Cisco Zooming In On Digital Transformation, Cloud, Internet of Things (IoT) and Security
In its Fourth Quarter and Fiscal Year 2016 Earnings report released on August 17th, Cisco confirmed there will be reduction in workforce but the number is lesser than the rumored 14000 jobs. Chuck Robbins Cisco’s new CEO is in the middle of an organizational transformation to position the company for its next growth phase and the job cuts are part of that initiative. In a statement, Cisco said restructuring is necessary for cost optimization and prioritizing new areas such as digital transformation and other high growth initiatives.
Today’s market requires Cisco and our customers to be decisive, move with greater speed and drive more innovation than we’ve seen in our history. Today, we announced a restructuring enabling us to optimize our cost base in lower growth areas of our portfolio and further invest in key priority areas such as security, IoT, collaboration, next generation data center and cloud. We expect to reinvest substantially all of the cost savings from these actions back into these businesses and will continue to aggressively invest to focus on our areas of future growth. The restructuring will eliminate up to 5,500 positions, representing approximately 7 percent of our global workforce, and we will take action under this plan beginning in the first quarter of fiscal 2017.
Cisco is in a great position to transform companies digitally because much of digital transformation is based on data and data is dependent on network bandwidth and performance which is an area where Cisco is the leader. In March, Cisco launched the Digital Network Architecture (Cisco DNA) as an approach to networking designed for the digital era. According to Cisco, as customers embrace mobility, cloud, analytics and the Internet of Things (IoT) to digitize their business, IT teams are struggling to keep up with the ever-increasing complexity of the network, sophistication of security attacks and growing customer expectations. In an announcement in July, Cisco said it realized that traditional networks simply could not scale to meet the increasing demands of the digital business. A new network was needed for the digital era. A network designed from the ground up to be flexible, programmable and open. Cisco DNA is a move by Cisco to help IT address these demands by shifting to Software Defined Networking (SDN) and automated network infrastructure management.
In 2015, Cisco also hired Kevin Bandy in a newly formed Chief Digital Officer role. As per Kevin:
We’re well on our way to making Cisco the best example of a digital company. It’s a journey for every aspect of our business—from our systems and tools, to our engineering, to our people, and I am thrilled by the partnership, energy and commitment across the company. Driving a digital transformation is not automating existing workflows or layering new tools and technologies on top of traditional processes. It isn’t an IT strategy trying to catch up with a business strategy. It isn’t cloud, collaboration, systems or applications. And it isn’t just a technology issue.
In a blog, Inbar Lasser-Raab, Vice President, Infrastructure and Digital Solutions Marketing at Cisco writes the following on Digital Transformation and Cisco’s role:
You need a foundation that leverages a strong technology portfolio from the cloud to the data center and all the way to the end device. A foundation that is simple, automated, and secure across the board. One that connects people and devices in meaningful and secure ways. So IT can move fast to respond to the business. Only Cisco provides the network, security, analytics, automation, and collaboration needed to achieve higher operational efficiency, greater competitive advantage, and increased profits. I believe that we are just scratching the surface on what we can do to accelerate digital progress.
Internet of Things (IoT)
Cisco has been at the forefront of Internet of Things (IoT) and has made commitment to invest in this new area. The company’s IoT portfolio is a suite of products, solutions, and services providing connectivity, security, automation, and insights from the fog to the cloud that organizations can deploy right now. Cisco wants to enable customers to automate the process of connecting devices over a global network and automate the service lifecycle of IoT businesses by providing real-time visibility, control, and actionable insights. Cisco wants to layer in IoT security for end-to-end threat protection and simplified compliance from fog to cloud.
Cisco also acquired Jasper Technologies Inc earlier this year which will become the IoT Cloud Business Unit, under SVP/GM Rowan Trollope, IoT and Applications. Jasper’s IoT service platform allows enterprises to connect their devices – from cars to jet engines to implanted pacemakers over the cellular networks of top global service providers, and then manage and monetize IoT services. Companies can deliver global IoT services across multiple service providers through Jasper’s cloud-based platform.
Last year, Cisco hired cloud expert Zorawar Biri Singh as Chief Technology Officer and Senior Vice President, Cloud Services and Platforms. Under Singh, Cisco is transforming to a cloud solutions provider. Cisco is targeting Managed Service Providers with its Metapod, an OpenStack based private cloud solution for easy Infrastructure as a Service (IaaS) delivery in the enterprise.
In a blog, Xander Uyleman, Senior Manager, Global Partner Marketing writes:
Metapod is a remotely engineered and operated private cloud solution built for developers. Metapod radically simplifies the process of getting started by providing a bundle that includes the controller portion of your cloud and the SaaS-delivered operations service subscription. The bundle includes a fully validated combination of Cisco Nexus 9000 switches, ASR routers, and Unified Computing System (UCS) technologies so you have a simpler installation and more consistent user experience.
Cisco has also struck partnerships with technology vendors to enhance Metapod. Pivotal Cloud Foundry is a cloud-native platform that helps enterprises rapidly deliver new experiences to their customers. It makes it easier to build and deploy new applications quickly using any language or runtime, and various backing services. Apprenda Platform as a Service (PaaS) is a run-time layer on Metapod that transforms private data center assets and public cloud infrastructure into a policy driven, self-service, hybrid cloud to run .NET, Java, and Docker applications with ease. SolidFire is a scale-out, all-flash storage platform, built specifically for large-scale cloud infrastructure. SwiftStack solution delivers an Amazon S3 type object storage service on-premises to complement other cloud services provided by Metapod.
As per the earnings report, security is one of the key pillars for Cisco’s growth post restructuring. Cisco already has a strong line up of network security appliances. In June 2016, Cisco announced the acquisition of CloudLock Inc which will further enhance Cisco’s security portfolio and build on Cisco’s Security Everywhere strategy. CloudLock is designed to provide protection from the cloud to the network to the endpoint and also aligns with Cisco’s strategy to deliver more cloud based subscription services.
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