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Cisco Emerges From Restructuring 13,000 Employees Lighter

Unknown Lamer posted about 3 years ago | from the that'll-be-ten-grand-for-another-year dept.

Businesses 138

Joining the ranks of accepted submitters, Zibodiz writes with an article in PC World about Cisco restructuring. From the article: "Cisco Systems emerged from 150 days of restructuring on Tuesday ... The networking company started to streamline its operations and refocus itself on a few core businesses earlier this year after posting disappointing financial results. The subsequent restructuring shut down its Flip consumer camcorder unit and other businesses and eliminated 12,900 jobs, with almost 23,000 employees moved in the process. Executives laid out some more details on Tuesday at Cisco's annual financial analyst conference in San Jose, California. Cisco's five areas of focus now are its core routing and switching business, collaboration, data-center virtualization, video, and tying these elements together in an overall architecture." Zibodiz further writes "Perhaps the most interesting thing to me is that Cisco had 12,900 employees that were doing things other than 'routing and switching, collaboration, virtualization, video, and ... architecture.'"

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Remember when hiring MORE workers was a good sign? (5, Insightful)

elrous0 (869638) | about 3 years ago | (#37398504)

The traditional model towards profitability was to sell more product, grow your operation, hire more workers and build more factories, wash-rinse-repeat.

Today it seems like the road to profitability is to not grow, increase short-term profits by downsizing, make existing workers do more work, wash-rinse-repeat.

That's great news if you're a CEO only concerned with the short-term profitability of your brief stint as CEO (before you bail out with your golden parachute). But it's pretty shitty news if you're a worker or a long-term investor in said company. And it's even worse news if you're out of work and looking for a job.

Re:Remember when hiring MORE workers was a good si (1)

BlackTriangle (581416) | about 3 years ago | (#37398530)

This is a terrible sign for Cisco... it means they were either horribly mismanaged, or that the markets they sell into are falling out from under them.

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37398694)

That's great news if you're a CEO only concerned with the short-term profitability of your brief stint as CEO (before you bail out with your golden parachute)

Only an episode of Glee is more dramatic than you.

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37399322)

How long you been saving that one?

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37401394)

Glee viewer, eh?

Re:Remember when hiring MORE workers was a good si (1)

jellomizer (103300) | about 3 years ago | (#37398790)

Hiring more workers is still a good sign. Layoffs means the company is having trouble, but at least they are cutting the fat.

Re:Remember when hiring MORE workers was a good si (2, Interesting)

Riceballsan (816702) | about 3 years ago | (#37398944)

Actually in general what I see, the fat is the last thing to go. First they cut out the muscle, then the internal organs, then they start to concider the fat. In general the initial cuts are to support, then to engineering/developing, insert a few more key links here, then finally they start to even consider the possibility of cutting their management buddies that helped drive the place into the ground to begin with. Usually they try and delay losing managers until the managers are close to a 1:1 ratio with people they manage.

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37399230)

1;

Re:Remember when hiring MORE workers was a good si (2)

arth1 (260657) | about 3 years ago | (#37400268)

The problem is that companies add links to the command chain during expansions, but seem unable to remove them when consolidating. If anything, they add layers even then, which is counter-productive and hinders integration.
The end result is that over time, companies get heavy around the middle (to continue the fat anology).

Any company - ANY - where there are more than five steps from the top boss to the lowest worker is going to be grossly ineffective. Not only because all the superfluous management is a big money drain, but because it will suffer from sluggishness and Chinese whisper effects in the chain of command.

Cutting down on this fat is always harder than just cutting individual bosses and everybody below them. But doing the latter will always leave the company more top-heavy. It's simple maths, and thus too hard to understand for CEOs and CFOs.

So the sturdy pyramid turns into a tower, and one day it topples. Cisco isn't too big to fall, it's just a bit more wobbly now.

Re:Remember when hiring MORE workers was a good si (1)

Bengie (1121981) | about 3 years ago | (#37400880)

Yep, most CEOs like to remove R&D, engineers, programmers. Eventually they're left with a "Dilbert" corp of Managers, Sales, and Lawyers.

Re:Remember when hiring MORE workers was a good si (2)

jellomizer (103300) | about 3 years ago | (#37402914)

Sales, and Management tends to get cut too. Most companies don't hire lawyers are part of their payroll.

Yes A lot of R&D projects get cut especially ones that are not part of the core business model. And when R&D gets cut the Engineers and Programmers who are working with the R&D Projects get cut.

Most of the time a Manager should be managing 5-8 People. if there is 2 Groups with managers managing under 5 then one manager will get cut and the other will take both spots (After a bunch of Reorganization) So it is usually 4 employees per 1 manager. then 4 managers per 1 director. 4 directors for 1 vp.

However what happening is companies really don't like killing off units, so they will take out 1 or 2 employee from each department leaving no layoffs in management. So they don't kill off a future profit center, or a cost saving center.
It isn't a conspiracy it is just the numbers working out to the end guys disadvantage.

Re:Remember when hiring MORE workers was a good si (2)

dave562 (969951) | about 3 years ago | (#37402834)

I have only worked at one organization that went through any significant downsizing, but it played out differently than you laid out. First they cut from the bottom and did away with as many redundancies as possible. They also aimed at parts of various departments that were not critical to the operation of the company. On the second round of layoffs they took out most of the middle management. That is what sucked the most for me. I lost my boss (no big loss, he didn't do much anyway) but then had to pick up his work, plus my work, and didn't receive a bump in salary. Even my suggestion that they split the difference and bump me up to half way between what I made and he made was rejected.

I have since moved on. The people who rarely get cut are the senior management. You know, the people who are so out of touch with what is really going on that they fail to actually lead.

Re:Remember when hiring MORE workers was a good si (1)

khallow (566160) | about 3 years ago | (#37398816)

It's a different economic climate. Most companies don't have the growing markets or high future expectation to justify hiring more people, especially in the expensive developed world.

But it's pretty shitty news if you're a worker or a long-term investor in said company. And it's even worse news if you're out of work and looking for a job.

So what? Should Slashdot only deliver good news from now on? Is this a religious thing where we make insincere genuflections to the people who are out of luck?

Re:Remember when hiring MORE workers was a good si (1)

kelemvor4 (1980226) | about 3 years ago | (#37399524)

It's a different economic climate. Most companies don't have the growing markets or high future expectation to justify hiring more people, especially in the expensive developed world.

But it's pretty shitty news if you're a worker or a long-term investor in said company. And it's even worse news if you're out of work and looking for a job.

So what? Should Slashdot only deliver good news from now on? Is this a religious thing where we make insincere genuflections to the people who are out of luck?

He never said Slashdot shouldn't report it, just that it was bad news. Call a spade a spade, I say.

Re:Remember when hiring MORE workers was a good si (1)

tompaulco (629533) | about 3 years ago | (#37401108)

It's a different economic climate. Most companies don't have the growing markets or high future expectation to justify hiring more people, especially in the expensive developed world.
They would if they would stop outsourcing jobs to third world countries. Then first world people would be able to buy their products and their market would grow.

Re:Remember when hiring MORE workers was a good si (1)

dave562 (969951) | about 3 years ago | (#37403366)

First world people do not have the jobs, and now do not have the credit to buy the products. New markets are being developed overseas where the locals have not yet sold themselves up to their eyeballs into credit/debt slavery. Unless there is a serious change to the global economic order, on the scale of "one world government" type change, that dynamic will not change.

America fell with NAFTA and the loss of the manufacturing base. There is nothing short of armed revolution that will bring that back. And even if that happens, America does not have the resources to feed into the manfacturing process to make it work. Our economy and country was built on exploiting the resources of the rest of the world for the last three generations. The only way to try to maintain our "quality of life" at this point is to have everyone else build things for us, and then pay for those goods with dollars.

Once the dollar crashes, as it is trying very hard to do right now with Europe getting ready to default in a big way, America is going to have some real problems. On the bright side of things, most of the rest of the world depends on us to IMPORT from them. We still EXPORT large amounts of food. Sure, our quality of life will take a big hit, but at least we will be able to feed ourselves.

Re:Remember when hiring MORE workers was a good si (1)

Anonymous Coward | about 3 years ago | (#37398830)

"Grow or die" leads to"Too big to fail"

Will companies ever focus on supplying a good product at a fair price over providing a consistant 3% ROR for thier stock holders at all costs?

Re:Remember when hiring MORE workers was a good si (1)

Anonymous Coward | about 3 years ago | (#37399490)

I believe you are on the right track, however the question you SHOULD really be asking is, "Will share holders stop their insane expectations for massive quarter over quarter growth?" Unfortunately success is no longer grounded in reality - a company that can produce a solid product, employ a static, or perhaps slowly growing number of employees, and operate in the black on an annual basis is no longer considered successful. Your company must exceed single-digit growth year over year, or you are a failure to shareholders.

Re:Remember when hiring MORE workers was a good si (1)

jeffmeden (135043) | about 3 years ago | (#37398846)

The traditional model towards profitability was to sell more product, grow your operation, hire more workers and build more factories, wash-rinse-repeat.

Today it seems like the road to profitability is to not grow, increase short-term profits by downsizing, make existing workers do more work, wash-rinse-repeat.

That's great news if you're a CEO only concerned with the short-term profitability of your brief stint as CEO (before you bail out with your golden parachute). But it's pretty shitty news if you're a worker or a long-term investor in said company. And it's even worse news if you're out of work and looking for a job.

This is nothing new, actually if a company can come up with an excuse to get rid of workers aside from "our revenue is plummeting" is is almost always heralded as a good thing; after all it means that fewer employees will be taking up the work of those let go and the bottom line will most certainly improve. However poorly it bodes for the future, improvement to the bottom line this FQ makes investors happy. For a while it was "right-sizing" and then "restructuring" and the newest buzzword is apparently "delayering" but they always mean the same thing, cut the dead weight.

Re:Remember when hiring MORE workers was a good si (1)

Anonymous Coward | about 3 years ago | (#37398914)

While you're talking of the Corporate side, let me speak on the customer side.

When purchasing networking gear, I don't ever consider Cisco anymore. They've put a bad taste in the mouth and consider them blacklisted until further notice. Sorry, but having questionably made networking gear just isn't in the cards.

Re:Remember when hiring MORE workers was a good si (1)

v1 (525388) | about 3 years ago | (#37399118)

When a market is new and fresh and there are still lots of simple but good ideas that haven't been thought of yet, rapid expansion is a good thing. Once the market has matured and all of the easy niches are occupied, you have to turn and focus on what you managed to get a good foot in the door on.

If you keep trying to expand out in every direction you're in trouble. It's a bit like life in a petri dish - when you have the dish all to yourself you can expand all you want and it's great. Once the plate is full you'd better consolidate and become efficient if you want to push out other established competition to make more room in the market for yourself to slowly expand.

Re:Remember when hiring MORE workers was a good si (3, Insightful)

alen (225700) | about 3 years ago | (#37399210)

kind of hard to sell more routers and switches when your 10 year old products are more than enough for a lot of your customers

Re:Remember when hiring MORE workers was a good si (1)

jpedlow (1154099) | about 3 years ago | (#37399760)

If I had points to give. I'd mod you up so hard.

I'm the sysadmin at a medium sized company, and we just ordered a bunch of USED 7206VXR's with NPE400's. Why? Because they're $1300 each and they haul ass & handle MPLS and VOICE. I'm happy with that for the price. :)

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37401292)

Until your critical MPLS router goes belly up and you complain to Cisco about an unsupported piece of hardware you didn't have a warranty on. Then you'll start buying non-used devices.

We have 10 year old Catos switches that are dying left and right, I wouldn't think about buying a grey market replacement for production.

Re:Remember when hiring MORE workers was a good si (1)

RatherBeAnonymous (1812866) | about 3 years ago | (#37403052)

But at the price for used you can buy double the number of switches, keep the spares on hand for quick replacements, and still pay 1/4 what you would have for new gear. And that's not even including what SMARTnet coverage would cost you.

Re:Remember when hiring MORE workers was a good si (1)

Bengie (1121981) | about 3 years ago | (#37401018)

Until the competition keeps releasing higher and higher bandwidth switches/router and someone comes up with a new killer apps that makes use of it. Then you're left in the dust, and you lose most of your customers. Network admins don't like to have lots of different switch brands, then there's more to keep track of. Cisco falls behind and maybe HP and/or Juniper fill the void, and in the several years it takes to release a competing product, most of their customers have already jumped ship and gutted their infrastructure of anything Cisco.

Humans hate change. There needs to be enough incentive to change, and even more incentive to change back. It will leave people with a sour taste.

Re:Remember when hiring MORE workers was a good si (2)

roman_mir (125474) | about 3 years ago | (#37399512)

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37400040)

The reason it makes no sense to hire American workers is because we allow unfettered outsourcing, and refuse to level the playing field with countries like China which heavily subsidizes its industry and artificially controls prices. I don't see why companies should be able to benefit from American infrastructure while moving production elsewhere.

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37400320)

if production is elsewhere, then by definition companies are not profiting from American infrastructure.

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37402420)

Products and services don't magically teleport into homes and businesses. Roads, rails, ports, telecommunications networks, electric grid, water/sewer, etc., not to mention intangible infrastructure (economic, social, etc).

Re:Remember when hiring MORE workers was a good si (0)

Anonymous Coward | about 3 years ago | (#37403490)

Sure, but means of delivery do not matter, if those, who the products are delivered to are paying with counterfeit money. This vendor financed consumption will stop in a bad way, once the currency is destroyed.

Re:Remember when hiring MORE workers was a good si (1)

jthill (303417) | about 3 years ago | (#37401980)

Spend-and-spend has worked so much better than tax-and-spend.

Re:Remember when hiring MORE workers was a good si (1)

roman_mir (125474) | about 3 years ago | (#37402112)

Best thing is to allow market to earn and spend. Spending occurs in market absent government mandates and free money, and the inflation is created by the federal reserve devaluing the currency by printing it out of existence, which provides reason to gamble with money and create waste [slashdot.org] , and then market solution is a recession, but the government in power wants to be reelected, so its only SOP is to pour as much counterfeit currency into the system as possible [slashdot.org] , providing a temporary high, which still doesn't help to improve the economy, as no jobs are created, then bogus Jobs acts are pushed forward as a measure to get reelected [slashdot.org] , while the ignorant are trying to apply old failed ideas [slashdot.org] , but they will of-course fail, just like they always do even though some people predict and warn about the coming failures.

Some [youtube.com] people [youtube.com] are trying hard to warn others [youtube.com] , but very few listen.

Re:Remember when hiring MORE workers was a good si (1)

jthill (303417) | about 3 years ago | (#37402874)

Profit extraction is not wealth creation. The measure is not the thing. Metrics can be decoupled, gamed, perverted. What responsible people do in an unregulated market is one thing. What the people advocating lately do is something else entirely. Believing that all wealthy people are good, or that bad people with wealth won't do horrible damage, or that government shouldn't stop them, is beyond merely naive.

Re:Remember when hiring MORE workers was a good si (1)

roman_mir (125474) | about 3 years ago | (#37403102)

Believing that all wealthy people are good, or that bad people with wealth won't do horrible damage, or that government shouldn't stop them, is beyond merely naive.

- that's why I don't believe anything (and I am an atheist).

I don't believe in good intentions, I believe in self interest.

Self interest is what makes people want to make a profit. Self interest and making a profit is what makes people try to come up with products that other people may want to buy, thus providing the profits for those, who are self-interested.

Profit is the best motivator we have. Government can also profit some people by stealing money via taxes/counterfeiting and inflating/borrowing and then it can distribute this money based on whatever political agenda, but none of it actually is good for economy, as none of it works based on market regulations - which are: make me a product that I like and I will buy it. Make a better product, and I'll buy that one instead. Make it a cheaper product and I'll buy this one.

Re:Remember when hiring MORE workers was a good si (1)

Beorytis (1014777) | about 3 years ago | (#37400100)

Today it seems like the road to profitability is to not grow, increase short-term profits by downsizing, make existing workers do more work, wash-rinse-repeat.

Makes perfect sense in a world where the road to better government is to eliminate the government.

Re:Remember when hiring MORE workers was a good si (1)

Purpleslog (1645951) | about 3 years ago | (#37400940)

How many billions of $$$ in Flip Cameras did they expect sell?

Re:Remember when hiring MORE workers was a good si (1)

couchslug (175151) | about 3 years ago | (#37401522)

"hire more workers and build more factories"

That made sense when you needed more workers and more factories, both of which are COST centers.

Remember the great "smokestack" industries, like "Big Steel"?

We use vastly more steel nowadays, made with far fewer steelworkers.

Re:Remember when hiring MORE workers was a good si (1)

Tom (822) | about 3 years ago | (#37401668)

That's great news if you're a CEO only concerned with the short-term profitability of your brief stint as CEO

Even if you are there for a long term, it's still a good strategy. Because "long term" these days means something like 10 years.

Companies that are run by their owners, instead of some managers, are usually build to last, because the guys want to live until retirement and then some off the profits of the company, and hopefully leave it for his kids afterwards.

And managers... well, I'll just point out that there are quite a few scientific studies that show that the average manager is not really any better at managing than any average joe picked off the street. There are - and that's important - exceptions. People who really shape a company or a division, department, team around them and without whom it wouldn't be the same.
But when you have a random manager in front of you, your chances are much better than average that you could literally exchange him for anyone else in the company and the result would be the same. Interesting, isn't it? You'd think that there is something in their jobs that requires some kind of expertise. Turns out networking and politics may be the only areas. Really much like todays politicians - good at getting into power, getting elected, etc. - no idea what to do with that power once they got it, no vision, no plans no nothing. Again, there are exceptions. But if you can name half a dozen for your country, you're probably deluding yourself.

Re:Remember when hiring MORE workers was a good si (1)

DaveGod (703167) | about 3 years ago | (#37402136)

The traditional model towards profitability was to sell more product, grow your operation, hire more workers and build more factories, wash-rinse-repeat.

This was the bad idea. Or rather, it was once they took it beyond the point at which it ceased to be a good idea.

Note Cisco bought a company with the intention to sell more of it's product, grow the operation, etc etc. Evidently, they weren't very good at it. Those jobs might or might not have gone already had Cisco never bought the company, so it's hard to determine whether the net position is that Cisco's involvement shortened or lengthened those jobs.

A problem with giant corporations is they can get so much cash kicking about from their good operations that the bad ones are kept afloat for far too long. This partly explains some of the utterly shitty products/services offered by some companies, they really shouldn't be in the industry at all yet at the same time are just too powerful and established for smaller companies to move in and do the job properly. Sounds like Cisco intends to go back to doing what they know best.

Re:Remember when hiring MORE workers was a good si (1)

recharged95 (782975) | about 3 years ago | (#37402682)

a. get hedge funds as new investors (grow your investor base)
b. schmooze wall street analysts
c. tell your majority shareholders (CEO, main board members/angel investors) to dump stock/options
d. ask gov't for a bail out, ask for lower taxes
e. horde cash into the company
f. buy up competitors
g. layoff duplication of resources
h. tell wall street you made a huge profit
I. Profit! Go back to step a and repeat.

Re:Remember when hiring MORE workers was a good si (1)

carpevita (849940) | about 3 years ago | (#37403100)

I believe that this is largely an unintended side-effect of the democratization of the capital markets and specifically the stock markets. Before companies like Schwab opened the stock market to household investors, the ownership profile for publicly-traded companies typically included a handful of investors who as a group owned a large share of the company. Those investors could collaborate to chart a long-term course for the company. Compare that to Cisco, where no single investor owns more than 1% of the company (or thereabouts). In essence, "the market" owns Cisco. And the market has a very short-term perspective.

12,900 (1)

girlintraining (1395911) | about 3 years ago | (#37398558)

Perhaps the most interesting thing to me is that Cisco had 12,900 employees that were doing things other than 'routing and switching, collaboration, virtualization, video, and ... architecture.'"

We call those people 'managers' in other industries.

Re:12,900 (2)

mtmra70 (964928) | about 3 years ago | (#37398748)

Or people performing non-core business needs (janitors, shipping/receiving, security and various other support services). Any time a company fires X amount of people, they either downsize and also fire X+Y or they outsource and fire X then hire X number of contractors. The news never reports on the actual number of people affected.

Re:12,900 (2)

kiwimate (458274) | about 3 years ago | (#37398832)

Thanks. I started to post this same point, but Slashdot ate my post. There's HR, training, travel coordinators, project management, facilities (building maintenance, for instance), mailroom staff, on-site copy personnel, cafeteria staff... A lot of times I see people assuming that if you're not technical then you're overhead, but they never stop to consider the sheer amount of work required to support the core business functions.

By the way, the actual quote is this:

Cisco's five areas of focus now are its core routing and switching business, collaboration, data-center virtualization, video, and tying these elements together in an overall architecture.

Emphasis mine.

Re:12,900 (1)

Anonymous Coward | about 3 years ago | (#37398954)

And just to be clear, some of those 12,900 actually were supporting one (or more) of the five focus areas. A good-sized chunk were early retirees, many of whom were "core" engineers and managers. Not all of the lay-offs were non-essential or non-productive personnel, either. There is always collateral damage, especially when companies paint budget reductions with a broad brush.

Re:12,900 (2)

kiwimate (458274) | about 3 years ago | (#37399190)

Yes, good point about the people taking voluntary early retirement [networkworld.com] . From that article:

...non-commission-incentive employees will receive one year's regular base pay plus their annual incentive target amount. Commission-incentive employees will receive 80% of one year's regular base pay, plus 80% of their annual target commissions...

Health benefits will include a lump-sum payment equivalent to 24 months of current medical, dental, and vision coverage...

Cisco will also provide 401(k) and stock payments to eligible employees. For 401(k) plans, the company will provide a one-time payment equal to approximately two years of company matching contributions, paid as a lump sum outside of the 401(k) plan. Payment will be calculated as 4.5% multiplied by total 2011 target compensation, up to a $245,000 limit, regardless of participants' actual 401(k) participation level.

And it wasn't about getting mid-career people out and cutting 20 years off their expected jobs.

The program is aimed at a segment of U.S. and Canadian employees at least 50 years old who have a combined age plus years of service with Cisco totaling at least 60

Re:12,900 (1)

yuna49 (905461) | about 3 years ago | (#37399356)

And it wasn't about getting mid-career people out and cutting 20 years off their expected jobs.

The program is aimed at a segment of U.S. and Canadian employees at least 50 years old who have a combined age plus years of service with Cisco totaling at least 60

It's always about getting rid of those of us over 50 who are just too expensive to keep on-board. I'm 61 with an impressive resume and can't get anyone to respond to my attempts to secure a new job. Firms don't attach any value to experience; they only look at the cost side. Replacing a 55-yo employee with 30 years of experience with a 25-year-old newcomer at half or less the salary and benefits is what passes for "human relations" in corporations these days.

Re:12,900 (1)

NevarMore (248971) | about 3 years ago | (#37400938)

And it wasn't about getting mid-career people out and cutting 20 years off their expected jobs.

The program is aimed at a segment of U.S. and Canadian employees at least 50 years old who have a combined age plus years of service with Cisco totaling at least 60

It's always about getting rid of those of us over 50 who are just too expensive to keep on-board. I'm 61 with an impressive resume and can't get anyone to respond to my attempts to secure a new job. Firms don't attach any value to experience; they only look at the cost side. Replacing a 55-yo employee with 30 years of experience with a 25-year-old newcomer at half or less the salary and benefits is what passes for "human relations" in corporations these days.

Stick with it. The young devs in our 20's need you more than we know.

My last gig had me working with a great man (hi skoona!!) who was in his 50's, retired from one of the big names in computing, and wanted to get back to straight up software development. I was a few years out of college and just settling in to a lead developer role. Hiring that man for a small, young team was one of the best decisions my boss made. The good older developers come with a lot of extra experience beyond the technical stuff, I learned more about project planning and staying sane by osmosis in 3 months than I did in years of college.

It might not help yuna49 very much, but if you can stick with the job search a bit you will make a mark on your coworkers before you retire. My generation may not always realize it, or show it very well, but we do need elders around to learn from.

Re:12,900 (1)

dave562 (969951) | about 3 years ago | (#37403496)

. I was a few years out of college and just settling in to a lead developer role.

How would you feel if your boss pulled you out of the lead role and put the old man in front of you? Try to be honest, not looking back with 20/20 hindsight on how good of an experience it turned out to be.

Re:12,900 (1)

afidel (530433) | about 3 years ago | (#37399566)

Cisco has never had any of those people on their payroll and hence they've never been counted in employee numbers. When I worked at Cisco I was a contractor because deskside support was non-core and so even though it was more expensive to have IBM manage the contract and GE provide the technicians and managers it was done that way. This allowed them to keep their target of $1M per employee per year in revenue.

Cisco is doo doo (0)

Anonymous Coward | about 3 years ago | (#37398560)

Cheaper competitors have snatched market share out from underneath Cisco and they did nothing about it except chase terrible consumer grade products.

Good riddance

Re:Cisco is doo doo (1)

C_Kode (102755) | about 3 years ago | (#37399124)

I do like my Linksys SOHO E3000 router. The Flip Camera kicked ass too.

My edge routers for the data center infrastructure? Juniper.

the main issue (3, Informative)

sxpert (139117) | about 3 years ago | (#37398626)

imho, the main problem with cisco is their inability to have a decent price list that one can count on, all hardware is sold at a variable discount different for each customer, seemingly depending on the direction of the wind. Also the necessity of having an active support contract to get firmware upgrades including the ones that patch urgent security bugs is a turn off, in particular when one has payed 5 or 6 figures for a piece of equipment...

Re:the main issue (0)

Anonymous Coward | about 3 years ago | (#37403346)

Pricing is based on the discount off of list that the VAR is allowed to give and willing to give you. Gold gets the biggest discount, but then they might not like you.

The fall of corporatism (1)

Spunkee (183938) | about 3 years ago | (#37398628)

We're witnessing the fall of corporatism in this country. It's quickly approaching the point where they won't have any producing employees left. I used to think there was some nefarious plan, but it's starting to look more and more like incompetence and shortsigtedness. Dunning-Kruger effect across the board. The sociopaths at the top in this country have been allowed to go on so long unchecked that human nature is kicking in and they are being self-destructive.

Car analogy: Stupid teenage driver runs red lights and takes corners too fast over and over again. The more he does it with success, the more brazen he becomes. Then he wrecks and hopefully dies.

Then someone trolls his memorial and goes to prison.

The laid off weren't just in non-core businesses (5, Insightful)

DontBlameCanada (1325547) | about 3 years ago | (#37398648)

In the spirit of "sharing the pain" all groups were tagged with layoff requirements. This included lean teams doing critical operations in core businesses (routing, aggregation, security etc).

While the engineers are still excellent, Cisco is no longer a company run by skilled technical professionals focused on delivering quality products. Its an accounting operation infested with old-boys-clubs where decisions are primarily the result of office politics, not technical correctness. The smart people are leaving, the lucky ones are getting laid off with severance packages, the unfortunate are left holding the bag.

Re:The laid off weren't just in non-core businesse (0)

Anonymous Coward | about 3 years ago | (#37398680)

Well said.

Re:The laid off weren't just in non-core businesse (1)

alen (225700) | about 3 years ago | (#37399164)

john chambers was never an engineer. he came up from sales

Re:The laid off weren't just in non-core businesse (3, Insightful)

parallel_prankster (1455313) | about 3 years ago | (#37399468)

You have no idea how correct you are. As someone who has worked in the "core" areas, Cisco leadership now comprises of people who have stayed there due to various reasons like politics, visa issues etc etc. Most of the really smart people responsible for the networking boom in Cisco have left for greener ventures or they got tired of the politics/incompentency that is rampant in Cisco. Another example that is really close to my heart - The unit I worked for has around 500+ people out of which it is safe to say 450+ are Indians. It is safe to say the situation is the same in other units as well. The culture has become so Indianized that managers often talk in hindi and organize lunches to Indian places even if there is maybe 1 non-indian in the group (what will he do , quit ? ). The situation is so bad that even within Indians there is politics. My group that I worked on comprises of 5 people out of which 4 are from the same part of India. The 2nd level Manager only looks for people that are from the same part of India as he is. This is also visible in other groups across my BU. No problem against Indians for me, but these people brought with them a highly non-professional and obsolete management style consisting of manager-worship, no questions asked style of leadership and that was suffocating for me as a developer. Any average person like me in Cisco is bound to get frustrated and leave!. Most people there choose to stay because they have their green cards being processed and they cannot leave. The managers know that well and they try to exploit that in every way possible. The end result is an extremely mediocre management team that now faces competition from Huawei, Juniper, HP etc and has no clue how to go about it.

Re:The laid off weren't just in non-core businesse (1)

Anonymous Coward | about 3 years ago | (#37400768)

Honestly, I was at Cisco for ten years and saw the same issue you bring up with homogenized groups of cultures leading to people being ostracized. However, I would point out that for different groups of people there was more heterogeneous people and less so in others. There is a lot of politics and racial division... not sure if the old Italian mafia has any influence left, but they certainly had their own little Italy in the core 6k switching.

I left Cisco and went to a company that was mostly mainland Chinese in one group and mixed cultural background in another group. This was fine as long as the whole structure was that culture and you were a part, but interacting with that group is all but impossible for example too when even documents and meetings are not in English. Certainly, how can you ask them to switch if half your team is in China, half in the U.S. but that is what most of them speak? You by default are the odd man/woman out. You'll just have to deal and leave in my view. My favorite anecdote is the one Korean guy who they have to speak English too since he is the only competent chip-level engineer.

Efforts for example were made to "standarize" the work force operational procedure, but it did not really work and business as usual took place.
Heck even the Taiwanese Chinese feel left out... it is amazing! :)

-Aaln

Re:The laid off weren't just in non-core businesse (1)

Anonymous Coward | about 3 years ago | (#37399850)

In the spirit of "sharing the pain" all groups were tagged with layoff requirements. This included lean teams doing critical operations in core businesses (routing, aggregation, security etc).

While the engineers are still excellent, Cisco is no longer a company run by skilled technical professionals focused on delivering quality products. Its an accounting operation infested with old-boys-clubs where decisions are primarily the result of office politics, not technical correctness. The smart people are leaving, the lucky ones are getting laid off with severance packages, the unfortunate are left holding the bag.

In the spirit of "sharing the pain" all groups were tagged with layoff requirements. This included lean teams doing critical operations in core businesses (routing, aggregation, security etc).

While the engineers are still excellent, Cisco is no longer a company run by skilled technical professionals focused on delivering quality products. Its an accounting operation infested with old-boys-clubs where decisions are primarily the result of office politics, not technical correctness. The smart people are leaving, the lucky ones are getting laid off with severance packages, the unfortunate are left holding the bag.

As a Corporate customer with a long history of using Cisco Products, I could not agree more.

Cisco's solution for poorly written ,documented, and tested code seems to be to sell you "advanced services". No thanks, that's why we pay you for Suppoot.

It would seem they've outsourced themselves to the point they can no longer deliver.

Maybe they could add some people in sales... (2, Funny)

Anonymous Coward | about 3 years ago | (#37398686)

Cisco is one of the most annoying, difficult companies to buy from.

They have so many products, with many different feature levels, with many different service contracts, that no one I have talked to understands what they sell.

I've actually had to say to them:

I AM TRYING TO GIVE YOU MONEY. THIS IS A VITAL FUNCTION FOR ANY BUSINESS. INSTEAD OF MAKING IT EASY FOR ME TO GIVE YOU MONEY, YOU ARE MAKING IT HARD FOR ME TO GIVE YOU MONEY!

Re:Maybe they could add some people in sales... (3, Interesting)

quetwo (1203948) | about 3 years ago | (#37399368)

You could buy from a different vendor. There are lots of other manufactures that make great products -- most make products MUCH better than Cisco. Companies like Juniper, Extreme, Foundry, etc. all make products that end up being cheaper, more reliable and often faster than their Cisco counterpart.

Cisco lost a lof of their edge in the last 10 years when they stopped focusing on their core products. They only enhanced their products to make them work better with the products they were buying. Others have surpassed them in most products.

Re:Maybe they could add some people in sales... (0)

Anonymous Coward | about 3 years ago | (#37399544)

If you want to get Cisco's attention, just tell them that one of the gray market resellers like NHR is willing to sell you a new/sealed (or used and re-tested) whatever it is you're trying to buy from Cisco. That WILL get their attention fast.

Re:Maybe they could add some people in sales... (1)

tompaulco (629533) | about 3 years ago | (#37401286)

I AM TRYING TO GIVE YOU MONEY
At least half of the companies I try to buy from will not answer their phone when I call, and will not answer phone calls or e-mails. Why should Cisco be any different? Apparently, the economy is doing so well that salespeople can actively ignore people wanting to buy stuff from their company.

I wish... (0)

Anonymous Coward | about 3 years ago | (#37398728)

Just once, I'd like to read a headline saying something like

" announced plans to restructure and reduce costs by eliminating 1000 executive and managerial positions. In addition, the CEO, CTO, CFO and all other C level positions will see their salary cut to a mere 20 times the average salary within the company.

In other news, airborne pigs were spotted migrating south for the winter."

Re:I wish... (1)

Mitsoid (837831) | about 3 years ago | (#37398812)

Obviously this is because they need more loopholes and tax breaks to keep people at work... Because they wouldn't have fired people just to maximize profits if they saved more money on taxes!

I find you lack of faith refreshing. (1)

Thud457 (234763) | about 3 years ago | (#37399420)

obviously we're just not shoveling enough money and special privileges at the "Job Creators".

maybe it's time to go into the guillotine business.

And *I* wish... (3, Interesting)

kiwimate (458274) | about 3 years ago | (#37398994)

Just once, someone would read the article before making stupid comments like this. Here, from one of the linked articles from back in July:

The layoffs will eliminate about 9 percent of Cisco's regular, full-time workforce. In the ranks of vice president and above, Cisco said it will cut 15 percent of employees.

There, does that make you happy? Here's another one:

{Cisco} moved from a controversial collection of boards and councils managing the company to named individuals being responsible for product lines.

Sounds like administrative middle management being eliminated to me.

Also note that in the announcment in July, they talked about transferring a unit to Foxconn, saying:

No jobs will be lost in that transaction, but about 5,000 Cisco employees will be transferred to Foxconn

Read the articles and get that chip off of your shoulder.

there are things worse than being laid off (0)

Lead Butthead (321013) | about 3 years ago | (#37400168)

No jobs will be lost in that transaction, but about 5,000 Cisco employees will be transferred to Foxconn

Read the articles and get that chip off of your shoulder.

there are things worse than being laid off; like the despair foxconn inflicts on its employees [wikimedia.org] .

Re:there are things worse than being laid off (1)

tompaulco (629533) | about 3 years ago | (#37401326)

When 80% of the people "Fell from building" I stop thinking suicide and start thinking murder.

Re:And *I* wish... (1)

Nothing2Chere (1434973) | about 3 years ago | (#37401346)

So they promise to cut 15 percent of their VP's at some unspecified time in the future? Okay. When do you expect that they were they planning on doing this? They've already given pink slips (et. al) to the people who work.

Uhhh... (0)

Anonymous Coward | about 3 years ago | (#37398766)

You were surprised they have 12,900 that checked facebook all day?

Double-dip recession imminent? (1)

Nimey (114278) | about 3 years ago | (#37398768)

Between this and Bank of America dropping thousands of jobs, I'm starting to wonder.

Re:Double-dip recession imminent? (0)

Anonymous Coward | about 3 years ago | (#37398902)

You're implying we ever escaped the first depression. So the economists lied to increase investor confidence, what's new?

Re:Double-dip recession imminent? (1)

royallthefourth (1564389) | about 3 years ago | (#37399098)

You're implying we ever escaped the first depression.

Haven't you heard? The Dow is back over 11k. The economy is doing great.
Unemployment, poverty, and sickness? Those are sociological problems. You'll have to solve them yourselves.

Now if you'll excuse me, I must attend to my Wall Street Journal and a P'zone. Next time please lodge your complaint with your congressman; he'll get right on it.

Re:Double-dip recession imminent? (1)

Spunkee (183938) | about 3 years ago | (#37398904)

Between this and Bank of America dropping thousands of jobs, I'm starting to wonder.

Yes, and the the citizens of the US will gladly give them more money to enrich the C*Os. The populace in the US loves taking it up the ass.

Re:Double-dip recession imminent? (1)

Fallingcow (213461) | about 3 years ago | (#37401954)

No, silly. We have to give our corporate overlords more tax breaks if we want them to start hiring.

They really, really want to hire more of us, they just can't because of those damn taxes they pay on all the profits they're not hiring people with.

Don't forget... (1)

benjamindees (441808) | about 3 years ago | (#37398804)

Don't forget the "Helping Governments Spy on their Citizens" area. That's probably the reason for the virtualization, though. Hell, it was probably the reason they killed off that HD camcorder thing. Can't have people uploading high-def videos of the communist reptilian space aliens who run things, now can we? They probably thought they would be able to co-opt it in real time like all those UFO videos you see where the first one looks real and then the poorly-done fakes start pouring in and discredit the whole thing and before you know it it's all kooks and nutjobs who think that 9/11 was done with disintegration rays. Those 12,000 people were probably working on building $500 hammers for the CIA, amirite?

chosen ones to exit holycost 4.5 billion lighter (0)

Anonymous Coward | about 3 years ago | (#37398858)

that's population, not dollars. that's pervasive non-accountable fatal distraction 'accounting', considering that the victims are never associated with the 'company'.

for each of the creators' innocents harmed in any way....

Shame about the Flip Video Cameras (1)

C_Kode (102755) | about 3 years ago | (#37399068)

We have several of them and my family loves them. They were easy to use and took decent quality movies. They were 1000x easier to use than our regular Canon HD Camcorder. This you could just pull out of your pocket and make a video. The other required setup time, hooking up our Rode shotgun mic, digital tapes, etc.

Cisco purchased a great product and basically killed it. Probably mostly due to advertising. They had TONS of paid celebrities doing ads for them and 1,000s of posters everywhere. There had to be 1,000 posters up in Grand Central Station alone.

Re:Shame about the Flip Video Cameras (1)

bastia (145202) | about 3 years ago | (#37399880)

I believe that smartphones with video overtook the Flip faster than Cisco expected. The Flip was a good little device, but it was too expensive for a single purpose device once smartphones started including HD video recording. Cisco would either have to drop the Flip prices and work for much smaller margins, or it would have to kill the division. It chose to do the latter so that it could use that money on its core products.

Re:Shame about the Flip Video Cameras (1)

tompaulco (629533) | about 3 years ago | (#37401380)

They could have advertised it as a smart phone. What are the odds anybody would ever try to make a call on it?

Odd claims (4, Interesting)

HockeyPuck (141947) | about 3 years ago | (#37399072)

First Cisco offered an Early Retirement Package... this backfired since many of the senior technical folks, who would have no problems getting a job somewhere else took the package and immediately got a job at a competitor. Nothing like paying top talent to work somewhere else.

They as part of the layoffs they said that they would lay off 15% of all VP and higher folks. A few Distinguished Engineers were let go.

Then this morning they announced that FOUR new VPs were made Senior VPs.

Cisco's employee profile is shaped like an hour glass, you're either upper management or a grunt. There is no middle class here. I"ve also heard of this place like a upside down pyramid. Btw, VPs get a compensation that is orders of magnitude greater than any individual contributor (including Distinguished Engineers, for which there are 100 in the entire company).

Re:Odd claims (1)

networkconsultant (1224452) | about 3 years ago | (#37399886)

They outsource a LOT of their labor, if your an engineer you can make upwards of $2000 /day doing work for various telecoms.

Re:Odd claims (1)

bastia (145202) | about 3 years ago | (#37399996)

Compared to some other companies, I'm actually impressed with the length of Cisco's technical track. It's possible to a long technical career within the company with regular pay increases and promotions without switching to the "business" side. In many companies, promotions quickly push technical people into management or technical sales or something. I haven't seen that at Cisco.

Of course, I still expect that the people who are closer to sales and major product decisions (VPs and SVPs) to make more than the senior engineers. Fortunately, I've also seen that Cisco is willing to fire upper management if they make too big or too many bad decisions that hurt margins, product quality, etc. Listening to the message Chambers has been putting out, part of the restructuring seems to be aimed at increased accountability in upper management. It's no use to build awesome products if the company can't sell them or can't sell them at a profit.

Re:Odd claims (1)

TemporalBeing (803363) | about 3 years ago | (#37400868)

Compared to some other companies, I'm actually impressed with the length of Cisco's technical track. It's possible to a long technical career within the company with regular pay increases and promotions without switching to the "business" side. In many companies, promotions quickly push technical people into management or technical sales or something. I haven't seen that at Cisco.

Of course, I still expect that the people who are closer to sales and major product decisions (VPs and SVPs) to make more than the senior engineers. Fortunately, I've also seen that Cisco is willing to fire upper management if they make too big or too many bad decisions that hurt margins, product quality, etc. Listening to the message Chambers has been putting out, part of the restructuring seems to be aimed at increased accountability in upper management. It's no use to build awesome products if the company can't sell them or can't sell them at a profit.

Well, they'd be able to trim a lot of technical too if they cleaned up all the integration to make things easier to integrate. I know in the Video-Conferencing stuff that was suppose to happen with Version 6. Don't know if it did; but the database in Version 5 was not easy to decode - took me a few days to work out an ERD for it and there was no help from Cisco on that.

Re:Odd claims (0)

Anonymous Coward | about 3 years ago | (#37400926)

Awesome products sell themselves. It's not like Cisco builds impulse purchase items in your grocery store checkout line.

Re:Odd claims (1)

bastia (145202) | about 3 years ago | (#37401258)

Yes and no. I mean, no one wants to buy a crummy product. On the other hand, producers need to be able to sell the product with specific volume and price points to make the profit margins that they plan years in advance. There are some very careful trade offs involved in that kind of work. In business, it's possible to launch and sell a profitable product line and still fail because you came in at a profit margin of 10% instead of 30%.

Isn't that sort of the core of the discussion over HP's WebOS tablets? They can make and sell them, but their desired price point didn't produce the volume of sales that they needed. The product that was crummy at one price point became awesome at another. Can HP find a price where they'll get the sales that they need to make enough profit to make it worthwhile? Even if they can sell the tables for a tiny profit, HP may prefer to focus their time, people, and capital on other, more profitable businesses.

Re:Odd claims (0)

Anonymous Coward | about 3 years ago | (#37402972)

Sounds like the Media and Entertainment Industry.

Stop funding them (0)

sl4shd0rk (755837) | about 3 years ago | (#37399252)

Best way to vote is with your dollar. If you don't like the way corporate conservatism is further corrupting the US economic/political system then man-up and stop supporting the megacorps. There's other ways of routing/firewalling network traffic if you are not afraid to have the skills.

13 000 lighter (0)

Anonymous Coward | about 3 years ago | (#37399296)

I was wondering why the hell did cisco restructure 13 000 lighters

not entirely true (2)

gordona (121157) | about 3 years ago | (#37400162)

Some of the 12900 employees that were laid off or had voluntarily retired were doing things outside of the 5 areas of focus. Some on my development team were in one these areas but the bulk of the development in this area was shifted overseas. A large number of the voluntary retirees were doing work in these areas as well. With some of these folks in very key roles.

Yes and No Workers (1)

Doc Ruby (173196) | about 3 years ago | (#37400270)

Zibodiz further writes "Perhaps the most interesting thing to me is that Cisco had 12,900 employees that were doing things other than 'routing and switching, collaboration, virtualization, video, and ... architecture.'"

No, Cisco probably is firing many thousands of workers who were working on those core business activities that Cisco is retaining. There's no simple relationship between what a worker was doing and what the corporate rulers say the corporation will now do, when the corporation fires so many people at once. Especially when the corporation was profitable and known for quality before the firings.

But yes, Cisco surely had many employees who were doing other things. Like all the corporate execs and their ecosystem who are responsible for pure finance, including managing the company's publicly traded equity (stock) and publicly/privately juggled debt (bonds, mortgages, government loans, private loans, credit default swaps, other derivatives). When you're a big brand with lots of property like Cisco, especially when you define an industry - or a whole sector (like "the Internet), you make (and lose) lots of money in business purely derivative of your actual operating business.

And no, those finance parasites are probably not being fired. You almost never hear about these corporations firing lots of their banking interface infrastructure. Because the financial system is so deeply rigged to be both a money and an influence machine. Even when distracting a company out of real profitability. The guy who gets you into the casino is more tightly held than the guy who worked to give you your first ante.

So fewer managers, yes? (0)

Anonymous Coward | about 3 years ago | (#37400362)

And since the CEO is CEO of a much smaller company, his pay is going down, yes?

Interesting theory about Cisco being 'doomed' (2)

hartley231 (1121019) | about 3 years ago | (#37400702)

Good read on the back of the recent WSJ article by Andreessen about 'Software eating the world'. The post makes the case that Cisco is 'doomed' on the basis that 'If the output of your hardware is information or the manipulation of information then you are going to get eaten. If the output is something else then you are not.'

http://brontecapital.blogspot.com/2011/08/software-eats-part-of-world.html [blogspot.com]

With Intel buying Fulcrum, Vyatta and other virtual networking plays entering this space, the current method of buying hundreds and thousands of standalone firewalls, load balancers, switches, routers, WAN accelerators, VPN boxes, SSL terminators etc. as seperate appliances is going to start looking antiquated quickly. There will be exceptions where dedicated single purpose hardware is still required but even those exceptions are shrinking.

Tandberg Acquisition - Hiring New Staff (1)

turgid (580780) | about 3 years ago | (#37402728)

Cisco appear to have acquired Tandberg (video conferencing stuff) and are hiring. This huge layoff/outsourcing doesn't give me a great deal of confidence in them, so what's going on?

What are they up to?

I suppose they could get some new development going and then outsource to India it after 12-18 months.

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