Cisco tries to reinvent itself
Posted
Jan 28 2008, 03:27 PM
by
Kim Peterson
Rating:
Cisco Systems, whose shares have fallen 27% since October, is "reinventing" itself, according to a big writeup yesterday in the San Jose Mercury News. The network equipment company's trying to make the case that it's now cool and totally into Web 2.0 and social networking. Dude, they use wikis!
Funny, though. As I read the article I kept thinking how bloated and overmanaged everything sounds. This "new" Cisco seems mired in bureaucracy. Consider these points from the story:
- In the past, Cisco has only taken on one major project a year. This year it's aiming for 20.
- Cisco strategymaking used to be done by four internal councils with 50 members. Now, 25 councils and boards of up to 1,000 people will do it.
- Cisco produces 900 video broadcasts a month for employees and outsiders. Who watches all of that?
- The pace of product rollouts is staggering -- 150 in the past six months.
There's an odd anecdote about how Cisco picked a new musical logo in only six months. "Normally, developing a five-note tune would take 18 months," the story said. The company asked 12,000 employees to fill out surveys with their ideas for the logo. Who read 12,000 surveys? Maybe one of those new councils.
And it took six months to come up with a five-note tune? That's one note a month, with an extra month to play it back over and over, I guess.
This "new" Cisco may take a toll on some employees. One executive, Tony Bates, said he sometimes gets to work at 3 a.m. and doesn't finish his virtual conferencing meetings until after dark. That doesn't sound very efficient.
CEO John Chambers admitted that as much as 20% of top executives "couldn't make the transition" to the more collaborative work environment. If one-fifth of your best employees can't cut it in the new regime, then you've either hired the wrong people or the culture needs to change.
The point of the story is that Cisco is trying to be more nimble, open-minded and communicative as it diversifies its product lineup -- and that's smart. (Today, the company unveiled a new network switch that can transfer huge amounts of data in seconds). Cisco is very good at its core network equipment business, and that will help buffer the risk from new ventures into TV set-top boxes and other areas.
Cisco must keep its focus sharp, especially with 20 new projects this year. Its revamped council structure smacks of too-many-cooks confusion. I hope Chambers can maintain a clear vision as his company expands.
Disclosure: I don't own any shares of Cisco Systems.
