John Chambers from West Virginia gets it in ways most people in Silicon Valley -- and many places in between -- don't yet. I may be the kind of person easily charmed by powerful salesmen -- and make no mistake, if John Chambers is nothing else, he's that -- but I'm convinced this mover of markets and shaker of industry is yards ahead of the rest of us.
Who am I kidding? This is a CEO with a track record Michael Johnson on steroids couldn't live up to. Saying that John Chambers gets it is like saying your spouse owns you: You can argue the point, and you may not like it, but the facts make it a foregone conclusion. Don't rough up the messenger.
Chambers took what was already a great engineering company; shellacked it with the carefully crafted veneer of a largely unrivaled marketing and sales organization; took advantage of remarkable boom times with an acquisition strategy, pace and execution to make Napoleon look like a short-sighted lackey; then out-slugged and outlasted nearly every rival around. That much is a matter of record, as are profit margins that would bankroll a few third-world nations, 11 quarters of sequential growth, blah blah blah.
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But 2001 revealed a new side of Cisco. While the world wept about a stock price not even the company's worst critics could fathom (down to $11.04 in September from a five-year high in March 2000 of $82), Chambers saw earnings and productivity dip dramatically. He joined the rest of us in realigning costs, to the tune of thousands laid off and a far less hasty acquisition pace.
Meanwhile, Chambers has been quietly attempting to return the company to its roots on the engineering and technology side while getting back to basics on the business side. "Profits, cash and productivity," he is wont to say, as if giving directions to the dairy aisle at Piggly Wiggly. There's no doubt Cisco dominates its market as a solutions company and business force, and if it's truly turning its attention back to the technology, that will be a refreshing message coming just in the nick of time.
I won't put too fine a point on it, because the company hasn't lost any of its slick veneer. The organization still talks about concepts being part of the "Cisco DNA," and someone actually holds the title "VP of Market Positioning." However, there is less bravado about acquisitions and more talk of partnerships. There's less fanfare about unheard-of margins and more taking ownership for failure: "We got knocked on our tail," Chambers told an audience of financial and technology analysts at a December conference, where I had a chance to sit down with the CEO face to face.
Chambers is always compelling. His conviction is unmistakable. One of his themes has been CEO as survivalist -- CEOs typically last an average of three years, he says. Chambers has been around seven. Because he has survived, and because he's built such a successful, profitable business, the CEOs of his customers, bent on survival, listen. After all, what he has to say is music to their ears, and when Chambers talks about how Cisco technology can do for them what it's done for Cisco, how can they not be swayed? I am.
The problem is, it's not the CEO who decides to buy the Catalyst switch or the PIX firewall or the IP phone. Chambers gets that he must deliver to IT the message that Cisco is a technology company as much as it is a business force. Nobody has ever found his ability to deliver a message wanting, but the crucial test will be whether the rest of Cisco gets it, and ultimately whether you, the IT professional, gets it.
You Had Me at 'Hello'
Chambers gets the message all right, and he made me a believer as well. Two years ago I met with him while conducting a series of interviews with the CEOs of four rivals in the infrastructure space: Cisco, Lucent Technologies, Nortel Networks and 3Com Corp. He reminded me of that interview this time as I sat down with him in his suite after a long day of meetings and announcements that sent the technology market into a heart-warming holiday uptick. As he grabbed a bottle of water for me, he took his shot: "The other three [CEOs] are gone. Which ones are you interviewing now?"
When I interviewed Chambers two years ago, I impishly asked him who would win in a fight between him and then-Lucent CEO Rich McGinn. He begged off with a speech about the nature of competition and how it makes you stronger and so on. ("It is highly unlikely that I would ever be driven to get into a fistfight with any of my professional competitors," he answered then.) This time, I asked him whom he'd rather drive cross-country with: Juniper CEO Scott Kriens or Bay-area baseball brat Barry Bonds. He chose Kriens in an instant, but then started down the speech path again.
All right, maybe Chambers doesn't always get it. So as I walked to the elevator with Rob Barlow, Cisco's long-time PR stud, I said, with all the seriousness I could muster, "I've got my headline. 'Chambers Hates Barry Bonds.' " Hey, he may have gotten me with the "Where are they now?" thing, but payback's a bitch, eh?
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