4 Comments

Summary:

As Cisco revealed its somewhat opaque plans to restructure itself, two things became clear: Marthin De Beer will take on a new role and the company is continuing to bet big on its nebulous Medianet strategy.

John Chambers, Cisco CEO

John Chambers, Cisco

Cisco on Thursday laid out its plans for reorganizing the company to focus on five main business areas, a move that was expected since April, when CEO John Chambers posted a memo explaining how Cisco could turn itself around.

It’s good that Cisco is taking strides. But the information the company shared today doesn’t provide a lot of transparency, nor does it engender a lot of confidence about Cisco focusing on the big threat to its networking business — namely, the idea that networking itself is changing, becoming flatter and will be less indebted to the proprietary-software reliant, high-cost gear that Cisco sells.

As stated in April the company will focus on five businesses:

  • Core routing and switching
  • Collaboration
  • Cloud computing and data center virtualization
  • Architectures for business transformation
  • Video

Amid a lot of internal restructuring, there were two bits worth mentioning from the Cisco release. One is that Marthin De Beer will head a dedicated Emerging Business Group inside the engineering organization. De Beer was responsible for building up Cisco’s Telepresence business and is also one of the executives on Cisco’s group of people who decide on the company’s acquisition projects. The other is that Cisco is still pursuing its nebulous “Medianet” strategy, with the release saying that De Beer will have a “continued focus on integrating the Medianet architecture for video across the company.”

I covered Medianet back in its inception when it was primarily a marketing term designed to push Cisco’s gear as the solution to a rising tsunami of video traffic. I am concerned that the focus on Medianet means Cisco is still focused on video delivery and service providers rather than the more broad goal of rethinking network architectures to fit in an age where traffic is growing, it’s coming from a multitude of devices and locations and even different networks, and customers are demanding more agility. Perhaps cutting down on bureaucracy at Cisco improves its internal agility, but it needs to focus on the network itself.

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  1. Frugal Living Thursday, May 5, 2011

    Even though Cisco is currently battling through problems, they will still be the cream of the crop in their space

  2. Cisco is increasingly beginning to sound like a has-been. If Cisco were to focus on optimizing the network transport/handoff/accelerate capabilities, there might yet be a future for their wares. The latest round of redrawing the strategy fails to recognize that Cisco has veered from its core competency, the network core, and needs to bring it back into laser-focus.

  3. Brad Reese Friday, May 6, 2011

    Hi Stacey,

    I you do a Google search for the key words:

    brad reese speaks

    You will find a very detailed report on Cisco’s restructuring.

    Sincerely,

    Brad Reese

  4. Brad Reese Friday, May 6, 2011

    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:

    “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.”

    Sincerely,

    Brad Reese

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