Management of IT Resources in Cisco A CIO's Perspective
Dr. Lazar Rusu Team Coach Nishant Jain Team Leader The Team Introduction Global IT Management (GITM, 2006): A Case Study
Cisco Systems: Technology & People <ul><li>300 locations in 90 countries </li></ul><ul><li>400 buildings </li></ul><ul><li>50 data centers and server rooms </li></ul><ul><li>1 000+ labs world wide </li></ul><ul><li>35,000 Employees </li></ul><ul><li>18,000 Contractors </li></ul><ul><li>20,000 Channel Partners </li></ul><ul><li>110+ Application Service Providers </li></ul><ul><li>210+ Business and Support Development Partners </li></ul><ul><li>Over 125,000 people around the world in the extended Cisco family </li></ul>
Technological Challanges Base for Modeling IT Strategies <ul><li>Functionality </li></ul><ul><ul><li>New equipment or service is added only if it provides new functionality that appears to provide improved user productivity, or overall reduced IT costs. </li></ul></ul><ul><li>Versatility </li></ul><ul><ul><li>Cisco IT ensures that every new technology change should also be versatile enough to support users at any location and for any normal business </li></ul></ul>
Technological Challanges Base for Modeling IT Strategies <ul><li>Performance </li></ul><ul><ul><li>Cisco IT ensures that new technology implementations or the updates should perform well, providing extremely fast response time to end users even under significant stress levels and at any location worldwide . Fast performance translates to improved user productivity. </li></ul></ul><ul><li>Cost of Ownership </li></ul><ul><ul><li>Cisco IT is under constant pressure from the business to improve productivity while reducing the total cost. </li></ul></ul>
Technological Challanges Base for Modeling IT Strategies <ul><li>Security </li></ul><ul><ul><li>Cisco IT has the task to prevent any infringement of Cisco's resources or IP, by use of active, seamless, transparent and multilayer security achieved through a number of inter-related complimentary technologies. </li></ul></ul><ul><li>Ease of Operation and Maintenanc e </li></ul><ul><ul><li>Cisco IT ensures standardization of computing platform, equipments and software across their operations spread globally. </li></ul></ul>
Cisco Systems: The IT Strategy - Framework <ul><li>Goal: make it easy to do business with the company. </li></ul><ul><li>Three strategic decisions: </li></ul><ul><ul><li>Focus IT on customers: </li></ul></ul><ul><ul><ul><li>IT moves from CFO to Customer Advocacy (takes care of all customer touching services & products). </li></ul></ul></ul><ul><ul><ul><li>Projects which don’t raise customer satisfaction aren’t funded. </li></ul></ul></ul><ul><ul><li>Managers of business units (BU’s) decide which applications to build IT decides how. </li></ul></ul><ul><ul><li>Creation of an enterprise-wide network & standards. BUs do not have to justify infrastructure investments. </li></ul></ul>
Cisco Systems: Global IT Strategy <ul><li>" In today’s world of technology, we operate less on country or even theatre levels, and more on a global level. This means that our technology solutions must enable business on that level, for our customers, partners, channels and employees, regardless of location – communications and access to network resources and tools must be seamless, simple and secure. " - Cisco on Cisco </li></ul><ul><li>Cisco’s IT strategists emphasize to realiz e new levels of collaboration and productivity, allowing customers, partners, channels and employees to respond quickly to change. </li></ul>
Cisco Systems: Global IT Strategy <ul><li>Cisco IT strategists see Cisco as a n organization separated by tools, distance, time and technology which can communicate effectively and leveragestrengths viewing the world as an extended campus. </li></ul><ul><li>Cisco IT strategists emphasize on Cisco 's success and the ability to us e the Internet to reach customers and partners with access to the ordering and manufacturing partner Websites, thus bringing customers together with customer support to collaborate via audio and video and Web, until the problem is resolved and questions are answered. </li></ul>
Cisco Systems: Global IT Strategy <ul><li>Cisco IT strategists ensure that Internet projects align with business objectives </li></ul><ul><ul><li>The projects are mapped against the company's goals to ensure that company's resource focus lines up against what is important for the company . </li></ul></ul><ul><li>Cisco's client-funded model encourages collaboration between business and IT leaders to prioritize projects that improve productivity. </li></ul>
Cisco Systems: Global IT Strategy <ul><li>Internet Capabilities Review </li></ul><ul><ul><li>A corporate practice exclusive to Cisco where John Chambers [CEO] holds meetings quarterly and each function is asked to present its Internet portfolio and priorities. The idea is to evaluate cross-functional integration of Internet capabilities. </li></ul></ul><ul><li>Evaluation of Online Initiatives </li></ul><ul><ul><li>M ost important measurement of success at Cisco focuses on the value that the systems they build bring to the business and how much these strategies are changing real business processes. The progress is examined and success is measured on a continual basis </li></ul></ul>
CIO’s roles and attributes <ul><li>Peter Solvik, CIO, had to coordinate efforts in BUs to achieve a company wide information system. </li></ul><ul><li>Advantages: </li></ul><ul><ul><li>Centrally managed infrastructure investment </li></ul></ul><ul><ul><li>Extensive functional management team involvement in IT </li></ul></ul><ul><ul><li>CIO measures only if the infrastructure costs will add more value to the product/service sold/provided. </li></ul></ul>
CIO's Effectiveness: The Changing Perception <ul><li>CIO: An IT and Business Process Strategist </li></ul>http://www.optimizemag.com/article/showArticle.jhtml?articleId=53701400&pgno=1
Cisco Systems: The Business of IT <ul><li>Realities of CIO Challenges Today at Cisco in Modern Business Environment:: </li></ul><ul><ul><li>Building and maintaining key relationships </li></ul></ul><ul><ul><li>Selling the value of IT in the boardroom </li></ul></ul><ul><ul><li>Separating fad from fact whether in staffing, technologies, or business trends </li></ul></ul><ul><ul><li>Responding to legal and regulatory requirements </li></ul></ul><ul><ul><li>Leading technology strategy vs leading quality operations </li></ul></ul><ul><ul><li>Linking Technology Decisions to the Bottom Line </li></ul></ul>
Interview with CIO Mr. Brad Boston CIO, Cisco System Inc.
IT Resource Management Nishant Jain GITM, 2006 KTH, Sweden Q1. In context of Cisco, What is the difference in formulation and implementation of IT resource management strategies between Sweden, UK and Unite states ? Cisco is a global company. We have centralized IT around that premise. For the most part, IT is managed on a global basis with specialization at the country level on a case by case basis.
CIO & Culture Distinctions Nishant Jain GITM, 2006 KTH, Sweden Q2. Being CIO of a truly multinational corporation like Cisco, how noteworthy do you think is the influence of culture on implementation of standardized corporate values, vision and business processes or strategies? Does cultural distinction makes a difference? Culture is critical to the success of any company. Every company will, over time, develop its own unique personality. Above all, Cisco is a member of both a global community and a local community. Cisco’s culture of quality, teamwork, empowerment, frugality and giving back continues to be a key part of what drives all of our business strategies. We even go so far as to look for similar cultural fits in companies that we would like to acquire. If the culture doesn’t match, chances are it will be that much more difficult to assimilate the company and retain the employees. Your culture is what defines you as a company
CIO’s Responsibilities Nishant Jain GITM, 2006 KTH, Sweden Q3. Cisco, having been known as one of world’s best managed companies and truly multinational in nature, how do you envisage the changing role of a CIO in context of responsibilities and commitments? The role is more and more business and leadership focused but it’s critical that you have a solid understanding of technology. The day to day issues of running the network are best left to the people I hired to do the job. We used to think that to be a successful CIO, you had to grow up in IT, but, more and more today, leading an IT organization requires the ability to set and drive vision. Additionally, as IT capability becomes more and more of a company differentiator, it requires someone that is a good spokesperson, someone that can clearly communicate the value to other organizations (both inside and outside the company), and someone that can bring confidence that IT is more than just an infrastructure group but a trusted partner in business.
CIO & Multinational Corporation Nishant jain Team8, GITM, 2006 KTH, Sweden Q4. What individual and professional traits an individual must adhere and cherish to deem suitable for a CIO role in a multinational corporation like Cisco? <ul><li>The top five management guidelines that I have found most beneficial in my path to becoming CIO at Cisco: </li></ul><ul><li>Don’t forget the basics – problem management, change management and portfolio management. – </li></ul><ul><li>There is no such thing as a technology project. There are business initiatives that can use technology. The business needs to own and drive the project. Don’t throw it over the wall to IT and expect miracles. </li></ul><ul><li>Understand the decisions that truly drive your costs </li></ul><ul><li>Match people to their strengths. </li></ul><ul><li>And most importantly, hire great people, point them in the right direction and get out of their way </li></ul>
CIO & Emerging Economies Nishant Jain Team8, GITM, 2006 KTH, Sweden Q5. Now a question which is equivocally being raised at every forum and by everyone, from politicians to corporate heads and economists to intellectuals; how do you foresee the impressive industrialization and exorbitant growth rates of emerging economic giants like China and India? Would you term this as a bubble that will eventually subside or a reality that the world must acknowledge? Cisco has been in China 10 years, we current have 600 people in 8 offices across China. China is one of our largest markets globally and the largest country within Asia Pacific. With a population of over 1.3 billion, they are second in world wide Internet subscribers and number one in mobile subscribers. China continues to be one of the top producers of degreed engineers in the world. India is probably the world 's largest democracy and will soon be the largest English speaking country in the world, and the demand for bandwidth is just like Japan. We currently have over 1400 direct employees across India and will be investing over $1 billion US in the next three years. I’m a business person and a technologist not a politician. I believe that both of these countries have the potential for great and sustained success as they develop into a networked economy.
Critical Success Factors of Cisco Nishant Jain GITM, 2006 KTH, Sweden Q6. .What are the critical success factors, from the perspective of a CIO, which has contributed towards Cisco being recognized and valued as one of the world’s best managed companies? Being a Network company, we understood long ago the power that the network offers to differentiate a company. More importantly, we have a CEO that “Gets it”. He understands the importance of IT to the business. With that knowledge he has driven the company’s leaders to show how they are continually extracting more value from the Network. Beyond our IT focus, every Manager at Cisco understands the value of open dialog and flat organizations. Every one at Cisco is empowered to make change. If there is a better way to do business, it’s an individual’s responsibility to speak up. We have a culture at Cisco that encourages and values open communication and empowerment
CIO & Executive Team/Board Nishant Jain GITM, 2006 KTH, Sweden Q7. For effective implementation of IT strategies and formulation of successful IT vision, how significant is it for the CIO to be part of the Executive Team/Board? Perhaps you mean having the CIO as a part of the Executive team? To be effective at formulating the correct strategies, the CIO must be engaged with the other business leaders. This is partially accomplished by roles on cross functional boards and leadership committees. It’s not as critical as to where the CIO directly reports as it is the role that he or she plays in the organization and whether IT is viewed as a business partner or a cost center. At Cisco I report into Operations but sit on the Operating Committee and the Business Process Operating Council which sets and drives Cisco’s global priorities and strategies.
CIO & IT Nishant Jain GITM, 2006 KTH, Sweden Q8. From the perspective of a CIO of a multinational corporation, how would you explain the present trend of outsourcing? Do you consider it as a positive phenomenon in the changing world order or just a derivative of the IT industry crash at the beginning of this millennium, born out of necessity? As companies become more and more aware of the power of IT, they will look to industry experts to help them extract the maximum value from it. For some companies, like Cisco, understanding and being able to take advantage of that value is a core competency. For others, that do not have the core IT capability but strengths in other areas, they will look to others to help them. This is inevitable and a strength in our global market. Outsourcing this capability is positive for the market. It allows companies to focus on their core strenghts while getting others to focus on the context needs. What’s important (and difficult) is for companies to recognize how much of their infrastructure and their governance to outsoruce. As an example, Cisco completely outsources its desk top support but maintains overall control of the infrastructure that suports it.
Risk Management Nishant Jain GITM, 2006 KTH, Sweden Q9. In today’s globalized world, what should be the major concerns and priorities of a CIO? Could you enlighten us on some of the Cisco’s risk management strategies? Today, it is crucial that the projects in IT align with the business priorities of the company. The major concerns and priorities of the CIO are the same as the other business leaders in the company. IT at Cisco is responsible not just for creating the infrastructure but for partnering with other business leaders across Cisco to be successful. IT, with the possible exception of Human Resources, is the one group that can see across all organizations. This gives us a unique perspective and a responsibility to ensure every project and initiative helps drive Cisco forward. Regarding risk management, Cisco has adopted a framework to optimize and protect Cisco's people, property and information by actively partnering with internal and external organizations. We have a team of people dedicated to coordinating our efforts in business resiliency, crisis management, education, awareness, monitoring and reporting.
CIO at Cisco: The Conclusion <ul><li>The Role </li></ul><ul><li>To understand the challenges facing the company and participate in the strategic planning discussions to formulate/develop IT Strategies that help the business managers in restructuring the business model through the use of IT. </li></ul><ul><li>Solve specific business issues/problems faced by the organization. </li></ul><ul><li>Effectively align business strategies/goals with IT capabilities to create achievable IT initiatives and a plan for implementation. </li></ul>
CIO at Cisco: The Conclusion <ul><li>The Role </li></ul><ul><li>Assess sourcing options, organizational readiness and IS functions' capabilities to make informed decisions for staffing and implementing IT initiatives. </li></ul><ul><li>Continuously evaluate the gaps between dynamic business needs and IT offerings and initiate actions to prevent any negative impact on business. </li></ul><ul><li>Develop appropriate strategies for managing and motivating IS resources to achieve organizational objectives. </li></ul>
CIO at Cisco: The Conclusion <ul><li>The Challenges </li></ul><ul><li>The ability to quickly gain the understanding of company's business model and the business problems that are impacting or likely to impact it's competitive position. </li></ul><ul><li>Creation of awareness about the power of IT and its strategic advantages to the business among the board members. </li></ul><ul><li>Proactively developing a business aligned IT strategy. </li></ul>
CIO at Cisco: The Conclusion <ul><li>The Challenges </li></ul><ul><li>Effective communication with business managers at all levels for creating an environment of comfort and confidence in the team. </li></ul><ul><li>Setting the right expectation levels. </li></ul><ul><li>Effective management of manpower attrition to minimize its impact on IT services/initiatives </li></ul>
CIO at Cisco: The Conclusion <ul><li>Skills Required </li></ul><ul><li>Ability to comprehend the business model, particularly to understand how the business is attempting to create superior value for the customer/consumer. </li></ul><ul><li>Insights into how the various business processes combine and synergize to create the superior value business model. </li></ul><ul><li>Capability to think through a technology model which can impact cutting edge differentiation to the business model. </li></ul><ul><li>Extraordinary ability to lead high competency teams, synergize their knowledge and help them to learn to think in terms of business processes and business modeling. </li></ul>
Global IT Management <ul><li>Questions Please ? </li></ul>
Global IT Management <ul><li>Thank You!! </li></ul>