Reorganisation isn’t new to the tech multinational Cisco. It happened under its long-time CEO John Chambers and it is happening under its new CEO Chuck Robbins, although more swiftly, as he overhauls the business model itself.
Cisco makes network equipment like routers and switches and also the software to power them. These devices help in the transfer of information between devices that are part of a network. The company is now moving to a business where it is counting on software and subscription-based solutions to have a recurring revenue.
That means Cisco is doing away with some business, acquiring newer ones, changing reporting structures and letting people go. And all of this is manifesting in India, the company’s second and only headquarters outside of San Jose, California.
The Ken learnt that Cisco sold its digital software TV unit NDS to engineering company Larsen & Toubro (L&T) group around November, from three people familiar with the sale. It was an Israeli company that had about 2000 engineers in India. And Cisco paid $5 billion to buy it in 2012. (Cisco has been letting go of people from this division since 2014.) And with the deal, about 600 engineers also became L&T employees.
The networking giant is also shutting product lines gradually. The Mobile Wireless Group is one, and the small-cell technology group—cells that help bring mobile network capacity close to the user—is another, confirmed two directors, one former and another in the company. These divisions have whittled down from a 200-300 member team to a 20-30 size over the last two-three years.
“Every Friday, we would get news that someone or the other has been let go,” said a former senior executive, who quit in the second half of 2017. While accurate numbers of the layoffs in India are not available, at least two senior employees pegged it at 500.
And with the latest round of reorganisation, Cisco India will not have an engineering head anymore.
The last engineering head, Amit Phadnis, quit the company in January 2017, as staying on would have meant a diminished responsibility. His role has not yet been filled. As senior vice president, he was responsible for core engineering with close to 3000 people reporting to him.
But immediately after Phadnis left, at the all-hands meeting, it was announced that no one will be taking Phadnis’ position, said a Cisco director. The Ken spoke to five senior Cisco India executives to confirm this. All of them wanted to stay anonymous as they are not authorised to speak to the media. Phadnis did not respond to messages where he was asked for his viewpoint.
The resounding message to Cisco India from this is one that it no longer gets any special treatment and is like any of the other hundreds of ‘sites’ Cisco has across the globe.
