For Thousands of Years

Transcription

1 Jodi Krause

2 For Thousands of Years Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

3 mass distribution and long distances Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

4 Building a network of human connections...

5 The Evolution of Organization Structure Adapted from Thomas Malone, The Future of Work Wave 1 Small Businesses Wave 2 Corporate Hierarchy CEO Wave 3 Dynamic Networked Organization Div SVP Div SVP VP VP VP Independent Disconnected Centralized Command & Control Decentralized Collaboration

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7 Cisco s Transformation Lines Of Business Dynamic Networked Organization CEO Culture of Competition Culture of Collaboration SP Enterprise Commercial Small FY

8 Discussion Topics Cisco s Journey to a Dynamic Networked Organization Components of the Model Keys to Successful Implementation

9 Why Collaboration? Social networking and internet technology Globalization Economic uncertainty Quickly changing markets Mergers, partners & joint ventures Gen Y (Millenials)

10 Why Collaboration? How Employees Work Is Changing 63% of time is spent communicating and collaborating Collaborative work is more often virtual (35%) than face-to-face (28%) Technology Enables Mobile, Collaborative Work Styles 56% of work is done away from their office desk 24% of work is done from home 40% are not located in the same city as their manager 85% telecommute part of the time Source: Cisco Workplace Resources Work Profile Survey, Cisco Systems, Inc. All rights reserved. Cisco Confidential 10

11 A great wind is blowing that gives you either imagination or a headache. Catherine the Great

12 Productivity Redefined Economic Benefits of a Large Enterprise Operational Excellence The Power of the And Innovation Agility of a Small Organization

13 Where Cisco s Journey Began $1 OPEX = Revenue $2.06 Net Income $.18 Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

14 Crisis is the Mother of Invention Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

15 Creating Structural Agility Sales Engineering Services The Power of the And Operations Finance Communications Marketing

16 Evolution of Cisco s Dynamic Networked Organization: The Big Picture Command / Control Councils Councils/Boards/ Working Groups people people people 4 Councils 6 Councils 4 Boards 9 Councils 48 Boards ~100 Working Groups Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

17 Why Collaboration? Productivity Gains $1 OPEX = Revenue $2.06 $2.42 Net Income $.18 $.46 Market Share Leadership 2 Categories 9 Categories

18 Discussion Topics Cisco s Journey to Collaborative Management Components of the Model Keys to Successful Implementation

19 Critical Elements of a Collaborative Organization Design Shared Goals Team Structure

20 VISION Cisco s Evolving Value Proposition to Customers How Cisco Sustains Differentiation STRATEGY VSEM Communication Template EXECUTION Top 3-5 initiatives in support of Your Strategic Priorities 2-4 Years Months 5+ Years 2010 Cisco and/or its affiliates. All rights reserved. How you are measuring success METRICS Months Cisco Confidential

21 Transparent Decision-Making Drives Alignment Prioritization V Cisco s Value Proposition to Customers 5+ years S Strategic Priority X (e.g., grow or improve competitive advantage) How Your Council, Board, Function or Work Group Sustains Differentiation Strategic Priority Y (e.g., grow or improve productivity) 2-4 years Strategic Priority Z (e.g., drive growth) 2-4 years 2-4 years 2-4 years E List of critical initiatives, programs or actions in support of Strategic Priority X (above). List of critical initiatives, programs or actions in support of Strategic Priority Y (above). List of critical initiatives, programs or actions in support of Strategic Priority Z (above) months months months M Define the quantitative metrics used to measure execution progress and accountability, and what success looks like. Example Metrics: Define the quantitative metrics used to measure execution progress and accountability, and what success looks like. Example Metrics: Define the quantitative metrics used to measure execution progress and accountability, and what success looks like. Example Metrics: Y:Y Share of Wallet Y:Y Contribution Margin Y:Y Expense-to-Bookings Ratio Y:Y Growth Y:Y Market Share Y:Y Results per Employee Y:Y Customer Satisfaction months months months Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

22 Transparent Decision-Making Drives Alignment Prioritization V S E M Strategic Priority X (e.g., grow or improve competitive advantage) List of critical initiatives, programs or actions in support of Strategic Priority X (above). Define the quantitative metrics used to measure execution progress and accountability, and what success looks like. Example Metrics: Y:Y Share of Wallet Presentation_ID Cisco s Value Proposition to Customers AGREEMENT How Are Your We Council, on the Same Board, Page? Function or Work Group Sustains Differentiation Strategic Priority Y (e.g., grow or improve productivity) ALIGNMENT 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential 5+ years 2-4 years Strategic Priority Z (e.g., drive growth) 2-4 years 2-4 years 2-4 years Are Our Resources Creating Sustainable Differentiation? List of critical initiatives, programs or actions in support of Strategic Priority Y (above). List of critical initiatives, programs or actions in support of Strategic Priority Z (above) months months months Define the quantitative metrics used to measure execution progress and accountability, and what success looks like. ACCOUNTABILITY Who is Responsible Example Metrics: for Success? Y:Y Expense-to-Bookings Ratio Define the quantitative metrics used to measure execution progress and accountability, and what success looks like. Example Metrics: Y:Y Growth Y:Y Contribution Margin Y:Y Market Share Y:Y Results per Employee Y:Y Customer Satisfaction months months months High Low Degree of Collaboration

23 Organizational Structure: Cisco Councils Operating Committee CDO Sales Service OPS CMO Fin Ent Comm SP Small Cons Emerging Solutions Council Connected Architecture Council Emerging Countries Council Connected Business Operations Council Customer Relevance Innovation Operational Excellence 5 Segment Councils 4 Cross- Segment Councils

24 Small Business Council Members and Mission WebEx Engineering Services Channels Manufacturing Business Development Europe Sales Cross-Functional collaboration delivering Cisco s technologies and services to Small Businesses *Council Lead

25 Expectations of Leaders 9 Corporate Councils Leader Commitment: 30% of Their Time Role Set Strategy Establish Strategic Priorities (shared goals) Business Goals Contribution Margin Accountability/ Metrics 7 Corporate Functions Leader Commitment: 70% of Their Time Role Hold budgets Execute Company Strategy Productivity Expense / Bookings Accountabilty/ Metrics Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

26 Participation: Increased Breadth & Depth Operating Committee (15 People) 9 Councils (117 People) 49 Boards (557 People) 110 Working Groups (1232 People)

27 Discussion Topics Cisco s Journey to Collaborative Management Components of the Model Keys to Successful Implementation

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29 Critical Elements for a Dynamic Networked Organization Technology Sustainable Advantage Process Culture

30 Portfolio of Collaboration Technology IP Voice & Video Mobile Applications Telepresence Conferencing Enterprise Social Software Messaging

31 Cisco s Journey 4 Levers of Cultural Change From To Opaque Decision Making Transparent Culture of Competition Passive- Aggressive Leadership Constructive/ Authentic Culture of Collaboration Vertical Alignment Resources Portfolio Management Siloed Accountability Shared

32 Disciplined Collaboration W E E E E E E E E E E

33 Evolution of a Dynamic Networked Organization: Where are We Now? Speed, Scale, Flexibility and Replication Phase One: We Built a Culture of Collaboration V Organizational Structure S E Shared Goals Phase Two: Drive Alignment and Accountability Build Repeatable Process FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

34 Accountability Guiding Principles Organization Role Accountability Operating Committee Segment Councils X-Segment Councils Cisco VSE Segment VSE X-Segment VSE (Innovation/ Op Excellence) Holds Councils and Functions Accountable Segment Performance (Growth, CSAT, Share, Contribution Margin) + Market Adjacency Performance (CPAD) Incubation Performance + Operational Excellence across segments + Market Adjacency Performance (CPAD) Functions Function VSE Productivity and Performance

35 Clearly Defined Roles Council or Board Leader Role 51% of the vote Council or Board Member Role Makes commitments on behalf of their function does not have to ask for permission

36 Council & Board Effectiveness Study Which Councils or Boards are more effective, and why? How do we measure effectiveness? What are the best practices in Councils & Boards? How do we improve the effectiveness of the model?

37 Council & Board Effectiveness Framework

38 Percent Council and Board Membership (From Board Survey only) 100% 80% 60% 40% 20% 0% 31% 31% Sit on 1 Council or Board Research Notes: Number of Council and Board Memberships Sit on 2 Councils or Boards Average number of Council or Board Memberships = 3 16% Sit on 3 Councils or Boards 8% Sit on 4 Councils or Boards 12% Sit on 5 or more Councils or Boards 1% Don t know *Top 2 Box Reported (Those that are somewhat or much more effective) Base size: Total Base = 148 Percent 100% 80% 60% 40% 20% 0% Perspective on Council and Board Membership Don t know I m on too many 11% 1% I m on too few 20% I m on the right number Impact of Council and Board Membership* 88% 68% 88% Somewhat/ Much more effective at your functional role 68% 81% Somewhat/ Much more effective at your role on a Board

39 Collaboration Effectiveness Index Statement Boards Councils The personal investment I make in this Board/ Council s activities is rewarding Increased strategic alignment between Board/ Council priorities and the business functions Increased Cisco's ability to differentiate itself in meeting the needs of our customers/ partners Improved the quality of the decisions that are made within the Board/ Council 94% 91% 86% 89% 83% 84% 83% 82% Overall, this Board/ Council has been effective in achieving its VSE 80% 80% Created new sources of growth for Cisco which will be realized in the next 12 to 18 months Increased the speed with which decisions are made within the Board/ Council Celebrated the achievement of important milestones related to the Board/ Council s progress 80% 71% 72% 67% 70% 58% Effectively identified when to phase out a (Board or) Working Group 46% 49% Acquired the necessary resources (headcount or budget) to support the Board/ Council s priorities 43% 44%

40 Improvement Focus for FY11 and Beyond Data & Metrics Goal & Reward Alignment Portfolio & Investment Management Meeting Effectiveness & Decision-Making 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential 40

41 UESTIONS

42 Menu of Collaborative Management Practices 1. How to Get Started on this Journey 2. Leadership Expectations 3. Developing Next-Generation Leaders 4. The Lifecycle of a Team 5. Conducting Effective Meetings 6. Creating Goal & Reward Alignment 7. Measuring Success 8. Creating Community Through Technology End

43 Case Study: How to Get Started on this Journey

44 Developing a Dynamic Networked Organization Are you ready for it? How does the journey begin? Transformation case studies 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential 44

45 Developing a Collaborative Management Model Are you ready for it? Technology Process Culture Is there an influential executive sponsor who s bought into the concept? Is there a need for the organization to come together differently in order to be successful in the future? Are there some key leaders who already exhibit collaborative behaviors and can become role models? Does the organization hold people accountable for shared goals? Is there basic collaboration technology available (e.g. voic , , conferencing, and shared document spaces)? 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential 45

46 Evolution to a Dynamic Networked Organization Experiment Scale Transform Organizational value from DNO Individual Ecosystem Workgroup Chasm Another Chasm Scope of impact Return

47 Case Study: Leadership Expectations

48 C-LEAD at a Glance C Collaborate L Learn E Execute A Accelerate D Disrupt Working Across Boundaries Engaging Others Earning Trust Developing Self Developing Others Demonstrating Passion Empowering Teams Achieving Results Shaping Strategy Building Capability Promoting Innovation Leading Change

49 C-LEAD Leadership Transformation Reward Alignment with Rewards Measure Integration into Performance Management Enable Self-Assessment, Development Resource Guide, 360 Feedback Tool Educate Managers Meeting, Senior Leader Calls to Action, Website Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential Return

50 Case Study: Developing Next-Generation Leaders

51 Developing Leadership and Innovation Simultaneously Hogan assessment Individual coaching sessions There's almost nothing a leader cannot accomplish Baseline assessment if they do debrief not care with who coach? gets the credit. Leadership platform videos starring you(?) Transformational platform - John Chambers, Cisco Chairman & CEO Skip level development meeting Robust development plan update

52 Cisco Executive Action Learning Forum Activities Leadership Enterprise-level mind set Disruptive innovation framework Robust development (Assess, plan, discuss) Collaborative decision making with peers Executive coaches Innovation $1B+ business opportunities Residential Workshop Business partnership Top executive stakeholders Enterprise transformation Return

53 Case Study: The Lifecycle of a Team

54 Council & Board Lifecycle Model Work: Reach agreement on vision, leadership, membership, shared goals, roles and responsibilities Work: Translate shared goals into the organizational engagement needed to execute on priorities Work: Develop bold strategies and the organization s capability to achieve both operational excellence and innovation Work: Promote change and innovation to support Cisco strategy and set Cisco apart in the global marketplace Work: Assess completion of goals against current strategy and choose to reconfigure or disband Sign of Success: Clear Purpose Sign of Success: Committed Resources Sign of Success: Effective Prioritization Sign of Success: Positive Disruption Sign of Success: Healthy Evolution Sign of Distress: Disengagement Sign of Distress: Stagnation Distress: Overwhelm Sign of Distress: Critical Failure Sign of Distress: Irrelevance Start Up Align Accelerate Transform Reinvent or Retire Return

55 Case Study: Conducting Effective Meetings

56 Optimize Executive Meetings Goals Inform Engage Exchange Update Address issues Educate Discussion Build consensus Make a decision Share expertise Brainstorm / debate Reach agreement Timing 30 minutes 1 hour 1-2 hours Interaction 75% Presentation 25% Discussion 50% Presentation 50% Discussion 25% Presentation 75% Discussion

57 What format is best for the following types of meetings? Make Strategic Decisions Challenge Thinking Course Correct Educate Inspire Measure Progress Plan Inform 25% Discussion Engage 50% Discussion Exchange 75% Discussion

58 Speaker Expectations Discussion Type Type of discussion (Exchange, Engage, Inform) % time presenting and % time discussing Allocated Time # Minutes or Hours total Recommended # of slides Speakers Key Discussion Points Project Overview Update from prior meeting Project details Speaker Name What decisions do we need to make? Risks/Challenges Include the Following Slides Purpose and Desired Outcomes Project Overview/Update Details related to xxx Presentation Deadlines When due Where to send Return

59 Case Study: Creating Goal & Reward Alignment

60 People Drive Accountability A Council or Board strategic priority or execution activity must have at least one EVP/SVP/VP accountable to it

61 VSEM Publishing Process Transparent Goal Alignment Priorities Centralized in Performance Management Tool Return

62 Case Study: Measuring Success

63 SPEED FLEXIBILITY The Power of the And SCALE REPLICATION

64 Speed Oct 08 Vision Agreement Internet Routers in Space Oct 08 Strategy Alignment Speed of Innovation: Data, Voice, Video between satellites Nov 09 Execution Accountability Launch of first satellite router Sept 08 Smart Grid ~ One Year from Jan 09 End-to-End Grid Comm & Control System Apr 09 Vision to Execution Florida Power & Light/GE Aug 08 Smart + Connected Communities Feb 09 Blueprint Announced Apr 09 Gale International/ SongdoIBD Sept 07 Sports & Entertainment July 08 IP-enabled Sports Business Model Nov 09 StadiumVision Wins: Yankees/Cowboys Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

65 Scale Routing 58% Switching 70% Networked Home 43% Voice 30% Wireless: LAN 61% Storage: Area Networks 24% Digital Video: IPTV 65% Security 35% Web Conferencing 50%

66 Flexibility February August Days $500 Million Re-Aligned Faster, Better, Stickier Decisions Passive Aggressiveness November January Days $500 Million Re-Aligned Fiscal Year Days $1.5 Billion Cut from Cisco s Run Rate Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

67 Replication Expansion into New Markets FY07 2 Adjacencies FY10 30 Adjacencies 15X No Increase in Sr. Executive Time FY07 60 Days FY10 55 Days 1X Increased Breadth and Depth of Participation FY Executives FY Executives 13X

68 VSEM: 4-Page Dashboard VSEM Alignment & Accountability Council Leader MBOs Metrics Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential

69 Case Study: Creating Community Through Technology

70 Virtual Community Spaces: Council & Board Connection Presentation_ID 2009 Cisco Systems, Inc. All rights reserved. Cisco Confidential Return

71 UESTIONS

72 While hierarchies are not vanishing, profound changes in the nature of technology, demographics, and the global economy are giving rise to powerful new models of production based on community, collaboration, and self-organization rather than on hierarchy and control. Opening to Wikinomics by Tapscott & Williams, 2008

73 Thank you!