Cisco Restructuring To 'Strongly Position The Company Against Our Competitors'

Cisco's enterprise networking and data center networking units will be combined, its cloud computing business will be renamed and expanded to include server products, and the tech giant is reshuffling leaders, according to an internal email obtained by CRN after a published report on Wednesday.

Cisco Systems is shaking up several of its business units, along with its leadership, to better address how customers are buying its networking and cloud products, according to an internal email obtained by CRN after a published report on Wednesday.

Cisco's enterprise networking and data center networking units will be combined, according to the email sent by David Goeckeler, Cisco's executive vice president and general manager of Networking and Security, which was first viewed and reported by The Information.

Cisco is also renaming its existing cloud computing business to Cloud Strategy and Compute and expanding the segment to include server products, the email explained.

“While I know these updates may seem like a significant change, it’s important to understand, this alignment will strongly position the company against our competitors,” according to Goeckeler in his email.

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"We are focused on the tremendous opportunities in front of us across cloud, automation, 5G, security and collaboration,” said a Cisco spokesperson. “To continue the great progress already made, we are making some organizational updates to our networking and security business. This changes will better align our development process with our customer's needs as they transition to a multi-domain approach."

In the midst of the shakeup, several Cisco executives are being reassigned, according to the email. Perhaps the biggest change-up is Cisco's Dave Ward, chief technology officer of engineering and chief architect, who will be stepping down from his post to take a new role inside the company. Roland Acra, senior vice president and general manager of Cisco’s Data Center business unit, will be his replacement, according to the email.

The soon-to-be combined enterprise and data center networking unit will be led by Cisco's Senior Vice President and General Manager of enterprise networking, Scott Harrell, who has spent the last two years leading the enterprise networking business unit and has an 18-year tenure with Cisco.

Liz Centoni, a 19-year Cisco veteran and current senior vice president and general manager of IoT for the tech giant, will be heading up the new Cloud Strategy and Compute business unit. Cloud computing's former leader, Kip Compton, will move to Cisco’s Networking and Security Business group, Goeckeler said in his email.

Cisco's network orchestration products, which are currently part of the Cloud Platforms and Solutions group, will become part of the Service Provider Business. Leading the group will still be Jonathan Davidson, Cisco's senior vice president and general manager of Service Provider Networking.

Cisco's restructure comes at a time in which the San Jose, Calif.-based networking titan is seeing some impact from a "challenging" macro-economic climate, according to Cisco CEO Chuck Robbins. Cisco's stock declined by 5 percent in after-hours trading following its Q2 2020 earnings call last Wednesday.

Cisco in recent years has felt the pinch in its data center business as more service providers virtualize their networks and are buying cheaper, white box gear. Many business customers are also moving to public cloud environments and out of the their private data centers.

A reorganization isn't a surprise, especially as more customers move to the cloud and evolve their IT infrastructures, according to one executive for a Cisco partner that did not want to be identified.

"We're not leading with Cisco today but we are using them as needed. We are also displacing Cisco in some cases," the executive said. "But no matter how many times they restructure, they are still the behemoth."

Cisco said it will not be changing any of its products in the wake of the reshuffle.