Cisco's Chambers: 'We have lost some of the credibility'

Summary:Cisco CEO John Chambers said the company has a good strategy, but has lost is way and confused its employees. The upshot is that Cisco plans "a number of targeted moves in the coming weeks."

Cisco CEO John Chambers said the company has a good strategy, but has lost is way and confused its employees. The upshot is that Cisco plans "a number of targeted moves in the coming weeks."

The Chambers' fix-it memo comes as the company has fumbled recent quarters and disappointed investors. Cisco is under fire from the likes of Hewlett-Packard and Juniper Networks. The issue isn't the market. It's Cisco.

"We face a simple truth: we have disappointed our investors and we have confused our employees," said Chambers in a memo posted on Cisco's blog. "Bottom line, we have lost some of the credibility that is foundational to Cisco’s success – and we must earn it back. Our market is in transition, and our company is in transition.  And the time is right to define this transition for ourselves and our industry.  I understand this.  It’s time for focus."

Chambers then outlined a series of principles for these changes, which will be overseen by new chief operating officer Gary Moore.

In brief:

  • Cisco won't mess with units that aren't broken. "Our five company priorities are established:  leadership in core routing, switching and services; collaboration; data center virtualization and cloud; architectures; and video.  The importance of delivery to market through our partners is also clear – and we will do nothing but reinforce this," said Chambers.
  • Bold steps are on deck. Chambers promised "surgical precision" to fix problems in Cisco's portfolio.
  • Cisco won't be defined by competitors. "Our strategy to extend the role of the network will not change. Our approach to leadership in the core amidst this transition will change. In switching we understand that our customers are buying across broader segments and specific needs in this market. We understand that our competitors in this area are fierce, with different business models and architectures.  We will not be defined by them," said Chambers.
  • The company will simplify work. "We will simplify the way we work and how we focus our attention and resources," said Chambers. "We will significantly rework our systems, tools and funding models to do this."

That final point is worth noting since Cisco has focused on social networking tools to get projects done, surface good ideas and rate managers. Chambers had listed this social push as Cisco's biggest risk.

Topics: Cisco

About

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CN... Full Bio

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