I think the majority here agree that it shouldn't be required for the company to make such a cut. How much money was spent on excessive bonuses and other almost unnecessary things that did not bring much good to this company? A lot! The conclusion is that these cuts are the result of greed and carelessness, and less of the real need for such a large cut.
5 replies (most recent on top)
Without growth (organic or via acquisition) there is only one way to maintain or improve margins, cutting costs.
You forgot licensing fees! As a customer I have pay for updates because no release “just works.” It’s a great way to profit from failure, and Cisco is an expert at failing at software.
“Cisco must vastly overpay to acquire companies. Startup founders would rather sell to Cloud or Software companies with a better brand.”
Any company in the market to be acquired is looking to get top dollar so I don’t see how this is an issue from “start up” perspective. The problem with the strategy is Cisco acquires the wrong companies or fails to get their value from them. This is a failure of integration and understanding how the acquired company reached their market (fit a square peg into a round Cisco ho-e). It is not a surprise that Cisco’s most successful acquisition, Meraki, has largely been left alone to run as they want.
"Where the ELT is failing is their acquisition strategy and the software/SaaS transformation CR has touted almost his full tenure."
Cisco must vastly overpay to acquire companies. Startup founders would rather sell to Cloud or Software companies with a better brand.
Revenue under CR’s tenure has been relatively flat while margins have improved. Without growth (organic or via acquisition) there is only one way to maintain or improve margins, cutting costs. Cisco has chosen to not innovate to grow but rather rely on financial engineering. From that perspective, the job cuts are needed and the ELT is executing their plan successfully.
Where the ELT is failing is their acquisition strategy and the software/SaaS transformation CR has touted almost his full tenure. The technical debt is not great And Cisco’s products are comparable to market peers. Where we are really failing is how we deliver our saas/software solutions to our customers. We have “ship a box” processes and too much bureaucracy to compete with cloud players. We are too hard to deal with when there are products out there that are just as good or better.
Psychopaths like constant chaos it deflects the attention away from their own performance. Reorgs, acquisitions, layoffs are methods psychopaths use to create chaos in a corporate environment.