The scoop on Cisco’s resurgence in collaboration and its long range plans for IoT

A conversation with Rowan Trollope

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In fact, that’s what a lot of people told me in the beginning. But three years ago my belief was email was going to go away and be largely replaced by messaging. By the way, I’m a total nerd. I have hardware in my office and I still write code on the weekends. I’m constantly downloading the latest consumer chat applications. I’ve been deep on this stuff forever. I just love doing it. And three years ago I was already moving off of email and communicating with all of my friends using messaging. 

I’ve seen that with my son, who is 25. He doesn’t use email at all. He uses iMessage or SMS, web chat, etc. My belief three years ago when I came into this business was that’s the future. Messaging is going to replace email because it’s way better for team-based communication, for fast, short, informal communication. Email sucks and messaging is better.

Cisco, of course, had Jabber. When I looked at Jabber I said, “That’s just like AOL Instant Messenger from 20 years ago. That’s not the future. The future is going to be mobile based short messaging that’s like SMS on steroids.” That’s what the future is going to be. So the strategy was, “We’ll own the messaging space for business.”  That’s what we built with Cisco Spark. You can download it in the app store today. It’s a messaging app built for business.

We started building it and of course, six months later, Slack came out and I think the rest is history. Over the last two years it’s been shown that that’s the direction of business communications. We now have one of the leading messaging apps for business in the world. We have probably the most secure messaging app for business. 

I was going to ask about Slack. Why do you think it has done so well?

One, they really understood the importance of a team. You have to be invited to a team. When you do that, it eliminates all of the spam because it’s an invite-only thing. If you don’t want to know anything about that team anymore, you leave and you don’t get any of the messages. Nobody had done that before and it eliminated a lot of traffic. That’s number one.

Number two, they built an open platform right out of the gate and they went off and got a whole bunch of integrations so they could tie business-critical systems to it. The third thing is they found a beachhead in the development community in Silicon Valley. I think those three things, coupled with the design sensibility that Stewart Butterfield brought to the picture, they got a bunch of stuff right.

We have the same idea with teams. In fact, when you look in Cisco Spark you’ll see we have team-based communications. But the long game for us is, messaging leads to voice and video, which is our real differentiation. We’re a network company, and the reason why we’re in voice and video in the first place is those really need a great network. While it’s quite easy using modern technology to build a Salesforce.com, for example, it’s very hard to build a real-time communications network that is incredibly responsive and has great quality.

Our strategy is, let’s build an incredible, real-time communications platform with an amazing messaging application on the front because they go hand in hand. You start with messaging but pretty quickly you go, “Can we just have a quick chat?” At that point you want a frictionless way to get in touch with that person or persons with a voice or video call. 

With all the other messaging platforms you had to say, “Let me call you. What’s your number?” A whole interchange would happen in messaging to figure out how to connect people in real time. Our vision is, if we’re in a messaging thread and we decide we want to have a real-time conversation, we tap one button and it just goes live. That’s what we built in Spark. Nobody had done that before. 

Along the way we built a great messaging application. In fact, it’s transformed Cisco.  We have 50,000 people at Cisco using it every day instead of email. My email is down from around 500 per day to about 20 emails a day.

We were right about the business messaging thing and we have over a million paid users now for our messaging application. We’re really starting to transform it and we can play outside of the Microsoft pen. Microsoft doesn’t have a messaging application like that. There are very few of them in the world actually. Spark is one. Slack is another. HipChat is another. The rest of them are startups. None of the big guys except for Cisco have an incredible business oriented messaging platform. 

OK, let’s turn to your IoT responsibilities and the company’s vision there. So, leadership saw the success you had with collaboration and decided to reward you by giving you a whole set of unrelated technology?

With the Collaboration business swinging to success and the transition of our CEO, the conversation was, “OK, we need our next generation of leaders to step up and help the future of the company. This whole IoT thing is a new space and ripe for innovation, and you now have a reputation as a lead innovator in the company.” 

Of course, it’s not me. It’s my teams. I’m the drill major. I create teams that can innovate and inspire people by setting the vision. And IoT is incredibly interesting to me; connecting all the things in the world, and Cisco is in a great position because we’re the connecting company. The next generation of the internet is going to be totally different to handle an order of magnitude more things and, more importantly, diverse kinds of things.

This is a pivotal turning point. The ships that got us to the new world are not going to get us to the world that’s beyond. Now we need to build rocket ships to take us to that next world of the internet. Cisco can be part of that and we want to drive it. That’s been my new goal, to do that.

Connectivity is one thing, but the people I’ve talked to that are trying to leverage IoT, in the utility business, for instance, say the real problem is correlating the data and making sense of it.  Isn’t the opportunity going to fall to the people that are doing the correlation and making sense of the data?

Exactly.  That is actually the essence of my strategy. In order to maximize our opportunity, we can no longer think about ourselves as just a connectivity business.  We need to solve the full stack of problems. The way you do that is to solve the business need. As a part of my strategy, we’re building out new business units. 

We built a connected car business unit, and I’m just about to announce a leader for that. He’s saying, “The idea is to build a full stack of offers, not just connectivity. It’s not, ‘Let’s go sell a wireless modem to Ford.’ Its, ‘Let’s build a total end-to-end solution for Ford and everyone else that lets them deliver services to their customer, lets them collect telemetry data, etc.’” In other words, we have to move up the stack.

My strategy is, we’re building vertical business units who are building applications and the full stack of offers that just happen to include connectivity. 

So you’ll do that vertical by vertical?

Absolutely. The trick is to leverage the horizontal technology as best you can in order to get good margins. At the end of the day, a great business comes from solving customers’ needs better than anyone else. We’re focused on where the money is, then we drag along networking behind it.

Is that to say you have platforms in each of these verticals?

We have a platform we’ve defined and scoped and we’re basically skinning it for each vertical. We’ve taken something that’s common across the first three or four we want to do, and we’re adding capabilities for the verticals and then skinning it for that industry and building a go-to-market for that industry that’s very specific. 

It’s early days so a lot of this is speculative, candidly, but the key beyond the technology approach is how you do it, and that’s really where it’s all about iterating quickly and testing lots of ideas.

I’m building this team in a way that is like, let’s go test 50 ideas and we know that 45 of them are going to fail, five of them might work. We’ll take those five to the customers and, out of those five, maybe one hits. The design of the team is all about build fast, test a lot of things, move very, very quickly and find the nuggets. This whole transformation is so big that I think most people get lost. They’re trying to solve too many things. It’s too confusing. You could do everything. Everywhere you look there’s opportunity, but most of it is false. Most of it won’t turn into scaled, multibillion dollar businesses.

My view is, don’t get distracted by all the shiny object chasing that goes on. Try and have a system and a process that lets you hone in on the things that are really going to scale and then be almost maniacal about lopping off the things that aren’t working because they’re all going to be business someday, but not today. What are the ones that are going to be businesses next week? That’s the only way to drive success. We will acquire companies, but I’m a software developer. I want to build stuff. It’s way better if we can do it internally.

I imagine there are pockets of IoT all around the company. Did you centralize that?

We collected most of it. We reorganized and we moved most of the stuff into my group. All the one-off stuff that was happening, yeah, it was all moved over into my team. It took lots and lots of different initiatives. It’s a very diverse team.

How big are the two respective teams, at this point?

We have 4,000 to 5,000 engineers in the collaboration team. On IoT it’s still relatively nascent, so we don’t publish the numbers.  It’s early days, but hundreds of people.

Sounds like you’re having a lot of fun.

We are. It’s been great.

Copyright © 2016 IDG Communications, Inc.

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