Cisco No. 2 Resigns At Critical Juncture - InformationWeek

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05:33 PM

Cisco No. 2 Resigns At Critical Juncture

Charlie Giancarlo was widely seen as the most likely successor to chairman and CEO John Chambers.

Networking vendor Cisco Systems is losing one of its top strategists and deepest thinkers at a time when the company is undergoing one of the biggest market transitions in its 24-year history.

Chief development officer Charlie Giancarlo, 50, widely seen as the most likely successor to chairman and CEO John Chambers, said Thursday he will step down at the end of the year to become a managing director at private equity firm Silver Lake. Giancarlo is the second top executive to leave Cisco this year, following the departure of CFO Dennis Powell.

Giancarlo's resignation comes as a surprise to most analysts and could be a blow to Chambers' much publicized strategy for what he calls "Cisco 3.0." At the Cisco C-Scape Global Forum in San Jose, Calif., earlier this month, Giancarlo took the lead in outlining the new strategy for a Cisco focused on providing all forms of business communication and collaboration to its enterprise partners. Chambers has long sought a way to move the company beyond its core "plumbing and transport" business of providing network infrastructure to large corporations.

"We're happy to sell more switches and routers," Giancarlo said in a presentation that immediately followed Chambers' introduction to the conference, "but this is about huge new markets being created. We're going to be moving from millions to billions of users."

Giancarlo joined Cisco in 1993 with the acquisition of Kalpana. The list of technology initiatives that he has launched and spearheaded since then comprises all the areas that Chambers is counting on to lead this transformation: unified communications, wireless networking, video, and telepresence.

Giancarlo has also played a key role in the reorganization of Cisco's top echelon into a seven-person Development Council that will drive the emerging-technology markets key to the company's growth strategy in the coming years.

"The Development Council is one example of how this new structure will drive collaboration to effectively address market opportunities, drive efficiency and quality, and foster innovation," Chambers said in a statement announcing Giancarlo's resignation.

Giancarlo's departure leaves the company with no obvious successor to the charismatic Chambers, who has said that he intends to step down as CEO in the next three to five years.

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