UPDATED 09:55 EDT / MAY 10 2011

Cisco’s Recovery: Management, Cloud, and e-Printing

John Chambers, the current CEO of networking behemoth Cisco, has put in place a council-based system in 2006 designed to boost cooperation between regional managers. This system, however, only slowed down the company and internal processes including innovation and financial development, becoming a major factor in Cisco’s decline in the past 12 months.

Throughout that period of four consecutive quarters, Cisco’s stock slid by over 30 percent. Now, after Chambers officially admitted Cisco’s troubles in a memo released a couple months ago, he has decided to dissolve this council-based approach. The company is also shifting its focus back to its core business, switches and networking equipment.

It seems that this reshaped focus will have to bring back Cisco to the heart of the industry’s current trends and movements, as the New York Times put it:

“…Cisco failed to keep pace with changes in the network switching and routing equipment, which accounts for nearly half its revenue. The industry has shifted from more standardized technology — a landscape in which Cisco thrived — to specialized equipment for various niche markets.”

Cisco is also cutting its underperforming divisions, such as its Flip business which it has closed – in the cost of 550 jobs and several hundred million dollars – just a few days before the launch of a new camera. Nevertheless, the company is still working hard on branching out to as many fields as possible. One example of that is the recent launch of its first datacenter container offering, its fresh partnership with Xerox.

Today, the companies announced they have struck a partnership involving both the cloud, and printing. Xerox will resell Cisco’s cloud storage technology, and Cisco will resell Xerox’s printing services to its clients as a part of its networking equipment. It’s important to note that this news shares a similarity with HP’s launch of a cloud printer, providing access to e-mail, Facebook and some basic web browsing options.


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