Cisco selected 3 contract companies for managed services and all red badges were moved into those managed services companies if possible. If not they are gone. Model is to have just a few FTE and many in managed services. Long term goal is that managed services will grow is experience and skill set and they can continue to reduce the FTE's.
What they don't get is that is costs a lot to live in the Silicon Valley. Good people will get jobs with better money. Managed services companies can only attract people with average abilities because they pay less and have a lower level of benefits.
Long term quality will continue to decline, moral will continue to decline, managed services will see continued turn over, Palo Alto Networks, Arista etc will continue to crush Cisco due to its lack of investment in a highly qualified and stable workforce.