Cisco CEO John Chambers in 2009. Credit: IDGNS San Francisco
Chuck Robbins is officially the chief executive officer of Cisco, but that doesn’t mean he’s totally in charge.
Several sources inside and outside of Cisco say the company’s star engineers and key innovators – Mario Mazzola, Prem Jain and Luca Cafiero – continue to report to former CEO John Chambers, who became the executive chairman of Cisco July 26 when Robbins succeeded him. The three, along with marketer Soni Jiandani, founded three companies funded and then acquired by Cisco under its “spin-in” model to insert it into new or disruptive markets, like storage area networking, data center switching and SDNs.
That “MPLS,” as they are informally referred to, still report to Chambers and not Robbins signals that Cisco is not willing to part with the status quo when it comes to product development vital for the company’s growth and account retention. The spin-in model of innovation has been highly successful for Cisco, reaping the company billions in sales and profits, and helping to stave off incursions into its incumbency from traditional and start-up rivals.
Indeed, MPLS and the Insieme Networks business unit they most recently founded were exempt from the sweeping engineering reorganization spearheaded by Executive Vice President and Chief Development Officer Pankaj Patel last fall.
But it also indicates that Cisco may insulate certain operations from Robbins for a defined or indefinite period until the board of directors is fully confident in his ability to lead the entire company.
“Perhaps it’s just a temporary arrangement as they prepare to retire or create another spin-in, but it certainly creates ambiguities about the (CEO) transition,” says one source familiar with the arrangement. “I wasn’t surprised that they didn’t want to get swept into the mainstream engineering and marketing organizations, but not reporting to the CEO raises questions about who really decides about innovation investments.”
Cisco said it would not comment on its organizational structure when asked about the reporting arrangement for MPLS. It chose instead to crow about the progress of its Nexus 9000 and Application Centric Infrastructure (ACI) product lines, the most recent developments from MPLS.
“The ACI portfolio is doing great,” a Cisco spokesperson stated in an e-mail. “It’s one of the fastest ramping technologies in Cisco’s history. We’re proud of what that team has already achieved, and it’s only the beginning. Last quarter, ACI revenues grew 53% quarter-over-quarter and 100% year-over-year.
“We have no comment to make about our internal organizational structures.”
Chambers is reportedly now an evangelist for security at Cisco so if MPLS are working on another spin-in under Chambers, it could have a security focus.
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