Monday, July 16, 2012

Torture "Chambers"

In the Old West (USA) there was a famous outlaw and gunfighter named John Wesley Hardin.  His story is famous, with claims of him single-handedly killing over 42 men.  You could read more about him in a book called Triggernometry

One of the things about Hardin that always fascinated me was his use of initiative.  In more than one case Hardin was able to draw his pistol and shoot down another man who was already pointing a cocked pistol at him.  Imagine how that might seem impossible.  There he was standing, "dead to rights" with a man holding a gun on him.  All the other man had to do was pull the trigger and BLAM, Hardin was dead.  But in every case he was able to reach down, draw his side iron, aim and pull the trigger.  And each time the man holding the cocked pistol was dead before he could react.

There is a technical explanation for how Hardin could accomplish this feat.  The U.S. Military and associated people have developed a concept called "OODA" and it shows how a human's mind will work in these types of situations.  I'm not going to cover that in this column but you can read about it here: http://en.wikipedia.org/wiki/OODA_loop

While I usually write about CIOs, today I'm going to discuss CEOs and the importance of initiative as it pertains to leadership.  I read an article in Forbes the other day that talked about five sitting CEOs that should have already been fired.  Among the list were two men who are frequent targets of criticism.  One was Microsoft's Steve Balmer and the other, whom I will now talk about, was Cisco's John Chambers.

Chambers took the helm of Cisco in 1995 and for a time helped that company come to dominate the networking space.  He did so well that by 2001 Cisco's stock was trading at over $70/share.  Like many leaders who enjoy great success - business, banking, military - Chambers fell asleep on the job.  He turned into an administrator rather than a visionary and the wheels started falling off.  My personal feeling is that he became enmeshed in the activity of enjoying success rather than creating success.  You can read any number of articles about the perks and compensation that Chambers has received.  If you do your own research, you should make a quick comparison to Steve Jobs and his $1 salary.  Think about where each man was focused and then compare that to the relative growth and success of their companies.  Yep, one man was clearly leading while the other was clearly "managing".

Over the past 10 years, Cisco's stock has gone from $70+/share to somewhere around $15/share.  That's a loss of almost 80% (!)  So what happened, you might ask?  Here are a few things that show where Chambers and his team dropped the ball:

  • Cisco missed out on smartphone mobility.  Do you see any Cisco presence in the burgeoning smartphone or tablet market?
  • Smart grid - Here is an area where networking is THE biggest component in a multi-billion dollar sector.  No obvious Cisco presence there.
  • Cloud storage or cloud processing - there was a small push in 2009-10 for Cisco to get into that business but nothing public really emerged.
  • Supply chain - at least three times over the past seven years Cisco has had order fulfillment times of over six months for some of its core products.(I'm not going to cite specifics due to confidentiality concerns)  That's just a ludicrous amount of time for a core product order to take.
  • Networking Fabric - the new direction in networking is to have a smart or learning system that can evolve over time.  Utilizing new software and hardware, the network becomes much flatter and gains the ability to intelligently route and prioritize traffic.  One of Cisco's competitors, Juniper Networks, has had a product out for several years now called "Q Fabric".  In terms of advancement, this product is light years beyond what Cisco has been able to produce in the smart-networking arena.  Cisco has played in the space for years, trying to put out a half-baked strategy/product first called TRiLL and then "Jawbreaker" but now nothing is on the horizon.
As leaders we must always be seizing the initiative.  Doing anything less has real world consequences that, depending on the scale, can range from hampering growth all the way to costing investors billions of dollars and thousands of employee jobs.  And mark my words, Cisco better look hard right now at HP to see what happens to workforces that languish too long under managers who do not lead or innovate. (They end up shedding tens of thousands of jobs).  That's going to be Cisco's fate if they don't get their act together soon.  I'd say the same thing about Microsoft if they didn't have the XBox product and stranglehold on Office productivity.

As a leader, the next time you think about "Going On The Defensive" just reflect on how John Wesley Hardin (and your customers) will tune you up.

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