Management Turnover as Change Agent

Friday, December 21, 2007

Cisco Succession Planning Takes A Second Hit

Cisco Systems, Inc., CSCO (NASDAQ) the networking gear maker lost another top executive, Charles Giancarlo - the chief development officer, who had been rumored to be heir-apparent to John Chambers (CEO). He resigned to join the private equity firm Silver Lake Partners. Earlier in the year, another top level executive, Michelangelo Volpi, resigned. Volpi was the Senior Vice President and General Manager of the Routing and Service Provider Group and was also considered a potential successor to Chambers. He left and ultimately joined the Internet TV firm, Joost.

According to the U.K. Register, Giancarlo,
... told reporters in a conference call yesterday that Cisco's management restructure did not fit with his ambitions to be at the helm of a company.

In a story by Mark Boslet in the Mercury News further elaboration was provided about Giancarlo's decision.

Rumors about his (Giancarlo) possible departure began spreading nearly a month ago after Chambers told the board earlier this year he would remain for three to five more years.

Observers said differences in style between Giancarlo and Chambers may have discouraged him about his chances to lead the company. "Charlie and John are very different people," said Tom Nolle, president of market researcher CIMI of Voorhees, N.J. "Charlie is much more of an intellectual. John is the ultimate salesman - he's a showman."

For better or worse, Chambers has put in place a new management structure. Chambers said the new management structure would,
"transition from a company that is driven from command and control to one that is built on teamwork and collaboration." ... “I believe this type of structure will be the future, given the complexities and ... market adjacencies we’re going to move into.”
As Cisco continues to thrive, will the so called "new management structure" have an impact on the firm? Will things remain the same or will there be real changes and what will be the results?

Stay tuned.

For more:

The Houston Chronicle
Times Online

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