BradReese.Com Cisco vs. ZTE Price Quotes

Home About Repair Power Supplies Refurbished Blog Quick Links Site Map Contact Us

Brad Reese speaks out


Power Supplies

VoIP Gateways

Cisco Repair

Refurbished Cisco

Cisco CPQRGs

New Cisco

New HP ProCurve

Cisco Tools

Competitive Lab Tests

Tech Forums

How-to Tutorials

CCIE Gossip


View archive of Brad Reese speaks out

Subscribe to Brad Reese speaks out

Cisco's restructuring embeds operating committee, councils, boards and working groups deeper into Cisco's new management structure
Thu, 5/5/11 - 11:59pm    View comments

Update: 5-26-2011

Brian Schipper senior vice president of human resources bolts Cisco

My take is that Cisco's convoluted Councils and Boards just got even more convoluted and will perhaps this time prove lethal to Cisco, causing a much more rapid deterioration in Cisco's business prospects!

Robert AckermanJohn ChambersA month ago, I blogged that Cisco CEO John Chambers had-to-go!

Today, Allegis venture capital founder - Robert Ackerman, spoke about Cisco in the following Bloomberg article:

Cisco Reins In Management System That Spurred Exodus at Top

"They've got a culture that frustrates talented people. They've got a lot of talented people feeling like they're beating their head against the wall."

Cisco's Councils and Boards
New Cisco Organizational Chart
Cisco's Worldwide Field Operations
Cisco Services
Cisco Engineering

Councils and Boards

Update: 5-12-11

In a CNBC video newscast today, Cisco CEO John Chambers at the 1:22 time mark dodged and avoided any and all responsibility or accountability for implementing the Councils and Boards management structure within Cisco.

Outrageous in my opinion, especially given that Chambers is clearly shown bragging and taking total ownership in this earlier video recording with Popply Harlow of CNN Money for his brilliant implementation of Cisco's convoluted Councils and Boards management structure.

Chambers also megalomaniacally and preposterously predicted in the video that his Councils and Boards would become the future management structure of Cisco's customers too.

Amazingly in my opinion, Cisco announced a major new restructuring that further embedded Cisco's convoluted operating committee, councils, boards and working groups deeper into Cisco's new management structure:

Rerouting Cisco
Source: Cisco Systems

For example, Cisco's new management structure will now have the following 3 customer-facing Councils deeply embedded:

  1. Emerging Countries Council
    led by
    Wim Elfrink Wim Elfrink Edzard Overbeek Edzard Overbeek
  2. Enterprise Council
    led by
    Paul Mountford Paul Mountford Padmasree Warrior Padmasree Warrior
  3. Service Provider Council
    led by
    Nick Adamo Nick Adamo Pankaj Patel Pankaj Patel
Cisco executive vice president and chief operating officer - Gary Moore, provided the following details about Cisco's Councils and Boards within Cisco's new management structure:

Gary Moore"We will refine our Council structure to three councils that reinforce consistent and globally-aligned customer focus and speed to market across major areas of the business: Enterprise, Service Provider, and Emerging Countries. These councils will serve to further strengthen the connection between strategy and execution across functional groups.

"Each Council will have two leaders, empowered through their functional roles with investment capability. We are aligning budget control to investment decisions, and Council leaders are accountable for the execution within their respective functions, and across the company."

Moore continued, "Decisions on go-to-market strategies and customer value propositions to these markets will be made by the Council leaders in the context of Cisco's overall portfolio opportunities.

"These Councils will determine which Boards are needed to support execution and alignment. Boards will focus on informing decisions and accelerating the execution of decisions through cross-functional alignment. Many of the Boards have made significant contributions to our business and will continue to play a critical role in our go-to-market and architectural direction."

Moore added, "Only Cisco's three customer-facing Councils will have Boards. The charter of all remaining Councils and Boards should now be clearly in the scope of functional organizations, and will be absorbed into their respective functions."

Moore concluded, "The organizational changes announced today allow us to simplify the Council and Board model to dramatically reduce the number of touch points and interlocks required to get things done."

Update: 5-11-11 (Cisco's Q3'FY11 earnings call transcript)

Brian ModoffBrian Modoff - Deutsche Bank AG

"Yes, councils. So you went from 5 to 3. So you are streamlining them, but do you think -- are you contemplating perhaps eliminating them all together? Do you think more of a direct line management structure might be a better structure for the firm to get more direct accountability to the various divisions?"

John Chambers

"Let me have Gary go through it in just a second, but let me be very explicit. We went from 9 councils to 3 councils. And we went from 42 boards to 15 that we've moved the decision-making clearly into engineering and into sales for the decisions. We used the councils by customer segments, which are enterprise, service provider and emerging, and that's to connect our strategy to connect it with our operations. Clear decision-making is back in the functional groups and Gary has just done an amazing job here. So Gary, take us down one more level."

Gary Moore

"So I mean, at the high level, John hit it quick. So to come at it a different way, the key message here is we moved to functional leadership driving the 3 councils we have left. So Padmasree Warrior, who is one of the co-heads of all of engineering along with Pankaj, the 2 of them own the number along with -- Rob's organization that he announced. Nick Adamo, aligned to Pankaj, drive our customer-facing business with service providers globally. They make the decision, and they own the number so it's not a group thing anymore. That group, that council is there so that we can stay close to those customers, collaborate across the different functions that support them, but more importantly, get that feedback into engineering from a product point of view, as well as when we talk to you about our Service Provider business. We have to be aligned and competitive in the Service Provider business. Same thing in Enterprise. And so Padmasree Warrior and Paul Mountford will co-lead that council and they both have decision-making responsibility for both sales and engineering. The third council that we left in place is also customer-facing from the point of view. It is our emerging countries council, and that council is, again, helping to drive the transformation we're doing. We're setting up legal entities. We're doing a lot of work at Cisco to get things done to be able to operate in countries where we haven't had the infrastructure. I felt it was important to let that work continue on, and there's a lot of good people that are driving that. So again, we're holding the country leadership accountable to drive that, but we're giving them a forum to reach into. So elimination of 6 councils and 31 boards that we did is not the headline here. The headline here is the way we've changed the way we're operating to drive simplicity and agility into the organization. As John said, we're going to drive our earnings faster than our revenue. This is the way we have to do it."

John Chambers

"So simple takeaway in summary, we simplified the organization and operating model. That's what we just did, and we did it both with engineering, sales and also our services. We are using the councils and board purely as how you connect the strategy to the execution which, by the way, you need architecturally. We also recognize that the strength during one stage of your development, i.e. developing the visual products to compete with each other during the 90s becomes your weakness later. Councils and boards, we didn't evolve quickly enough where we needed to go on that. It allows us to align cost structure, it allows us to make better decisions in terms of who has ownership on divesting of underperforming assets the way we're set up, and bottom line it brings more value to our shareholders. That's what we're really focused on short and long term."

Cisco's updated corporate organizational chart:

Cisco COO Leadership Team
Source: Cisco Systems

Worldwide Field Operations

Cisco reorganized its Worldwide Field Operations team into three geographic regions to drive faster decision making with greater accountability and alignment:

  1. Asia Pacific/Japan/Greater China (APJ/C)
    led by
    Edzard Overbeek Edzard Overbeek Owen Chan Owen Chan
  2. Europe, Middle East, and Africa (EMEA)
    led by
      Chris Dedicoat Chris Dedicoat  
  3. The Americas (U.S., Canada, and LATAM)
    led by
      Chuck Robbins Chuck Robbins  
Cisco Field Operations will continue its focus on key customer segments and partners. The Service Provider segment will be led by Nick Adamo, and the Enterprise segment, which serves large enterprise, public sector, commercial, and small businesses will be led by Paul Mountford. These changes are effective as of Q1'FY12. Further details and updates will be shared by Cisco in the coming months.

Cisco Services

The Cisco Services organization will continue to be led by Gary Moore. For greater customer focus, Services will have the same structure as the Worldwide Field Operations team.

Nick EarleEffective immediately, Nick Earle will now lead the Cisco Services Sales and Partner team, which will become an integrated organization and will align to the changes announced in Cisco Worldwide Field Operations at the start of FY12.

This alignment includes:

  1. Asia Pacific, Japan and Emerging Markets
    led by
      Bob Singleton Bob Singleton  
  2. Europe and GET
    led by
      Nick Earle Nick Earle  
  3. Services Channels and Operations
    led by
      Karl Meulema Karl Meulema  
  4. US & Canada
    led by
      George O'Meara George O'Meara  
Starting FY12, Cisco will evolve the Services Sales team for further simplicity, agility, and empowerment. This new framework mirrors the Worldwide Field Operations team for alignment between Products and Services in Cisco's field activities and customer engagements:

Three Geographic Sales Regions

  1. Americas
  2. Asia Pacific, Japan, Greater China
  3. EMEA
Two Global Market Segments
  1. Enterprise
  2. Service Provider
Services Channel Organization

Over the next quarter, Cisco's Delivery operating model will remain predominately the same, with increasing alignment to support the new Sales organization structure. Look for announcements in the coming 30-60 days that address the adjustments to Advanced Services and Technical Services to align to the new Sales structure.

Advanced Services:
Parvesh Sethi will continue to lead the Enterprise segment and Sameer Padhye will continue to lead the Service Provider segment. The Advanced Services team will continue to develop and deliver customer-relevant solutions. Partnering with both Product/Services Sales and Engineering, the opportunity for Cisco's Advanced Services to increase customer success through product and architecture absorption has never been greater.

Technical Services:
Joe Pinto will continue to lead Cisco's Technical Services team globally.

Strategy Remains the Same:
The core strategic tenets for Cisco Services that were prioritized during Cisco's February leadership workshop remains the focus for the Services organization as they continuously strive to improve Cisco's ability to deliver for its customers and enhance its employees' experience. These four tracks remain:

  1. Go-To-Market
  2. Portfolio Led
  3. Operating Model
  4. Talent
Today, more than ever, these areas remain critical for all of Services as Cisco seeks to simplify processes and align for improved impact in the market.

Services Marketing and Communications:
The Services Marketing and Communications team, led by Karen Walker, will join Cisco's Global Marketing and Communications Organization effective immediately, reporting to Blair Christie. Bringing these teams together will help accelerate Cisco's Services message and provide the opportunity to integrate Cisco marketing and communications activities to more clearly and consistently tell the whole Cisco story.

Cisco Engineering

Cisco's Engineering team will now be organized functionally to drive technology innovation, accountability, and alignment across all five of Cisco's priority areas (1. routing, switching, and services; 2. collaboration; 3. data center virtualization and cloud; 4. video; and 5. architectures for business transformation), and Cisco will no longer have a Development Council (CDO).

Marthin De BeerPankaj Patel and Padmasree Warrior will now co-lead Cisco's Engineering organization.

Within Cisco Engineering, a dedicated Emerging Business Group, led by Marthin De Beer, will focus on new and emerging businesses including TelePresence, Emerging Technologies, and Consumer. The Cisco Engineering organization under Patel and Warrior will continue to report to Gary Moore.

Marthin De BeerKathy Hill will move into a new leadership role, focused on improving Cisco's product operations and profitability by evolving the way Cisco Engineering and Cisco Customer Value Chain Management (CVCM) work together. In this role, Hill will report directly to Gary Moore. Hill's current team will continue to be part of Engineering.

The changes across Cisco Engineering are effective immediately. The week of May 16th, Cisco Engineering will announce its next level of organizational structure.

Resource allocation and profitability targets will move to the Cisco sales and engineering leadership teams, which will have accountability and direct responsibility for the business results.

Over the next 90 days, Cisco will be announcing adjustments to support functions to align to changes across key functions, including operations, marketing, legal, human resource, finance, along with Council and Board focused roles.

Related stories:

Rifts between management and engineering appear to be depressing Cisco's stock price

Cisco's FY11 global workforce reduction appears to have specifically targeted the United States

California law firm warns Cisco employees: Do not sign severance agreement

1,826 Cisco WebEx and collaboration employees guillotined by Tandberg executives

Cisco insight series: Expendable Cisco business units and employees

Discord between Cisco engineers and Cisco technical marketing appears rampant

Brian Schipper senior vice president of human resources bolts Cisco

Cisco's 2011 voluntary enhanced early retirement program (EER)

Why do you think Cisco has embedded its Councils and Boards deeper into its new management structure?

Contact Brad Reese

Subscribe to Brad Reese speaks out

Brad's Favorite Story Picks

  1. CCIEs appear to have become an endangered species at Cisco, only 630 remain
  2. Cisco's 2011 voluntary enhanced early retirement program (EER)
  3. How to easily hire a Cisco CCIE
  4. Cisco Nexus 5010 and 5020 vs. Arista 7124S and 7148SX competitive lab test
  5. An inside look at Cisco's new data center
  6. Cisco's CRS-3 flexible packet transport vs. Juniper's T series, JCS1200 and PTX series
  7. Why Cisco CEO John Chambers has got to go!
  8. Did Brad Reese tee up Cisco CEO John Chambers as a defendant in a new insider trading class action lawsuit?
  9. Cisco Nexus 5548P vs. Arista 7148SX, IBM BNT G8264 and Juniper EX4500 competitive lab test
  10. Cisco vice president Inder Singh named in insider trading scandal
  11. Has feisty Arista delivered a knockout punch to Cisco with new 7124SX switch?
  12. Half of Cisco's stock buybacks went to support Cisco's dilutive management compensation practices during Q2'FY11
  13. Fired top Cisco exec has been cleared of all criminal charges by court
  14. Tax penalty claims against Cisco are growing at a staggering $11.7 million per day
  15. Did Cisco dump the ASA 5580 because of its HP heritage?
  16. Cisco's edge router market share has dropped a stunning -36%
  17. Network security will be the highest priority according to the 2011 IT spending intentions report
  18. Cisco's product gross margin dropped a whopping -10% over the past 5 quarters
  19. Cisco's Q2FY11 sales sequentially declined in collaboration, other, routers, security, switches and total sales
  20. View archive of Brad Reese speaks out
blog comments powered by Disqus

Brad Reese music work ambience

Supplement Cisco SMARTnet Contracts


©2013 BradReese.Com - Home - About - Repair - Power Supplies - Refurbished - Blog - Quick Links - Site Map - Contact Us