Cisco moves forward with scheduled reorganization affecting thousands of jobs

UPDATED: As promised during its most recent earnings call, Cisco is moving forward with a major internal reorganization.
Written by Rachel King, Contributor

Many headlines depict a golden age of wealth and grandeur going on in Silicon Valley, but there are also many upheavals and downward trends that can't be ignored or swept under the rug.

Amid splits seen at Hewlett-Packard and eBay/PayPal, Cisco is moving forward with its own restructuring effort.

As promised during its most recent earnings call in August, the networking giant is undergoing a major internal reorganization.

At the time, CEO John Chambers and CFO Frank Calderone warned shareholders about the internal shuffle, which would also include considerable layoffs.

A timeline wasn't revealed immediately, but the executives projected the cuts would reduce Cisco's workforce by approximately eight percent, rounding out to roughly 6,000 jobs.

They added the workforce reduction would be worth approximately $700 million.

At present, reports are circulating that Cisco's planned cuts and shifts are already underway. The Business Insider reported on Wednesday that approximately 25,000 employees are affected by the redirection, although it is not clear yet how many of these roles are being cut or simply moved into different departments.

ZDNet reached out to Cisco for comment, and we will update this post once we hear back.

UPDATE: A Cisco spokesperson confirmed the report and responded with the following statement:

We will continue to make the business decisions and bold moves we need to make to secure our leadership position in the market going forward. Three years ago, we started our transformation and our solid results in Q4 and for FY14 reflect the good progress we have made to date. But we are not done. We are continuing to make the moves to drive more innovation, speed, agility and efficiencies in our business and move from selling boxes to selling solutions, architectures, solutions and outcomes.

Earlier this summer, we brought our sales and engineering closer together. For example, the work we are doing in engineering to implement a DevOps and an Agile development model, the work we are doing to integrate our products and services sales teams into one solutions salesforce, and the work we are doing in services extending into new market opportunities. These are big moves that we expect big impact over time for us. It's a different way of doing things that will allow us to be faster and even more responsive to our customers and the market.

As announced on our August 13 earnings call, Cisco is conducting a limited restructuring across several segments of our business that will impact up to 6,000 roles or up to 8% of our global workforce.  Technology disruption has never moved more quickly, requiring all companies to adapt and accelerate through change. We are taking action now to build for the future of cloud, security, virtualization, analytics, data center, IoE and collaboration. We will continue to invest in growth, innovation, and talent, while managing costs and improving efficiencies across our business. We are continuing to hire, especially in the areas that help our customers solve their biggest business problems.

Of Cisco’s approximately 25,000 employees in the development organization, many — but not all — have  new reporting lines as part of our overall effort to align our business to priority areas.

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