SAN DIEGO – Reflecting on a two-decade tenure as Cisco CEO marked by enviable success, John Chambers says he wishes the company could have moved faster.
“Mistakes that I’ve made [have been] when I haven’t moved fast enough” into new market opportunities, Cisco’s outgoing CEO said to a room full of reporters during an open-ended question-and-answer session at the Cisco Live conference in San Diego. “Or I moved too fast without process behind it.”
It was perhaps Chambers’ last meeting with the press as CEO given that he will step down in late July. Incoming CEO Chuck Robbins shared the stage and fielded questions along Chambers. (See How Chambers kept a high profile.)
Another challenge during Chambers’ tenure was workforce diversity, he acknowledged. Robbins has already made strides there, though, in naming five women to his team of 10 executive leaders.
“That’s one of the things that I’m really, really proud we’ve done well at the board and at the senior management level,” Chambers said.
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But he doesn’t have any regrets.
“Any company and any CEO who doesn’t take risks can’t lead their company,” Chambers said. “When you take good business risks not all of them are going to work out. And what I’m most proud of isn’t our successes – it’s how we’ve handled our setbacks. When we got knocked down, we understood how we got knocked down and we got back up.”
Cisco may have been knocked down a year ago by the National Security Agency’s apparent bugging of Cisco equipment during the order shipment process. As part of a widespread surveillance operation, the NSA was believed to be intercepting Cisco routers to plant bugging devices before repackaging the products with a factory seal and sending them to international customers.
John Chambers, Cisco’s outgoing CEO
That prompted Chambers to write to President Obama with concerns about customer trust in technology suppliers, and the potential impact on sales and the US economy.
Chambers was asked about that this week, a year later, on what has or hasn’t changed.
“Cisco’s reputation and trust is probably at the very top of countries around the world,” he said. “Even in Russia, they run their security systems in Moscow off of Cisco’s architecture.”
That statement was a curious one given that Cisco is under investigation for skirting sanctions in order to continue sales to Russian institutions.
Chambers continued: “I still believe our government leaders need to come together with rules of the road. Almost every government does do spying. That’s not new, that’s been true throughout history. I think it’s very important for the companies to be successful to understand that you have to have rules of the road government leaders will eventually have to come to a conclusion on.
“As a company, we’ve come through this as we’ve always done. We are not perfect but we are always transparent. And I think we’ve always encouraged countries where business is to make changes when it’s necessary for the economic strength of the world. If the next generation Internet is five to 10 times what the value of the Internet is today, it becomes even more important for countries around the world to come up with guidelines, and rules of policy and rules of the road as we move forward. That position has not changed.
“I found countries around the world listen very well, including ours here in the US, and that is true at all levels.”
The industry might be listening for more rumblings in the executive ranks of Cisco, which saw five top-level managers become lame ducks in a span of three days last week as Robbins introduced his team. Robbins says those waiting for more upheaval will be disappointed.
“Don’t expect there’s another something coming next week or the week after or the week after,” he said. “We’ve got a lot of tremendous innovation inside the company with some tremendous leaders, and we’ve got a couple of areas where we’re doing some external searches for some talent and the combination of that will be what we have going forward. We got this behind us and I don’t want anybody thinking that wait ‘til next Monday to see if there’s something else coming.”
Chuck Robbins, Cisco’s incoming CEO
He did, however, shed more light on the process by which some executives were removed.
“One of the key things that I asked of all of them is, ‘Can you commit for three to five years?’” Robbins said. “There are a few of those who have different aspirations, obviously. We made the decision together based on where they wanted to go and what I needed from a commitment perspective that they would do something else. We eliminated a layer in the organization. Over time, flatter organizations can move faster.
“Once we were clear on what we wanted to do we felt it was fair to those individuals as well as fair to all of you and our teams to go ahead and just state it as opposed to allowing it to just permeate unnaturally,” Robbins said. “We’re moving forward at this point.”
Asked why Cisco is looking externally to fill some vacancies – the company previously noted it is looking outside for talent in security, mobility, data center, Internet of Everything and cloud – Robbins said:
“Some really wise person said, 95% of the smartest people don’t work for us. The right way to build leadership teams is a combination of people from the inside who really know what’s going on and bringing in external expertise from things that are happening in the marketplace. That’s the strategy, that’s why we’re doing it.”