Cisco Kids Battle Disruption

By Tony Clark, 2-Dooz Inc. – August 26, 2014 (Original Publication Date)

Technology disruption is like a game of musical chairs.  The beginning of each new upset is akin to a song which forces all of the affected suppliers to rise from their seats and circle the now empty chairs.  In theory, every player in musical chairs has an equal chance to secure one of the seats while the music plays.  But in practice, the bigger and faster kids always seem to prevail.  They muscle, out-quick and exploit other advantages to ensure themselves a seat when the music ends.  Cisco is now facing the Cloud and Software Define Networking (SDN) music, but in all likelihood they will not be the one left without a seat.  At least in the enterprise, they’ve seemingly managed to highjack the cue to play the music.

It is widely acknowledged that the Cloud and SDN are two concurrent disruptive technology themes that Cisco is facing.  Yet, John Chambers failed to cite either as a key challenge during the company’s August 13, 2014 earnings conference call.  Instead, Chambers proactively addressed Cisco’s less than stellar fiscal year 2014 performance by pointing to the following key headwinds: “the federal government shutdown and the possibility of a U.S. default, combined with significant slowdown in emerging markets.”  Moreover, Chambers noted, “Our innovation this period has secured us the leadership position in cloud and hybrid cloud, made us the recognized leader with our customers in SDN, and has driven new opportunities with customers embracing the Internet of Everything.” Cloud and SDN leadership: say what?

It turns out that Chambers is probably right.  Before explaining why, a little digression is helpful.  The Cisco Kid is an American Western television series starring Duncan Renaldo in the lead role as Cisco and Leo Carrillo as his sidekick Poncho—best known for his catchphrase “Oh Ceesco!”  Production began on the series in 1949.  Cisco and Pancho are revered as Western Robin Hoods.  The TV show inspired the band War’s hit song “The Cisco Kid.”  The likeable caballero’s where also depicted in comic books, in a radio series, and in the movies.

When I started my career, the prevailing wisdom regarding IT was that no-one ever got fired for buying IBM.  In the intervening years, Cisco assumed this mantle by, in part, leveraging its various Cisco Certified Experts educational tracks to amass an army of trained loyalists.  Each Cisco Certified Internetworking Expert (CCIE) pledges their allegiance by investing thousands of their own dollars and 18 months of their time on average to secure certification.    After such a significant investment they become unabashed advocates for Cisco within the companies they work.  The CCIE network engineers are modern day Cisco Kids.  They are the protectors and benefactors of Cisco’s success.  These droves and droves of true believers have for now muted the impact of any possible Cloud or SDN disruption on Cisco in the enterprise.  Returning to the musical chairs analogy, the CCIEs are preventing the music from even being played.  In the enterprise, Cisco needn’t bother to get out of its seat.

In War’s musical classic titled “The Cisco Kid,” the band pays a tribute to the old western.  Lyrics include “The Cisco Kid was a friend of mine” and “The outlaws had us pinned down at the fort … Cisco came in blastin, drinkin port.”  Cisco Systems’ CCIEs are the new Cisco Kids, blasting the Cloud and SDN threats while holding down the enterprise fort.  Chambers said as much in Cisco’s recent investor conference call, commenting “we saw strength around the globe in our enterprise business, up over 9%.”  Cisco Kids are a friend of mine …

Those are my thoughts.  As always, I invite and look forward to learning what you think.

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