Although names like Steve Jobs and Bill Gates have become common terms associated with modern technology, there is another player who, until recently, was very seldom known outside of fortune 500 companies and nerd circles. The third wheel in the triad of I.T. muscle is John T. Chambers.
Mr. Chambers has steadily changed the face of technology as we know it since 1991 when he came aboard as the Senior VP of Worldwide Sales and Operations for Cisco Systems Inc. Arguably the biggest network and communications manufacturer in history. Bringing great success to Cisco was, and still appears to be, John’s number one goal. An article in The Business Insider, speaking of John’s beginnings at Cisco Systems states, “Over the next four years, he facilitated Cisco's growth from a $70 million to a $1.2 billion” (Blodget, 2011) . John was promoted again in 1995 when he stepped into the role of Chief Executive Officer. Since then, Cisco has seen astronomical growth.
In 2000, Cisco's market value went past the $450 billion mark. It ranked third in worldwide company value behind Microsoft and General Electric. And for a short period in late March, Cisco actually reached a total market capitalization of $555 billion and was the highest ranking company in the world. (Garza, 2011)
With statistics like these, one can only imagine that a pretty amazing tycoon must be responsible for this. Claiming huge advancements in the way that the World does business and even paving the way for the Electronic Health Record movement, Cisco certainly has the right to boast. The tech giant also has partnership programs all over the world to encourage educational growth and job skill development. After all of this, why has the media attacked Mr. Chambers so fiercely?
To fully understand the problem, one must first understand the reasoning behind the cause. Cisco has amassed a large amount of its own wealth from taking on many small companies. In the business world, this is called an acquisition. This is most common when we are talking about a large corporation that has the financial muscle to buy up competition and control their particular market. In order for this practice to be successful, a corporation cannot just acquire another business and let it lay stagnant. In order to keep these other companies going, management is necessary. Without this leadership, any business is doomed to fail.
However, what happens when the corporate takeovers become to frequent and all of the sudden, only half of the actual revenue generated is from the original business? Normally, this wouldn’t happen, as most companies are a little more careful when it comes to additions. Mr. Chambers, on the other hand, has such an aptitude for management and such a drive for success that he has thrown caution to the wind on multiple occasions. Ventures like the UMI, a consumer grade videoconferencing “solution”, and the Flip Video Camera were huge failures. Sure they brought the numbers up for a quarter or two and maybe even gained a little popularity but for the most part, hurt more than helped. Being the great business pioneer that he is, Mr. Chambers decided to implement a new style of management. Using mostly senior staff members, the CEO formed multiple committees to rule over just about everything imaginable. Some of the senior staff would actually spend a third of their time sitting on one or more of these groups. While this may sound ridiculous, this revolutionary way of thinking is not without good intention. The idea was to streamline the decision making process and allow specific concentrations where it is needed.
Unfortunately, this practice has left the decision making process in shambles, leaving upper management distraught to say the least. One writer stated,
“Two years ago, the Wall Street Journal detailed a management structure at Cisco that was so byzantine and bureaucratic that it prompted us to wonder aloud whether John Chambers had lost his mind. (Basically, Chambers was requiring hundreds of Cisco's top managers to spend at least a third of their time sitting on committees.)
And it turned out that Chambers had lost his mind.” (Blodget, 2011)
All of these misguided ventures are quickly becoming very public failures in the eyes of shareholders. This can, of course, be a fatal error. In early July, Mr. Chambers announced that Cisco may be slashing ten thousand jobs. According to his press release, this is intended to “streamline business” and aid in a reformation and restructure process that is, in theory, going to resuscitate Cisco’s palpitating heart.
Unfortunately, the C.E.O.’s promises are not received in good faith, but with harsh words and antipathy. Many are calling for his demotion and even more are begging for his complete resignation. Sadly, many people including shareholders are failing to realize that while John Chambers is the Chief Executive of the corporation, there are hundreds of managers and other leaders that are constantly helping him steer Cisco and keep everything copacetic. It seems hardly fair to blame a bad market share or outlook on one person that has a payroll, one could call a population. People are constantly pulling strings and making decisions that affect the company. John Chambers is simply a figurehead. When one is examining a company this size, it is most easily compared to a government. Granted, the United States has one Chief Officer who sits as the President of the entire country, but only a fool would assume that the National Leader makes ALL of the choices in regards to the welfare of the country. That is totally absurd and the situation with Cisco is equally ridiculous.
It is simply a case of people being afraid of their own financial well being and fiscal future. People in this situation naturally need someone to point a finger at and Mr. Chambers just happens to be holding a bull’s-eye. Although it hardly seems like justice, modern day society would hardly give resounding, “oh well, he did his best.” Over money, they would rather burn him at the stake.
This is a harsh reality, but reality nonetheless. It would be a nice change however, if someone were to stand up and say, “How many of you could do what he does, for even an hour?” Rest assured, pin drops could be heard around the world. Every time this man shakes a hand, it affects hundreds if not thousands of people. That sort of pressure would leave a lesser man in the fetal position looking for his “mommy.” Bottom line, the spectators need to work with Mr. Chambers instead of against him. After all, if the world remembers correctly, no one has complained about all of the revenue he generated for them over the past twenty years, right? So give the guy a break and let him fix it. Mr. Chambers, you can do it!
References
Blodget, H. (2011, May 13). THE TRUTH ABOUT CISCO: John Chambers Has Failed. Retrieved July 14, 2011, from The Business Insider: http://www.businessinsider.com/cisco-csco-john-chambers-has-failed-2011-5
Garza, G. (2011, January 9). The History of Cisco. Retrieved July 8, 2011, from Bright Hub: http://www.brighthub.com/computing/enterprise-security/articles/65663.aspx
Kaine, C. (2011, July 13). Cisco: John Chambers Admits It Was Too Fat . Retrieved July 13, 2011, from Seeking Alpha: http://seekingalpha.com/article/279274-cisco-john-chambers-admits-it-was-too-fat
