Cisco Organizational Structure
ABSTRACT:
Cisco Systems, Inc. (Cisco), an Internet technology company, had an organizational structure comprising of various cross-functional teams. The key decisions in the company were taken by councils, boards and working groups. These committees (around 60 as of 2009) working at different levels were cross-functional in nature, and according to the company, lent Cisco speed, scale, flexibility, and rapid replication.
Cisco had made the shift to this type of organizational structure in 2001 and had refined it in subsequent years. According to John T. Chambers (Chambers), the Chairman and CEO of Cisco, the company had reorganized to break free of the silo culture in the company prior to 2001, so that it could remain agile and innovative in a rapidly changing industry. The company felt that the traditional command-and-control model had lost its relevance, and the future would be about collaborate models of decision making. He also claimed that the new organizational model had served the company well and helped implement its aggressive growth strategy amidst the economic downturn.
Industry observers and organizational experts were divided in their opinion about Cisco’s organizational structure and approach to decision making. While some industry observers felt that such a model was effective, others felt that the management-by-committee approach would slow down decision making and impede innovation. Some experts were extremely critical of Cisco’s organizational model. But others believed that if Cisco could further refine the model by addressing some of the lacunae associated with it, it could very well be adopted more widely and be accepted as a radical management innovation.
Cisco was founded by a group of computer scientists, who had together designed a software system named IOS (Internet Operating System), which could send streams of data from one computer to another. Right from its initial years, Cisco had a flat organizational structure. Over the years, the company had brought about certain changes in its organizational structure focusing on cross functional teams…
Speaking about the organizations structure, Chambers, said, “Our organization structure leverages the power of communities of interest which we call councils which we believe are $10 billion opportunities, boards that we see as $1 billion opportunities and working groups. The idea for the new structure occurred during the economic down turn in 2001, when Cisco wrote off US$2.2 billion in losses. Realizing the Cisco’s hierarchical structure was preventing it from moving fast, Chambers started grouping executives into cross-functional teams…
In late 2008, while Cisco’s stock was witnessing a decline, analysts said that the company was still in a strong financial position with US$26 billion in cash. “Not only do we have the $26 billion, we now have 26 new market adjacencies that are not relevant to our revenue today, but they will be three to four years from now,” said Chambers. Some industry observers and analysts felt that Cisco’s organizational structure and its collaborative approach to decision making was an effective one – potentially the organization of the future. “Now instead of a small group of executives telling everybody else what to do, people have authority to figure out for themselves what to do.
However, some analysts and ex-employees of Cisco were not happy with the new organizational structure at Cisco. The structure led to chaos and slowed down decision making at times, they said. “Right now it’s chaos because there’s so much on everybody’s plate,” said Geoffrey Moore, a management consultant who has worked with Cisco. Chambers acknowledged that his critics could be right in their criticism of Cisco’s organizational structure and its approach to decision making. However, he said that the company had arrived at its organizational structure after giving a lot of thought to it, continuously refining it since it was introduced in 2001. In November 2009, speaking about Cisco’s future strategy, Chambers said, “The improving economic outlook combined with what appears to be a very solid execution on our growth strategy due to our organization structure and innovative business model enabled Cisco to move into 30 plus market adjacencies while reducing non-GAAP operating expenses by 10% year over year and also reducing headcount.”aa‚¬A¦.
Tips to answer the tasks:
CASE DETAILS:
Period: 2001-2010
Published Date: 2010
Organisation: Cisco Systems. Inc.
Industry: Information Technology
Countries: US ; Global
Consider key words like matrix structure, functional or operational structure and the like.
TASK -1
COMPARE: Cisco organizational structure.
The company use to organizational structure silo (flat) before use to 2001. But the company use to organizational structure cross (matrix) after use to 2001.
The company use to silo structure so the company communication is easily. but the company use to matrix structure so the company communication is difficult.
The company use to silo structure so the company work is hierarchic. But the company use to matrix structure so the company work is individual.
The company use to silo structure so the company is not made good product. But the company use to matrix structure so the company is made good product.
The company use to silo structure so the company is going to loss. But the company use to matrix Structure so the company are good profit.
CONTRAST: Cisco organizational structure
Silo (flat)
Cross (matrix)
This company is work hierarchic.
This company is not come to new idea made the product.
This company is same work of every people.
This company is made many IT product. But product is not good.
This structure is going to company loss to $2.2 billion.
This company is work of individual.
This company is come to new idea made the product.
This company is diffident work of every group.
This company is made IT product very good.
This company is made profit use to this structure.
TASK -2
ANALYSES: The company use to organizational structure silo (flat) before use to 2001.
The company use to silo structure so the company communication is easily. The company use to silo structure so the company is not made good product. The company use to silo structure so the company is not made good product. The company use to silo structure so the company is going to loss. This company is not come to new idea made the product. The company is same work of every people. The company is made many IT product. But product is not good. The structure is going to company loss to $2.2 billion. This reason company was decline stage. The company business process is slow. The company was going to market. The company sales are decline. So the company business performance is bad.
The company use to organizational structure cross (matrix) after use at 2001. The company use to matrix structure so the company communication is difficult. The company use to matrix structure so the company work is individual. the company use to matrix structure so the company is made good product. the company use to matrix Structure so the company are good profit. This company is come to new idea made the product. This company is diffident work of every group. The company is made IT product very good. The company is made profit use to this structure. The company use to this structure business performance is good. So the company work is improvement. The company is come to market. The company is financial strong. The company was made new product.In November 2009, speaking about Cisco’s future strategy, Chambers said, “The improving economic outlook combined with what appears to be a very solid execution on our growth strategy due to our organization structure and innovative business model enabled Cisco to move into 30 plus market adjacencies while reducing non-GAAP operating expenses by 10% year over year and also reducing headcount.”
TASK -3
Organization structures affect the individual behaviour at work. The individual behaviour at works affect the factorsaa‚¬A¦.
1. Flexibility
2. Motionvational
3. Authority
4. Scope / Idea
5. Environalment
6. Society
1. Flexibility: the company use to new organization structure .so the company employees are individual work do freedom. The employees work do end any time and go to home.
2. Motionvational: A group the works do end go home. So other group work is fast. So he is go to home. The employees performance is improvement of salary, promotion etc.
3. Authority: the company is made many products. So the company made product 1. So product 1 groups different. Product 1 any massages go to individual department. Product 1 groups any decision do them self
4. Scope / Idea: the company deviated the product different groups. The group made the product new idea. The product made new technology.
5. Environalment: the company in the work employees any cast. The employees do work in deviated. Employees are into the company happy for every people.
6. Society: the company is made in the good society. The employee is works in the company before give the company of money. The employees take the money and develop the your personality.
.
MERIT
TASK -4
Present and communicate the appropriate organisational structure and culture for the case in discussion. (M3.1)
This case in the company use to cross (matrix) organization structure. This organization structure company for very good. The new organizational structure at Cisco. The structure led to chaos and slowed down decision making at times, they said. “Right now it’s chaos because there’s so much on everybody’s plate,” said Geoffrey Moore, a management consultant who has worked with Cisco. Chambers acknowledged that his critics could be right in their criticism of Cisco’s organizational structure and its approach to decision making. However, he said that the company had arrived at its organizational structure after giving a lot of thought to it, continuously refining it since it was introduced in 2001. In November 2009, speaking about Cisco’s future strategy, Chambers said, “The improving economic outlook combined with what appears to be a very solid execution on our growth strategy due to our organization structure and innovative business model enabled Cisco to move into 30 plus market adjacencies while reducing non-GAAP operating expenses by 10% year over year and also reducing headcount. The company use to organizational structure cross (matrix) after use at 2001. The company use to matrix structure so the company communication is difficult. The company use to matrix structure so the company work is individual. The company use to matrix structure so the company is made good product. The company use to matrix Structure so the company are good profit. This company is come to new idea made the product. This company is diffident work of every group. The company is made IT product very good. The company is made profit use to this structure. The company use to this structure business performance is good. So the company work is improvement. The company is come to market. The company is financial strong. The company was made new product. the company use to new organization structure .so the company employees are individual work do freedom. The employees work do end any time and go to home. A group the works do end go home. So other group work is fast. So he is go to home. The employees performance is improvement of salary, promotion etc.
