Zeus Kerravala
Zeus Kerravala is the founder and principal analyst with ZK Research. Kerravala provides a mix of tactical advice to help his...
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Zeus Kerravala | July 06, 2017 |


How CEO Chuck Robbins Rebooted Cisco

How CEO Chuck Robbins Rebooted Cisco Cisco seems to have its mojo back. Here's a look at what's working for the company.

Cisco seems to have its mojo back. Here's a look at what's working for the company.

When Chuck Robbins he took over as Cisco CEO in late July 2015, industry chatter was that the company's best days were behind it -- that it had become a fast follower instead of an innovator. Collaboration was sliding, security was nowhere, and software-defined networking was threatening to rip the heart out of Cisco's core networking business. Two years later, we see a much different company, both from leadership and operational perspectives. And the results have been more than positive.

Cisco CEO Chuck Robbins at Cisco Live 2017

For example, Cisco's stock price is at a 17-year high. (In fact, if you remove the period of time from October 1999 to December 2000 when every Internet stock exploded (, Cisco's stock is at an all-time high.) In addition, the company has rolled out a number of potentially game-changing solutions, including:

The mood at Cisco Live, held last week, was more positive than I have encountered in a long time. It seems everyone -- Cisco insiders, customers, and channel partners -- is looking forward to, rather than fearing, the future. Cisco has regained its mojo, not only in networking but as a thought leader for the industry overall.

How did Robbins turn the fortunes of such a large company around so quickly? Here are some keys to his success.

  • New leadership team -- Immediately after taking the helm as CEO, Robbins turned over the established leadership and put his own team in place. The former leadership comprised a number of great and talented people, but Robbins recognized the need for change and that he needed to do things differently. Any great company starts with a strong leadership team, and Robbins appears to have his humming.

  • Willingness to disrupt itself -- In the past, Cisco had been slow to embrace technologies that could disrupt itself. Software-defined networks come to mind as an example of a technology of which Cisco had been almost dismissive. But in one of the first conversations we had, Robbins told me Cisco would never, ever do that again. As the world's largest networking vendor, Robbins said he saw Cisco's responsibility as being to help, not hold back, its customers through industry transitions. The cloud-based team collaboration app Spark, which directly threatens Cisco's dominant on-premises collaboration portfolio, and intent-based networking, are two examples showing how the company has held true to Robbins' words.

  • Focus on simplification and ease of use -- Cisco has always had great technology and innovative features that enable it to keep a lead over the "good enough" competitors. However, the company's history is filled with really great features that customers don't take advantage of because they're too difficult to deploy. TrustSec, Identify Service Engine, and Performance Routing are just a few examples of great stuff from Cisco held back by complexity. I suspect Cisco's current mindset of being laser-focused on simplification is at least partially due to Rowan Trollope, who Robbins has elevated to the position of SVP and GM of IoT and Applications. As I've written previously," Trollope has an obsession with creating great products that are easy to use -- a commitment now seen across the company, with products like those from its Meraki acquisition flourishing. Creating great features takes superb engineering talent, and making those great features easy to use even more so -- and Cisco seems to have found religion in this area.

  • Leveraging breadth of portfolio -- For decades Cisco has had the broadest and deepest portfolio in the networking and communications industries. LAN, WAN, WiFi, UC, data center, security -- you name it -- Cisco plays in it. But does that matter? Sure it makes procurement simpler, but in Cisco's case one plus one hasn't equaled three in a long time. In the early VoIP days, enterprises believed that if they deployed Cisco telephony gear on Cisco networks, deployment times would be shorter and management easier than if they migrated to IP telephony with another vendor -- and so Cisco's VoIP share skyrocketed. Sometime since then the company lost its way, and the results have shown as its share in its core network products have slipped. Recently though, it seems to have figured out how to leverage the portfolio and the data it collects to create differentiated solutions. The company collects massive amounts of data from the large number of points of presence it has within a company, and now it's using that data to build unique products. Tetration, security, and Spark work like they do because Cisco is finally harnessing the potential of the data it generates. We are in an era in which data and machine learning will define market leaders, and very few companies have as much data available to them as does Cisco.

  • Competing on its own terms -- Each time Cisco goes toe to toe on features or price, it does itself a disservice. It might have more features or lower prices... or not, but either way doing those sorts of comparisons are competing on the other guy's terms. Cisco should rarely compete at a product level; instead it needs to focus on how to solve customer's big problems. For example, network hardware accounts for less than 10% of the overall total cost of running a data center, whereas operational costs tally to almost half. So instead of trying to prove its Nexus data center switch is better than the next vendor's, it has been focusing on helping customers knock 20, 30, or even 40% off of network operations. The same will be seen with intent-based networking, which enables enterprises to find threats faster and significantly simplify network operations. This is a much different sales notion for Cisco, which until just a few years ago tried to drive an edge refresh with multi-gig technology. Increasing edge speed from 1 Gig to 2.5 Gig might have been great for Cisco, but didn't matter to most enterprises... and no matter how good the PowerPoints are, customers won't buy things they don't need.

  • Embracing openness -- "The network is the platform" is something we've all heard from Cisco over the years, but until recently that platform has only been available for its own leverage. Traditionally, Cisco vendor partners offered easier management of Cisco infrastructure or filled holes in its product portfolio -- a nice ecosystem, for sure, but not one that added much value. Today, Cisco's ecosystem is quite different. Open APIs, the DevNet program, and a commitment to being open has created a much broader, stronger ecosystem that ranges from companies the size of Apple to thousands of smaller, "long tail" ISVs that add value to Cisco and create an additional channel to pull products through.

Over the last several years, I've described Cisco as an eight-cylinder engine that was firing on only four cylinders. Today Cisco's positions in security, collaboration, and wireless have never been stronger and, because of intent-based networking, the company has a great opportunity to take back share in campus networking and stimulate a refresh. Yes, it still has work to do in the areas of enterprise routing, service providers, and with Web-scale companies, but under Robbins the company has its swagger back.

Under Robbins' continued guidance, expect to see the strong innovation and execution continue. The bar is certainly set higher now, but he and his strong leadership team seem up to the task.

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