What Will Cisco be Like after Chambers?

Empty MicrophoneJohn Chambers is an institution at Cisco having joined the company in 1983.  He has been the CEO of Cisco since 1995 and has been Chairman of the Board at Cisco since 2006.  He is an engaging, passionate speaker who captivates large audiences.  However, all institutions come to an end and given the rumors swirling around that Chambers will soon resign from Cisco, it is time to ask the question:  How will Cisco change under new leadership?

Of course, one viable option is that the person who replaces Chambers will be a clone of John.  Since John, both in his role of CEO and in his role as chairman of the board, will likely have a lot of influence over the selection of his successor, that is a very viable possibility.  If that does happen, then probably not much will change when Chambers leaves.

But, what if that doesn’t happen?  What if John’s replacement doesn’t feel the need to stay the course?  What if John’s replacement feels that s/he has an opportunity — and possibly a mandate — to shake things up and take the company in a new direction?  Let’s assume that happens and let’s refer to John’s replacement as the anti-John.

If there is an anti-John, then one of the biggest short-term changes to Cisco post Chambers is likely to be to the company’s senior management team.  Most of the members of this team have been with John for a very long time.  Those that feel particularly comfortable working for John may not feel comfortable working for the anti-John and will choose to leave.  It is also highly likely that the anti-John will want to reshape the leadership team to better take Cisco in the new direction that they are forging.  The bottom line is that if indeed there is an anti-John, here will likely be significant changes to Cisco’s senior leadership team and those changes will occur quickly.

With companies such as Google getting into the business of providing transmission services and Facebook planning to offer a top of rack switch, would the anti-John want really shake things up by competing head-to-head with companies such as Google and Facebook?  My take is that if any candidate to replace John even remotely suggested that course of action during the interview process, they should be shown the door.  Google and Facebook have a very different corporate culture than Cisco does and as Peter Drucker once explained “Culture eats strategy for breakfast”.  Sure, the anti-John may want to leverage their new leadership team to change Cisco’s corporate culture to enable Cisco to become more of a digital business, but that is a multi-year activity.

An interesting precedent for what the anti-John might do is what Gerstner did when he became CEO of IBM in 1993.  Gerstner is widely credited with changing the IBM culture, maintaining an emphasis on offering integrated solutions and refocusing the company on providing professional services.  Over the years John Chambers has been reluctant to develop a large professional services organization.  The anti-John, however, may look at having a large professional services organization as a way to develop new revenue streams and also as a way to better compete with IBM.

Speaking of IBM, how about a headline grabbing step such as merging Cisco and IBM?  Unless the anti-John comes in with that as a mandate from the board of directors, that is very unlikely to happen.  An acquisition is more likely.  As long as Cisco has a workable relationship with EMC I doubt that Cisco will buy NetApp.  On the other hand, for the last couple of years John has been talking about making Cisco into more of a software company.  If the anti-John shares that goal, acquiring Citrix could make a lot of sense.  The rumor that Cisco may acquire Citrix has been around for a while, in large part because the two companies already have a good working relationship, their products are largely complimentary, and they both have a major presence in the San Jose area.

How about a really crazy idea?  What if the anti-John brokered a truce with VMware and, as part of that truce, the two companies aggressively looked at where they could partner?  Yes, given the level of hostility between those two companies that seems like a very crazy idea.  But is it?  The anti-John and the new leadership team might not have the same resistance to the idea as would Chambers and the current leadership team.  From Cisco’s perspective, at least, making up with VMware is less risky than making a major acquisition would be, and it would have a more immediate impact on revenue than attempting to enter new markets or trying to change the corporate culture.  Again, I admit this is a crazy idea, but we may have seen this movie recently — it’s fair to say that over the years that Microsoft and Apple haven’t been the closest of friends, but the month after Satya Nadella replaced Steve Ballmer as CEO of Microsoft, Microsoft announced that they would release some of their Office applications for Apple iPad owners.

So, what do you think?  If Chambers does resign this year, will his replacement be a clone of John or the anti-John?  If it’s the anti-John, what changes do you think he/she will drive?  What changes would you like to see him/her drive?