Cisco must take its head out of the sand if it is to keep its best staff

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Cisco Systems Austin  Building 4

Cisco Systems Austin Building 4 (Photo credit: wesleyt)

Cisco has been the biggest name in networking for as long as I can remember. It encompasses the old "never get fired for buying" adage more than IBM and I can barely think of a business who doesn't use at least one bit of kit from the Silicon Valley giant.

Although over the past two decades there has been a few notable rivals in the networking world, it was never the coolest or sexiest area of technology to get involved in. Start-ups liked to focus on what they could do on the end of the network, rather than making it work better in the first place and Cisco continued to grow its loyal, if not reliant, customer base where others feared to tread.

But in recent years there has been a somewhat subtle but still notable change in attitudes towards networking. As the internet and cloud computing have become more imperative and new generations of start-ups have been inspired to create services putting everything from HR spreadsheets to holiday photos in external datacentres, the importance of the network has grown.

Where people use to blame the application for running slowly or the device they were using, even the less technical of employees can identify when it's a network issue, from smartphones to the office Ethernet, having more awareness than ever before of what is powering things behind the scene.

This has led to a surge of even fresher faced, brighter thinking new companies who want to leave the end points to the guys from the 2000s and spend the 2010s on the software and hardware getting them working.

Never has there been such a thriving networking industry and it is unsurprising the industry is thinking Cisco is scared.

The one emerging technology on everyone's lips is software defined networking - decoupling the hardware layer from the control plane, giving much more control, flexibility and real time reactions to traditional kit. One of the keys to the open standards that are being developed is the software will be the key component and capable of running on a number of hardware vendor's equipment.

Essentially, the hardware Cisco has kept companies signed up to for so many years will become a commodity product.

Cisco has publically attempted to embrace SDN with its Cisco ONE strategy but those who understand the technology see it as a copout, still trying to convince customers you need hardware AND software from Cisco for it to perform the best - something that goes against the whole ethos of what SDN is.

But, why would Cisco be scared? Yes, there are more companies than ever before and yes, they may not be embracing the new trends as quickly or positively as others, but they are still the big guns with the market share and it is far too early for the SDN technology to make any impact on that.

Well, the reason the big boy should be nervous is its talent is jumping ship and getting into bed with the young upstarts, bringing their expertise and experience from the legacy company to a more enthused and innovative setting, backed by a lot of venture capital.

The latest casualty for Cisco is Prashant Gandhi. He was responsible for development of SDN products at Cisco but has now left to become the vice president of product management at one of the hottest companies being talked about in Silicon Valley right now, Big Switch.

This comes less than nine months after the overall head of SDN, Tom Black, also turned its back on Cisco to take up a position at new start-up Atista Networks.

Both these departures have been a major blow to Cisco publically as it seems to show those who really know what they are talking about with SDN are looking to the open innovation of the newer firms than the traditional clinging on to market share of older companies unwilling to accept a future where they can't tell the industry what to think anymore.

And it is hard to believe there isn't a lot of fear inside the San Jose HQ as well, wondering how they can keep hold of their talent and dominant position in a world where the network is changing. In the lower down ranks, there may even be questioning of whether 18 years is too long for a CEO to be in his position.

I don't believe they can hold onto the number one spot. The fact is the networking market will be shared between more players than ever before and have a new focus that Cisco is unlikely to be the best at.

What it can do is stay relevant. I think the company needs to stop focusing on acquisitions and start allowing its own engineers to take that cash and throw it into R&D. This way it could attract some of the younger generation coming up in the Valley right now and come up with some technology that could keep it in the game.

But it must let go of the past. Yes, SDN is someway off of becoming a mainstream technology, but it will get there and it is up to Cisco whether it is still running around with a pad and pen pretending time hasn't moved on or whether it has a team of youthful, excited professional bringing their talent and enthusiasm to the table.  

I just wonder how many executives and developers it will lose before it realises that. 

4 Comments

What a shockingly badly written article. Awful grammar, superficial analysis, factually incorrect statements and innocuous conclusion. Reminds me of those people who used to say that IBM mainframes were dead. May I suggest you do your research a bit more - this is not doing any credit to your online presence.

Spot on Jennifer. Cisco has no direction in SDN. Support of SDN and OpenFlow would force Cisco to forego big maintenance contracts with existing customers so there is a lack of support and investment. That’s why anyone associated with SDN is leaving.

Software Defined Networks go in easy. You build a template for one switch and apply it to all the others. That’s SDN. Cisco’s definition of Software Defined Networking positions SDN is a far off concept, then gently transitions into a description of their proprietary solution. It’s ridiculous.
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Cisco - Software defined networking (SDN) is an evolutionary approach to network design and functionality based on the ability to programmatically modify the behavior of network devices. Although still in its infancy, there is a great deal of optimism that SDN will make networks more flexible, dynamic, and cost-efficient, while greatly simplifying
operational complexity. Cisco has recently begun unveiling its open network environment, a broad vision around
extending network capabilities and extracting greater intelligence from network traffic through programmatic
interfaces. SDN is a component of this open network environment….a closely related aspect of SDN, the concept of Virtual Network Overlays, based on Cisco Nexus® 1000V, a virtual switch for multihypervisor environments. Through programmatic interfaces to the Cisco Nexus 1000V virtual supervisor module (VSM), Cisco will be enabling automation-centric provisioning of cloud infrastructures. The result is a dynamic and scalable way of building multitenant or hybrid cloud networks and massively scalable data centers that are optimized and operationally efficient.
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Cisco is under siege. The vendors that build SDN switches are taking market share from Cisco. Check out Gartner, it’s well documented. Companies are receiving significant cost savings and improved performance by switching from proprietary Cisco gear. All the open modern network protocols are available and the switches are easy to manage.

I know a CIO that had a proprietary Cisco network for 20 years. He replaced his whole layer 2 (300+ locations, 15,000+ end points) over the last two years with SDN switches. The new SDN switches cost him 6 Million and have a lifetime warranty. The Cisco switches he replaced would have cost him 25 million just for maintenance for the next 5 years. The management tools are better as well. The “Head in the Sand” title of this article is an astute observation. Cisco is acting as if OpenFlow and SDN have not already happened. Very strange.

Cisco makes little more than token efforts to hang onto its employees. For years, it has whittled away at benefits still enjoyed by many other large Silicon Valley companies (e.g., food, drinks, and celebrations), as well as finding ways to cut costs by passing on more medical expenses.

They also make little effort to accommodate the cultures of the companies they absorb. Most are told "we'll keep you independent," but that generally lasts until the next senior management shift change, with the next incumbent intent upon expanding his fiefdom and level of control. E.g., Cisco is closing the San Bruno facility that was, until recently, home of ultra-creative (and profitable) IronPort, forcing all of the employees there, many of whom are San Francisco-based, to commute down to the mothership in San Jose. Cisco also recently purchased Meraki in San Francisco, and they were given the same "we'll preserve your culture" line. And, of course, R.I.P. Linksys, Flip, and any number of acquisitions that did nothing for the employees they absorbed, much less the products.

Cisco's definitely a stable place to work, but well-funded start-ups are quickly stealing its thunder and talent.

Totally agree with your comment on Cisco. More examples like SA, and Webex acquisition. Any good products being acquired will be destroyed by Cisco. Well, NDS may be the next.

Cisco has no direction at all, their mind set is still keep selling boxes although they want to position themselves to sell "solution", service and architecture for over 10 years long.

The restructuring and low profile layoff nearly twice a year in APAC make the moral extremely low. 10 years ago, Engineer and Sales are so ambitious, but now.....The management is losing the direction. They all know the threat of SDN but refuse to face the challenge. It is because they think the bread and butter are pretty safe at this moment. Who cares what will happen next year?

It was once a great company.....

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This page contains a single entry by Jennifer Scott published on May 7, 2013 12:16 PM.

Tablets have no future? But the future is already here Mr. Heins... was the previous entry in this blog.

Wi-Fi in the US sky? Follow suit EU! is the next entry in this blog.

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