Temperance at Cisco

Thinking about having another soda on your 3 o'clock smoke break? If you work at Cisco Systems Inc.'s (Nasdaq: CSCO) San Jose campus, you may have seen signs that call upon your conscience to reconsider. A group inside Cisco has put up full-color, glossy posters in break rooms all over Cisco's campus, admonishing employees to help the company save money by drinking less and recycling more, sources say.

Like other big companies (especially in Silicon Valley), Cisco provides free bottled water, coffee, sodas, and fruit drinks for its employees (see A Return to the Kitchenentals). Now that the economy's hugging the commode, however, Cisco and its peers are discovering that such perks add up fast when one multiplies a few cents per soda by tens of thousands of employees.

(Another increasingly popular -- and daring -- cost-cutting measure being pursued by some Silicon Valley companies, such as Sun Microsystems Inc. (Nasdaq: SUNW) and Network Appliance Inc. (Nasdaq: NTAP): encouraging employees to take time off without pay.)

To nudge folks in the right direction, Cisco has printed and hung signs (on recycled paper?) that encourage conservation. The signs in Cisco's break rooms ask employees to "drink frugally" and "drink responsibly," sources say.

And don't operate heavy equipment.

According to a Cisco correspondent, one sign, with an accompanying chart, explains that each worker taking one less cold beverage per day could save Cisco more than $2 million annually.

The problem: In a corporation that traditionally has avoided luxuriant excess, some Cisco insiders feel that the signs add insult to injury, especially in light of recent budget cuts.

"In my group, people have been laid off, there are no raises for anyone this year, most employee stock options are under water, we have been moved from reasonable-sized cubes to mini-cubes, funding for training and supplies has been cut, meeting room sizes have been cut in half, etc. All are arguably reasonable actions, but it hasn't been good for morale," writes one employee.

To help ease the sting of such corporate crackdowns, some Cisco folks have put up a Web site that pokes fun at -- but doesn't protest -- the signs. The site, which was recently spotlighted on F*ckedCompany.com, suggests some other cutbacks, such as washing only one hand after using the restroom.

"I was just trying to lighten things up," writes one of the site's authors in an email to Light Reading. "Of course I would rather pay for drinks than try to find a new job."

The thirst suppressant signs are just an isolated -- and perhaps extreme -- example in a series of several internal adverts that encourage frugality at Cisco. In fact, Cisco employees contacted by Light Reading praise their employer for not being "draconian" in response to California's ongoing energy crisis. "They set the thermostat a few degrees higher and told us we could wear shorts -- mostly common sense stuff," says one Cisco worker.

"There are signs all over Cisco that encourage employees to act frugally in various ways," says a Cisco spokesperson contacted for this story. "So write frugally."


- Phil Harvey, Senior Editor, Light Reading
botermalujilly 12/4/2012 | 7:53:15 PM
re: Temperance at Cisco You don't have to be any more competence in sales to sell the Pirelli equipment than the Cerent equipment. The Pirelli long haul was the first 10G long haul system available; it has (had) its merits. However, you do need to know the equipment and the sales cycle for the system to understand the customer's needs and make the sale. The Cerent sales team knew their equipment. The sales cycle for the 454 is short (days to weeks). They sold tons of them and ran with the money, but the same sales team (who were tasked with selling the Pirelli system, because Pirelli had only a few salemen)had no incentive to learn the Pirelli system, because the sales cycle was so long (several months to years). They didn't want to spend time bringing a customer along in the process if they were not going to buy relatively soon. The Pirelli salesmen knew this, but were virtually ignored in the whole process. They were reassigned to sell the 454, and eventually all left.
Now you know the truth. Lack of sales is not the fault of the Pirelli equipment. It was the inability of the ONG leadership to understand or care about the product.
hype 12/4/2012 | 7:53:26 PM
re: Temperance at Cisco >flanker : smooze?

In a non-disclosed memo, Cisco has ordered that the "H" key be removed from employees keyboards, in yet another cost reduction scheme!!!!

Rumor has it that "Y" is next.... "Are You Read?"
horse of a different color 12/4/2012 | 7:53:28 PM
re: Temperance at Cisco It's only a matter of time before the ax doth swing again. You can't consolidate about 35 or so BU's into 11 and NOT have overlap and redundancy. Just look at the the number of VP/GM's and Directors. They can't find senior-level positions for all of 'em. I just hope that this next batch gets the same kind of package I did the first time.

I bet they don't.
sfleinen 12/4/2012 | 7:53:30 PM
re: Temperance at Cisco > recycle packets

set spendtree disable all
Telecom_Guy 12/4/2012 | 7:53:31 PM
re: Temperance at Cisco Well first of all, there are many many engineers in Cisco that are part of Sales. Look at where all the Cerent guys are. They were all once part of the Optical Networking Group (ONG) in sales. These were very sharp engineers that were selling the optical products. Sure eventually some slick willy type account sales managers were brought in. It is way easier to teach an engineer to sell than it is to teach a sales guy technical stuff. Selling is not that hard. Sure it is an artform, but it's not a hard one to learn. When I was at Cisco, the average account manager was making over $265,000 per year. The average system engineer in the sales organization was making less than 1/2 that amount. Well needless to say many of the good engineers left Cisco. There were some Cerent guys who stayed behind because of the stock options they still held from Cerent. So saying that the engineers couldn't sell at Cisco is just plain wrong. Maybe that was the case in their data groups, but not in the optical business.

And as far as the sodas went, I drank alot of sodas!!! Hey if Cisco was making millions of the stuff I was selling then a few sodas couldn't hurt. I knew people at cisco with multimillon dollar commission checks!! Yes those were the good ole days. Money was everywhere. No one would think twice about taking any customer to lunch, dinner, or whatever. Now they are pinching pennies. They should have thought about that before buying Monterrey, Qeyton, Pirelli. Now you know you have to be a good saleman to sell the Pirelli stuff. You have to be better than a used car salesman.
kj 12/4/2012 | 7:53:35 PM
re: Temperance at Cisco Just to add to the topic about salespeople and fuel the fire of irate engineers....

I live in San Diego and Cisco is currently holding a massive sales conference for its sales team. They actually blocked off a whole square city street to have a gigantic private party on Saturday and Sunday night in the middle of the downtown. There was a stage, live band, lights, food, tents, etc. Security didn't allowed me inside, but I walked by. You could hear the music about six blocks away.

I heard that there are 6,000 people here. I didn't know that Cisco had such a large sales force.

Gee, when's the last time any company sent its engineers away to party on all night for a week? I can't imagine what the sales team does when the economy is good.

Hey, you engineers, drink only one soda!
takeitlightly 12/4/2012 | 7:53:44 PM
re: Temperance at Cisco John the Don: " Roobbert- Make My Engineering team really Solid "

Sidekik : " Yes Boss! I will remove all the liquids from the f**S !!! "
dodo 12/4/2012 | 7:53:47 PM
re: Temperance at Cisco Metroman

Nicely articulated

creative influencers ( read BS) v/s honest techies

And guess who ends up holding bag when all the promises are not met and who is a star and is well compensated ( in addition to the sales comp) when the "John Hancock" is on the sales contract
metroman 12/4/2012 | 7:53:49 PM
re: Temperance at Cisco As an inarticulate engineer I completely agree with crapshooter's comments. As I have observed in my admittedly clumsy way, lucky as I was to have a sales person beside me, it is indeed the sales person who has sold almost all of the hardware that Cisco have ever shipped. The engineers have had almost none of the input into the sale as, if you are an engineer, and you don't work for Cisco, you will already have realised that their products are second rate.

Any engineer who feels he/she can influence a sale in Cisco is living in a dream world. That is why Cisco sell from the CEO downwards and offer financing and Jam Tomorrow as a technical solution.

This kind of selling does not work well in the SP market as they are looking for revenue generating features that will keep them afloat, not masonic handshakes in the boardroom. Those sales guys are priceless, who else could have sold IOS as a single seamless operating system, certainly not an engineer. Far too honest, and they probably would not have had the vocabulary to put it across.
crapshooter 12/4/2012 | 7:53:52 PM
re: Temperance at Cisco I can't comment on the salary of Cisco's salespeople because I haven't seen their individual sales volumes. However, I imagine that with overall sales as down as they are, they are probably not collecting much in the way of commissions or bonuses.

I find it interesting that many people cry that salespeople make too much. A company's sales department represents the front lines of communication to the customers and potential customers. There is an art to selling; most engineers lack the necessary communications skills and couldn't sell a cup of water to a man dying of thirst. Don't confuse an engineer's technical assistance with hard selling. When market conditions improve, it will be sales that brings Cisco and other companies back from the brink.
CiscoInsider2001 12/4/2012 | 7:53:55 PM
re: Temperance at Cisco Cisco has no option.

We are heavily banking on increased sales for Voice and Video (networking) eqpt.

So far the customer response has been luke warm at best. After some huge mistakes in optical investments (mistakes that became apparent this year) and also some stupid software acquisitions like Atlant... our bosses are finally waking up.

Still the question comes to mind - are these people competent enough to run Cisco?

Unfortunately, they were banking on employee attrition for further reductions - but obviously, no one's leaving!

Expect another "unexpected" announcement. I have been asked to name a few individuals in my department. So I am probably safe - for now.
_____ 12/4/2012 | 7:53:59 PM
re: Temperance at Cisco Chambers cutting his salary to $1 reminds me of the day when Craig Benson (Ex Cabletron) cut his salary to $53,000 per year. It's a real slap in the face to employees who work hard to support a family.

On a side note, I'm surprised Cisco's HR Department allowed the $1 salary given the fact that labor laws mandate employee's must be paid at least minimum wage for each hour they work.
flanker 12/4/2012 | 7:54:00 PM
re: Temperance at Cisco
eleanor 12/4/2012 | 7:54:00 PM
re: Temperance at Cisco if chambers and other execs got options this year, they are under water like everyone else's - and not vested either. and execs haven't gotten bonuses in 3 quarters. i think it is safe to estimate that chambers is living off of past gains right now and collecting zippo from the till at present. of course, it is also safe to say that past gains must have been whopping.

^Eagle^ 12/4/2012 | 7:54:01 PM
re: Temperance at Cisco Chambers could cash in more like 0.001% of his stocks and fund drinks for all Cisco for years.

If he cashed in 0.5% he could fund softdrinks for nearly all silicon valley....not just cisco employees!
^Eagle^ 12/4/2012 | 7:54:02 PM
re: Temperance at Cisco Folks,

I would be very very surprised to find very many Cisco employees working only 40 hour weeks. cisco has long been known for hard work and long hours.

However, I do agree that the sales team is WAY over compensated. I know sales guys in Austin who have made over 400k per year for several years in a row...who could barely spell MAN or WAN a few years ago. Just smoozers who let the field apps engineers and staff from the factory do all the heavy lifting and work for them. They just manage the relationship (really they smooze with the distribution channel...and do few direct sales themselves) and let others do the real technical selling. the Cisco FAE's are very very good and deserve to be compensated. But one could argue very strongly against the sales team making soooo much. And my Austin case is not isolated. Lots and lots of multimillionaires in Cisco sales. Do they really deserve to make more than double what the president of the US does....?

Cisco could nearly go cash flow positive is sales were compensated at more industry norms....like making a meager $200k!

The Carmack 12/4/2012 | 7:54:03 PM
re: Temperance at Cisco Before the layoffs, Chambers cut his salary to $1/year because it would save 8 engineers.

What about stock options?
viper 12/4/2012 | 7:54:04 PM
re: Temperance at Cisco He already has -- a few months ago he cut it to $1 per year. I don't know that any other executives have followed suit.
Lopez 12/4/2012 | 7:54:05 PM
re: Temperance at Cisco Why doesn't Chambers cut his own pay down to a third and ask the other execs to do the same! He gives lip service all of the time about how valuable his employees are and that Cisco's strength comes from its people. Hell, his salary alone could feed Somalia.

Before the layoffs, Chambers cut his salary to $1/year because it would save 8 engineers.

Learn the facts.
bear 12/4/2012 | 7:54:05 PM
re: Temperance at Cisco Why doesn't Chambers cut his own pay down to a third and ask the other execs to do the same! He gives lip service all of the time about how valuable his employees are and that Cisco's strength comes from its people. Hell, his salary alone could feed Somalia.
AsicGuy 12/4/2012 | 7:54:06 PM
re: Temperance at Cisco The ironic part was actually that the poster
was printed in such a fancy fashion. Some
friend was telling me that he saw another poster
printed on a regular paper says:

"If we use this poster, we save $50,000 right
away. "

Actually I like Cisco and think "think twice when
drinking" message it self is OK.

skarz 12/4/2012 | 7:54:13 PM
re: Temperance at Cisco I turned down a job at CISCO....no Grape soda in the frig...just cola, limit: one per day.
metroman 12/4/2012 | 7:54:14 PM
re: Temperance at Cisco Perhaps Cisco could save money by:

Not putting up as many posters
Not allowing employees access to message boards
Buying the stock of companies with a future and a full refrigerator

CSCO is losing the plot. I guess though that they have always sent packets frugally so it's not so much of a change.
horse of a different color 12/4/2012 | 7:54:18 PM
re: Temperance at Cisco As a former Cisco employee who ended up on the chopping block, I saw a question to the execs prior to the big layoff about cutting out the free drinks as a cost-cutting measure. The answer was a distinct NO... they didn't want to impact the "Cisco culture".

I don't know about you, but the fact that they were willing to keep the free drinks at the expense of laying off good people in a VERY bad job market still leaves a bitter taste in my mouth.
tsat 12/4/2012 | 7:54:18 PM
re: Temperance at Cisco oh please!

Maybe you are working too hard to notice,
but there is a massive disparity between
the tech-worker Haves, and the tech-worker
Have Nots.

Cisco has made some people very rich.
And how do they repay the not-so-rich folks
who dedicate their very lives to the continuing
success of the company?

Cutback on sodas?.

Why doesn't Chambers cash in .5% of his
options and start the Free Soda Foundation?
Sounds like a worthy cause to me...

respond 12/4/2012 | 7:54:18 PM
re: Temperance at Cisco When this stry make top news, market is hit bottom! No news for up. no news for down. I feel better already.
optical_guy 12/4/2012 | 7:54:19 PM
re: Temperance at Cisco I don't know what kind of environment you folks think you are talking about. I don't work at Cisco, but I have worked in telecom for the last 12 years....just what 40 hour work weeks are you folks talking about.

Let's look at it from the employees point of view....remember them, the folks who did not necessarily have a say in the billions and billions that Cisco spent on non-productive acquisitions. Who did not run up enough inventory to choke the economy of an average third world country. These are the folks who built the company, they are the ones that will suck up the hard times and cut backs, and you want to begrudge them a free soda at 10:00pm in the office and tell them to work harder.

Please....you want to bang someone at Cisco, try their exec.s
whose 12/4/2012 | 7:54:20 PM
re: Temperance at Cisco recycle packets
egowatcher 12/4/2012 | 7:54:20 PM
re: Temperance at Cisco What Cisco is doing makes sense! If all those who drink free soda and juice and other stuff look at their personal budget or behavior with their own personal money, I know that you would find that most of them are frugal and sacrifice soda and juice for water to save a few pennies. Budget crunch applies to every thing including a business entity. Look at all the Hondas on San Tomas and 880 and 101. Why did not they all go for BMW, MB and LExus?
======= 12/4/2012 | 7:54:21 PM
re: Temperance at Cisco Being a member of the bottom 0.05%, I need to be told on a minute-by-minute basis as to what I need to do. If it were not for the reminders I put in Outlook (e.g.: inhale/exhale, eat, etc) I might have had to go work at Noretell.
_____ 12/4/2012 | 7:54:22 PM
re: Temperance at Cisco This message was posted on the Cisco Frugal home page (cemments section) mentioned in this article:

22. "Keep the janitors from calling the mother country and save 200K /month"

Pretty low if you ask me. Bet the janitors have been more productive than the cisco employee's.


downreading 12/4/2012 | 7:54:23 PM
re: Temperance at Cisco And play a little less games...
_____ 12/4/2012 | 7:54:23 PM
re: Temperance at Cisco And people wonder why the stock is in the frugal $hitter?

Maybe the 40 hour per week employee's should work a little harder and complain a little less...
flanker 12/4/2012 | 7:54:24 PM
re: Temperance at Cisco Cisco's problem isnt the oj, its the bloated sales staff.

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