Cisco sees the future, an interview with John Chamber-Summary

It seems that there is no period of economic contraction that Cisco could not overcome. Thanks to CEO John Chambers and his leadership team, the company has demonstrated it could handle various downturns, predict the future trends or recognize market transitions before its competitors. The article gathers two interviews of Chambers in order to identify the combinations of conversations and the processes used by the CEO and his team to foresee trends, even in a highly volatile market, and rapidly capitalize on these market shifts. We’ll see that this seemingly ability to predict the future has nothing to do with luck but rather with an outstanding sense of leadership and a different way of think about what a company should be.
Chambers first talks about the importance of identify market transitions. Indeed if a firm is able to do it, it will be given the opportunity to take a new market share or move into new market proximities by being the first to match customers’ needs. The difficulty lies in the fact that it takes a lot of time to reach a certain amount of revenue when a company launches a new product. More, the organization has to develop the product before launching it. That’s why to capitalize on a market transition a firm must recognize it eight or so years before. This highlights the rehearsal performance of Cisco.
Early on, Chambers learned to sense market transitions by listening closely to customers, connecting individual dots of behaviour into patterns that indicated future trends. That’s how he predicted in mid-1990’s that voice would become free and saw a big opportunity to build voice over IP networks and extend these services into the home. Even though some thought Chambers was trying to destroy telcos business model, he stayed confident about his beliefs and tried to build strong relationships with telcos rather trying to compete with them. Cisco’s CEO furthermore explains why he believes that listening closely to customers’ clues is one of the main key for a company’s success by foreseeing future market shifts. Rather than focusing only on competition, he regularly met with customers who are likely to have more frontline knowledge about technologies in action and could drop hints about shifts in the demographic or economic picture or other trends. This way, it could help the organization identify the market transitions several years before they occur and thus capitalize on them by starting to develop the offerings before the competitors. Processing like this really matters because market transitions are no longer driven by business but rather by customers (especially in some places like China or Indian where young people are enjoying new technologies and innovation more than anywhere else).
In the following part, John Chambers describes how Cisco handles unusual economic conditions and how it can take the most of economic downturn by always finding new opportunities. For instance, during the Asian crisis in 1997, all Cisco’s competitors were eager to cut back their resources in these areas whereas Chambers decided to send more senior executives, increase resources than he did in the past and thus expand Cisco’s presence in the region. For sure it was risky, but according to the firm’s results in Asia, no one can deny that this strategic move was worth it.
Then, Chambers explains that he believes the next biggest shift in the market is the network-centric world which means a more collaborative world, a world where every customer could be constantly connected. More, Chamber forecast is that everything will follow a service model. For instance IT support, publishing, hybrid models of device would be offered as services. Lastly, he predicts that content provider will soon be able to meet consumer’s needs more precisely and make content directly find the consumer through their computer, smartphone or tablet.
All these forecasts seem once again to be a source of new revenues for Cisco, but one should not forget that each time a market is in transition, you can either gain or lose market share. According to Chambers, if there was a time that they lost market share, it was because they moved too slowly. He realized he needed to turn Cisco's management processes upside down to benefit from that foresight. Cisco’s CEO describes how he was able to surrender his role as a command-and-control CEO and institute a collaborative decision-making model that allows the company to respond speedily to those emerging transitions. Chambers believes that organizations should explore opportunities to improve collaboration in order to capitalize on the collective expertise of their employees. To make it possible, he developed systems inside the organization aimed at foster the collaboration between employees. For instance, Chambers created TelePresence, an ultra high definition videoconferencing system enables realistic meetings with life-size and perfectly clearly hearing without delay. This tool makes people in other part of the world feel like they were in the same conference room than you, and thus makes debate and decisions easier. Obviously it takes more than just a videoconferencing system to develop collaborative management in a company. Chambers explains he started using a collaborative model (putting some people with the same language and the same objective together, with a leader to drive the team through execution) even though most of the employees didn’t really enjoyed this experience. He forced them to work as a team regardless if they would get along or not. Cisco’s CEO was uncompromising about collaboration and top managers who were not able to collaborate efficiently had to leave the company. Managers throughout Cisco now form cross-functional teams, working together to identify and exploit new opportunities quickly. The model allows Cisco to simultaneously implement 22 major sales initiatives as effectively as most companies do one or two.
To conclude listening to customers and adopting a collaboration model are the tenets of Cisco’s ability to forecast future trends or market transitions and quickly to it. This way the company doesn’t miss an opportunity to grow and get a step ahead its competitors. In 14 years Cisco has enjoyed outstanding results thanks to unbelievable John Chamber’s energy and love for challenges. This motivation and competitive spirit has help him building his leadership and thus to be so respected among his company employees and peers.
John Chamber is another model of leadership through his actions and thoughts. He quickly understood that developing collaboration model would make the company works more efficiently. This is a lesson that we learned many times in the previous articles and during the classes. Indeed, a good leader must not focus only on himself but mostly on his employees. Making them work together enables Cisco to take a lot of initiatives in the same time. Actually I can’t deny that working as a group could be very effective but sometimes I feel as I could do the work by myself more efficiently. When for instance I have to work with people who are quite reluctant to work, or who don’t really master the subject studied, I don’t really enjoy working as a team and the ending result may be worst than if I had done it by myself. I’m probably wrong because as we saw in this article, Chambers forced his employees to work together even though they don’t get along well and the result is convincing. Anyway I experienced some bad results in my French business school where each team member was quite individual so the group was not working as well as expected. I guess that’s why we have so many group projects, to learn how to work as a group no matter the members and be able to go through individual expectations and beliefs to reach a target.

Chambers proved he was cleverer and found the key for being better than its competitors. Indeed, he understood he has to listen carefully to customers’ expectations and this way he’s aware of the likely market shifts. That’s a leadership skill that being able to think differently even though people doesn’t share your point of view. He found the balance between listening to his peers/employees/customers but also his own beliefs, that’s what made him so successful. As all leaders studied in the previous case, we notice that John Chambers his 100% devoted to his company and the market. Once again it’s one of the main things to get how your business market works and make the good choices for your company.

Last, the article tells us he used his personal experiences in his young life and made a parallel with business environment which helped him to make the good choices. We all managed one time in our life to go through tuff periods. One must be able to remember how he managed to overcome these difficult times. Usually in daily situations, one of my qualities is that I always try to stay calm and master my stress. I try not letting feelings and emotions take control. During my internships, I went through several stressing situation and I think that what I was trying to do in my daily life helped me a lot.