Let's Split Up Cisco

COMMENTS

Newest First | Oldest First | Threaded View

Norcal Router Guy 12/5/2012 | 5:05:52 PM

re: Let's Split Up Cisco

Good stuff, Phil.  

This discussion reminds of similar discussions about unlocking value with Microsoft. These are bold strokes.   But the current leadership will never do it.  They have dreams of being the GE of networking.   I believe breaking up Cisco will only happen if Chambers moves on.

Shedding SA makes a lot of sense, mostly because it's rudderless like Motorola. Videoscape is a nice future, but it's a 'hail-mary' play. I would seriously consider selling SA to Pace and calling it done.

 

Reply | Post Message | MESSAGES LIST | START A BOARD

ycurrent 12/5/2012 | 5:05:51 PM

re: Let's Split Up Cisco

All companies have unlocked value somewhere... but the discussion here is way off base.  If Cisco's multiple divisions were previously well aligned and delivering value, then the answer now is not to split the company, but to split the management, rather make them split.  Good management should be able to manage both the growth and the margin components of their portfolio and communicate that to the street.  Excel-based prognostications don't hold water.

Reply | Post Message | MESSAGES LIST | START A BOARD

DCITDave 12/5/2012 | 5:05:51 PM

re: Let's Split Up Cisco

Putting the Excel sheets aside, don't you think Cisco would be more effective as a company if it were focused on one customer set at a time -- enterprise, service provider and consumer?

Having said that, I'm interested in your thought about making the management split. Which section VPs do you see as not pulling their weight these days?

Reply | Post Message | MESSAGES LIST | START A BOARD

DCITDave 12/5/2012 | 5:05:51 PM

re: Let's Split Up Cisco

MSFT is a great analog for Cisco. I wonder if MSFT would have been faster to get its act together in mobility and Internet services if it weren't trying to prop up the Windows consumer desktop business.

Reply | Post Message | MESSAGES LIST | START A BOARD

ycurrent 12/5/2012 | 5:05:51 PM

re: Let's Split Up Cisco

I think there is a difference between managing a diversified portfolio company and managing a company with a broad portfolio and customer set.  Should Verizon split into wireless, wireline and business?  If Cisco were to ask its managers to focus on 1 customer set at a time, then they should all take deep pay cuts. 

More importantly, if ideas and technology can cross-pollinate between service provider and enterprise, such as data center approaches, etc., then separating the company would eliminate this potential, (and likely lead to the re-acquisition at some future point anyway.)

As for management, I think the oversight at Cisco has been its top-heavy perspective.  For how long has Cisco talked about countless "adjacent market opportunities."  They were so ill-defined, no wonder the company stretched too far waiting for them to materialize.  Managers with a bottoms-up perspective should help correct the course.

Reply | Post Message | MESSAGES LIST | START A BOARD

DCITDave 12/5/2012 | 5:05:50 PM

re: Let's Split Up Cisco

I don't know about Verizon but you make a compelling point about getting ideas to flow freely between the enterprise, data center and service provider groups. Is that happening now? I should know but I really don't.

Also, would you concede that Scientific Atlanta is sort of an odd man out? Shouldn't they at least divest that business and concentrate on other cable opportunities?

Reply | Post Message | MESSAGES LIST | START A BOARD