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:
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.