Cisco systems: telepresence and the future of collaboration

Please provide 4 answers to the 4 questions at the end after reading this case:

Cisco Systems: Telepresence and the Future of Collaboration

If you want to catch a glimpse of the future of knowledge

 

work in the twenty-first century, a good place to start is a

 

small family homestead outside Germantown, Illinois,

 

40 miles east of St. Louis. That’s where Craig Huegens, director

 

of architecture for networks, data centers, and unified

 

communication services at Cisco Systems, lives and works.

 

When Huegens moved there from northern California in

 

December 2000, it was for the most basic of reasons: He

 

wanted his newborn son to grow up around family, who now

 

live just five miles down the road. Nevertheless, it was something

 

of a revolutionary concept because Huegens was

 

Cisco’s first full-time IT telecommuter.

 

Back then, he got by using e-mail and Internet Relay

 

Chat, a primordial form of instant messaging. It took some

 

accommodation on the part of both Huegens and his colleagues

 

back in San Jose, but they made it work. Over the last

 

seven years, Huegens has become the spearpoint for the philosophy

 

and technology at the center of Cisco’s biggest strategic

 

shift since the tech bubble burst in 2001—“Cisco 3.0,”

 

as CEO and chairman John Chambers likes to call it.

 

Cisco 1.0 was all about getting people connected by selling

 

truckloads of routers and switches, and it made the company,

 

founded in 1984 by a small group of computer

 

scientists out of Stanford University, one of the fastestgrowing

 

in American business history. Cisco 2.0, Chambers

 

says, was centered on business process change—using all

 

that hardware and, of course, a few truckloads of new gear,

 

like information processing telephones—to drive innovation

 

and productivity gains.

 

Cisco 3.0 employs even more hardware and software to

 

transform business models, and Chambers, with characteristic

 

evangelical fervor, says it will fundamentally change the

 

nature of work, enabling productivity growth to soar back

 

into the realms last seen in the economic surge of the late

 

1990s. “We believe that productivity can grow not at 1 percent

 

or 2 percent, but 3 percent to 5 percent for the sustainable

 

future,” says Chambers in an interview in his office in

 

Cisco’s San Jose headquarters.

 

That’s an audacious vision, and it will be driven, Chambers

 

maintains, by the type of collaborative, Web 2.0 technology

 

that now keeps Huegens in touch with his team in

 

San Jose: interactive Web forums like wikis and blogs; IM;

 

interactive “teamspaces” mounted on WebEx (which Cisco

 

acquired in March for $3.2 billion); and above all, videoconferencing

 

and its big brother, telepresence, which is a lifesize,

 

high-def, multiple-screen system for face-to-face

 

meetings among users in multiple locations. The question is:

 

Is Cisco’s latest initiative just Videoconferencing 2.0, or is it

 

really something revolutionary?

 

The new emphasis on intensely collaborative technologies

 

at Cisco, a company that epitomizes the catchphrase

 

“eating our own dog food,” ups the ante for CIO Rebecca

 

Jacoby. She assumed that post just over a year ago and has

been the point person for rolling out telepresence and other

 

new-age tools to the demanding in-house customers at Cisco.

 

Jacoby, who’s been at Cisco for 13 years but is a selfdescribed

 

nontechie (she came up through the manufacturing

 

ranks), takes over at an interesting time. Not only is she

 

Cisco’s first female CIO, succeeding the semilegendary Brad

 

Boston, now senior vice president of the Global Government

 

Solutions Group, she is also helping to lead Cisco

 

through a transformation as radical as any in the company’s

 

24-year history. To do so, Jacoby says, Cisco is making itself

 

the test bed for the next generation of collaboration tools.

 

Like many Cisco executives today, Jacoby has a single-screen

 

telepresence unit in a small back room off her office in San

 

Jose. Since it began to roll out the immersive conferencing

 

technology in late 2006, Cisco has deployed telepresence

 

rooms in 160 of its offices worldwide.

 

When Chambers first talked to Jacoby about taking on

 

the CIO job, she wasn’t sure she really wanted the spotlight

 

that goes with being the chief IT executive for one of the

 

world’s most powerful and venerated IT companies. The

 

prospect of transforming the entire company, however, “was

 

irresistible to me,” she says. Jacoby realized that the conventional

 

role of IT—acquiring and deploying new technologies

 

and educating employees on using them—was now, at least in

 

part, flipped. “When you talk about the collaboration tools

 

out there, they’re not necessarily initiated by IT,” she says.

 

Much of what Jacoby talks about is hardly earthshattering—

 

she has become an enthusiastic user of video

 

blogs, or vlogs, she says—but its pervasive use at a company

 

of Cisco’s size and age is probably unusual. With a globalized

 

workforce of highly connected, tech-savvy users, the adoption

 

and learning flow both ways, to and from Cisco’s IT

 

group. Jacoby calls it “creating an environment of directed

 

participation,” in which the tools already being used by Cisco

 

employees are adapted, refined, and sharpened to drive innovation

 

and growth. “Our biggest challenge,” she says, “is

 

just keeping up with where these ideas are going and seeing

 

how we can participate in how they are shaped and focused.”

 

One of the initiatives Jacoby and her team have undertaken

 

is to create an online “communications center of excellence,”

 

where new collaboration tools—from wikis to vlogs

 

to telepresence—can be deployed, tested, and refined. Video,

 

she says, is “phenomenally effective,” particularly when communicating

 

with employees outside the United States.

 

Equally powerful has been Cisco’s I-Zone wiki, a companywide

 

forum for new business ideas launched not by IT but

 

by the Emerging Technologies Group, headed by Marthin

 

DeBeer. Live for 18 months, the wiki has produced 600 ideas

 

for potential one-billion-dollar-per-annum-size ventures

 

(the minimum level for Cisco to get behind a new business),

 

suggested by the company’s more than 61,000 employees.

 

Reflecting Chambers’s mantra that to lead the next

 

phase of the Internet Cisco must constantly reinvent its own

processes, the focus on collaboration has also spurred a reorganization

 

of the company’s hierarchy. Beginning in the

 

painful 2001 meltdown, when Cisco posted a net loss of

 

$1 billion, Chambers led a shift from the usual product, sales

 

and marketing, and other functional groups toward a more

 

horizontal, less command-and-control structure of “councils,

 

boards, and task forces.”

 

“The councils focus on $10 billion-plus opportunities,

 

the boards on $1 billion opportunities, and the task forces

 

are the implementation of any of the above,” Chambers says.

 

It sounds like a somewhat communistic way of reshaping a

 

$35 billion-a-year company, but for Chambers this new

 

structure is key to the company’s regeneration. “The first

 

few years were pretty painful,” Chambers admits. “It’s like

 

anything you do—usually it’s not the technology that’s your

 

limiting factor, it’s people, and getting them to change from,

 

instead of command and control, to collaboration.” Cisco,

 

however, makes its living leading technology changes, and

 

the key to Cisco 3.0 will be the most sophisticated and expensive:

 

telepresence.

 

DeBeer’s executive assistant, Margaret Hooshmand, can be

 

found almost every day outside his office in San Jose. Only

 

she’s not really there ; she’s at the Cisco office in Richardson,

 

Texas, and she bilocates via telepresence to the cubicle adjoining

 

DeBeer’s office. You can walk by (in San Jose) and

 

chat with her any time, and if you don’t remind yourself,

 

you’ll forget to ask her how the weather is in central Texas.

 

Telepresence was the first new product to emerge from

 

DeBeer’s Emerging Technologies Group, and it ramped up

 

in record time, from hiring the first engineer in February

 

2005 to shipping the first external system in December

 

2006. Among the design principles, or “Telepresence Rules,”

DeBeer’s team devised were: “People will always appear lifesize”

 

and “To initiate a meeting you have to do just one

 

thing,” for example, press a button on the handset.

 

If you look behind the curtain, as it were, you’ll see that

 

the whole thing runs through a single Ethernet cable. It’s a

 

superb piece of technology.

 

“Cisco is betting on a proprietary approach,” says

 

Michelle Damrow, head of product marketing for competitor

 

Polycom’s telepresence group. “We think standardsbased

 

communications will win eventually.” Indeed, Cisco

 

faces strong competition in this nascent market from the

 

likes of HP, which introduced its Halo telepresence system

 

before the Cisco product launched, and from videoconferencing

 

leader Polycom, which offers a high-end telepresence

 

system with merged, seamless displays, as opposed to Cisco’s

 

three-separate-screens approach. Damrow notes Polycom is

 

betting on a standards-based system that will interoperate

 

with any standards-based video codex on the market today.

 

The answer, as you might expect, is that Cisco believes

 

its installed base, its brand power, and its marketing muscle

 

will push enough TelePresence units into the market to allow

 

it to become the de facto standard.

 

Telepresence itself, says Chambers, will be offered as an

 

on-demand managed service at off-site locations for companies

 

that can’t or don’t want to invest in their own systems.

 

When interoperability among multiple vendors does come,

 

it will be on Cisco’s terms, not industry-imposed.

 

If that’s not quite Web 2.0 enough for you, well, welcome

 

 

to John Chambers’s world.Cisco 3.0: Coming soonto a threescreen,

 

 

 

high-definition, surround-sound theater near you.

 

1.What are the main business benefits of the collaboration

 

 

 

technologies described in the case?

 

 

2.How do these go beyond saving on corporate travel?

 

 

 

Provide several specific examples.

 

 

3.Michelle Damrow of Polycom notes Cisco is betting

 

 

 

on a proprietary standard for its TelePresence product,

 

while competitors are going with interoperability. Do

 

you agree with Cisco’s strategy? Why or why not?

 

Defend your answer.

 

 

4.Think about the I-Zone wiki described in the case,

 

 

 

Cisco’s forum for new business ideas, and its seeming

 

success in that regard. Why do you think that is the

 

case? Do these technologies foster creativity, provide an

 

opportunity to communicate already existing ideas, or

 

both? Defend your answer.