Cisco's Reorg: What It Means

Cisco looks to be putting on a more serious customer face as it puts a marketing specialist in the CTO chair

July 15, 2004

5 Min Read
Cisco's Reorg: What It Means

So what's up with the big changes in Cisco Systems Inc.'s(Nasdaq: CSCO) top management team?

Well, lots. Cisco on Tuesday night craftily announced a reorganization of the top management in its technology division, as well as appointing Charlie Giancarlo as the third CTO in Cisco's history (see Cisco Reorgs, Names Giancarlo CTO) -- at exactly the same time as Juniper was announcing its second-quarter earnings (see Juniper Surprises With Q2).

It's a big move for Giancarlo, because he's not just assuming a new role as CTO -- the promotion is effecting big changes in the reporting structure. Giancarlo is now perceived as the big Number 2 to the boss, Cisco CEO John Chambers, to whom he now reports. Before, he reported to Mario Mazzola, senior VP and chief development officer.

In other words... Giancarlo's moving up, big time.

Being been handed one of the most visible roles in the networking and telecom industries should put to rest rumors that Giancarlo was weighing opportunities at Broadcom Corp. (Nasdaq: BRCM) and other companies.

Giancarlo has held a number of broad management roles at Cisco, but he has never held a CTO title before, nor has he been considered the top technologist in any particular discipline -- a sign that Cisco views the CTO role as more of a marketing role than it did in years past. Sources say that Giancarlo is know for his skills in marketing and handling relations with big customers, and several sources say Cisco is defining the CTO role in terms of customer relations.

In 1999, Giancarlo was given charge of Cisco's vast Small-to-Medium Business (SMB) line of business. In 2001, he took charge of four of the 11 technology groups that reported to Mario Mazzola as Cisco went through one of its largest reorganizations ever.

"Charlie has been a big contributor to the technology and business strategy for more than 10 years with Cisco," says Cisco spokesman George Paris. Paris says Giancarlo will be more "externally focused," meeting with big customers and expressing Cisco's technology vision. Mazzola, on the other hand, will have more of a day-to-day involvement with Cisco's development and engineering groups.

Like his predecessors, Giancarlo will have to lead Cisco's "visionary" camp, acting as counterweight to the "pragmatic" side that focuses on quarter-to-quarter results, says Frank Dzubeck, president of Communications Network Architects. "He can be extremely challenging and extremely persuasive in his arguments."

Giancarlo's predecessors, by the way, were Ed Kozel, who was Cisco's CTO from 1990 to 1998, and Judy Estrin, who held the post from 1998 to 2000.

In addition to his CTO responsibilities, Giancarlo will continue as president of Cisco's Linksys division, and he'll assume responsibility for the company's global government solutions group.

Table 1: Cisco's Technology Groups

Aug-01

July-04

Cisco's Billion Dollar Markets*

Access

Data Center, Storage, Switching, and Wireless

IP Telephony

Aggregation

Internet

Networked Homes

Cisco IOS

Mid-range & Stackable Switching

Optical Networking

Core Routing

Network Management

Security

Ethernet Access

Optical and Broadband Transport

Storage

Internet Switching and Services

Routing

Wireless LANs

Network Management Services

Security

Optical

Storage

Voice

Wireless



Cisco's technology group also went through several other changes, some announced, some kept quiet, and some unknown.

In the kept quiet or unknown department:

  • Cisco has acknowledged that Larry Birenbaum, senior VP of Cisco's Ethernet access group, has taken a leave of absence. His title, for now, hasn't changed, but there's no word on when he'll return to the company.

  • It is unknown what's in the cards for Roland Acra, the Procket CEO who has stated that he won't stay with Cisco for long after Cisco's acquisition of the company is complete. Would the shuffling in Cisco's upper ranks change his mind?

Here are the other changes Cisco announced this week:

  • Jayshree Ullal, former head of Cisco's optical networking group, was given charge of the company's newly formed security technology group. She'll continue to report to Mazzola.

  • Luca Cafiero, another of Cisco's employees who came out of Crescendo, has been tapped to lead Cisco's new data center, storage, switching, and wireless technology group, which also reports to Mazzola (see Crescendo Corps Soars at Cisco).

  • VP Tony Bates has won sole responsibility for Cisco's carrier core multiservice business unit, which does… well, not quite sure yet. Anyway, the group reports to Prem Jain and Mike Volpi.

  • VP Kathy Hill is now in charge of the new mid-range and stackable switching technology group, which reports to Mazzola. No word on whether a long-range and unstackable switching group is also in the works.

  • Kambiz Hooshmand, VP and general manager, is now leading Cisco's optical and broadband transport technology group, which also reports to Mazzola.

All changes announced are effective August 1.

So is that the end of Cisco's deck shuffling? Probably not. Some observers say Chambers has just gotten started, as he suits up Cisco with a more mature corporate look to prepare for new growth areas. "I think there's more to come," he says. "This is just a start."

— Phil Harvey, News Editor, Light Reading

( Craig Matsumoto, Senior Editor, Light Reading, contributed to this article)

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