amidst the noise, and Microsoft lost control of the software industry amid a great deal of stomping and bluster.
But everyone now agrees: unified communications and collaboration in the cloud is the present, and the future adds the Internet of Things, for which Cisco has introduced a number of new lines.
Of course, no two decades in a technology company’s history could be without controversy or missteps, including allegations of IP infringement, antitrust activities, NSA backdoors, and the rest: today, all practically US technology industry benchmarks.
Like Microsoft, Cisco has struggled to find the right solutions for the mobile world. Cisco also dabbled with being a consumer tech company – a rare loss of enterprise focus – and made a bet on big-iron telepresence systems just as the BYOD, mobile world was taking off.
This weekend, senior VP of Worldwide Field Operations – aka ‘the sales guy’ – Chuck Robbins, takes over as CEO, leaving Chambers as executive chairman of a company that has (2014) net income of $7.8 billion on revenues of $47.1 billion. Revenues and incomes are down, however, but assets are up. So the message is clear: sell, sell, sell!
So does Chambers have any final words of advice for anyone starting out in the IT sector?
“For start-ups, the key to success is long-term, exponential thinking, which also requires the ability to move quickly,” he wrote in his LinkedIn blog. “But if you try to move too fast without a process that can scale, it can be just as bad as not moving at all.
“At Cisco, we’re always thinking about where we want to be five to 10 years out, how we can differentiate ourselves two to four years out, and how we’re going to execute over the next year.
“But this type of discipline needs to be combined with a willingness to innovate. You must also be open to trying new things or else you risk missing windows of opportunity. The ability to move fast, with process has gotten us through challenging times, and has helped us emerge stronger as a company.”