UK exclusive: Outgoing Cisco leader talks candidly about his successes, failures and expectations for the future.
John Chambers led Cisco through the ‘perfect storms’ of the advent of the internet, the dot-com bubble and the 2008 financial crisis. Now, just as the next big trend is kicking off, he’s stepping down. In a UK exclusive, Chambers spoke with CBRonline.com.
– Why he’s stepping down as CEO now
"That’s the time you make the transition, as you get to the inflection point."
– What makes a great leader
"Innovation and leadership is about a company’s ability to reinvent themselves, reinvent their leadership team and to reinvent their CEO."
– How Cisco has outlasted its competitors
"Great companies like Nortel, Lucent, Alcatel, Siemens…are a shadow of what they were before."
-Where he’s putting his money in the future
"Every industry will become Uber-like."
– How Cisco will win in China
"The progress is going the right way in China in terms of the overall direction."
– Which emerging markets to watch
"If I were betting on emerging markets now, I’d probably say bet on India first and Mexico second."
– His role as Chairman
"We studied why most high-tech transitions don’t work; it’s where the chairman stays around and helps the CEO too much."
– Upsetting the telcos
"It wasn’t just voice that will commoditise and be free. Data transport will commoditise and be free…"
– His predictions for the future
"Did I have doubts 20 years ago about the role of the internet, or today about the next generation of the internet being around digitisation? I have no doubts."
Chambers on why he’s stepping down now
John Chambers was asked whether he regrets stepping down now – at a time when, by his own admission, the trends he is most excited about are set to accelerate?
"The first generation of the internet brought the world closer together, changed the way we lived, worked, learned and played and gave every citizen of the world a chance to participate in the economic future. This next generation of the internet, this digitisation world, connecting five hundred billion devices will have five to ten times the impact the first generation of the internet did.
"So we are at one of the most exciting times and what Cisco’s done very successfully over the years is see when these inflection points would come and get ahead of them three, five, seven years ahead, such as the internet of everything, such as the transition towards security, such as architectures, such as convergence.
"We are at the key inflection point and I knew literally three years ago that I would take us out of the question at that time and position us very well for the future. Then you needed a new generation that would be willing to make a minimum commitment of three years, probably five to ten, if they do as good a job as I’d expect to take the company to the next level.
"That’s the time you make the transition, as you get to the inflection point. Are we at the most exciting time in the history of our company? Probably. Do we have a chance to become the number one IT company? A very good chance. In terms of our critics in the marketplace, we have none.
"I have zero regrets [about stepping down] and I’m so excited about our family. Chuck [Robbins, incoming CEO] and I trust each other completely and I will transfer that baton to him and be a great strategic advisor and I’ll work about half time. If you work full-time you probably get in his way too much. This way I’ll be his partner."
Chambers on leadership
There are now very few CEOs in the tech industry that have led their companies for the same length of time as Chambers. Microsoft’s eccentric Steve Ballmer retired in early 2014 and left the board later that year, while Larry Ellison of Oracle left the CEO role in September. Reflecting on this, Chambers commented:
"I think innovation and leadership has nothing to do with age. Innovation and leadership is about a company’s ability to reinvent themselves, reinvent their leadership team and to reinvent their CEO. We’ve shown the capability to have done that over the last twenty years, I would argue, more effectively than any other company in the high-tech industry, and we’ll make this seamless transition between Chuck and myself the example of how high-tech transitions should occur.
"First of all, most companies almost never stay on top for more than ten years. All of our competitors from fifteen to twenty years ago are gone, and from ten to fifteen years ago, [there’s] only one left…from five to ten years ago, great companies like Nortel, Lucent, Alcatel, Siemens, are a shadow of what they were before. Companies that two years ago were together – you were worried about an HP, VMware, Arista, other players, an Alcatel-Lucent that was gaining momentum – we’ve pulled away from them again. So if you watch, leadership is not about a generation. Leadership is about reinventing your company as market transitions occur.
"I would argue that we’re a role model for that and you’ll see if we do the CEO transition as smoothly as most people feel we’ve done today. If you look at CEO transitions, it was very well understood, it was very transparent and done with classic Cisco crispness in approach. So I think great leaders know how to reinvent their company, their leadership team and themselves on a regular basis. That’s true whether you look back ten years ago, which Cisco probably do better than anybody else – we left our peers behind, and it’s what we’re going to be able to do going forward."
Read about Chambers’s mistakes as leader on page 2.