18 December, 2007

Find me, follow me, hide me

Dreamforce Report: the prophet margin of John Chambers



A capacity crowd turned out to listen to Cisco CEO John Chambers' keynote. What words of wisdom did he share?

John Chambers

By Chris Middleton

The network is the platform, and the old corporate hierarchies will be swept aside in the move to more collaborative working paved by software as a service (SaaS), Cisco CEO John Chambers told Salesforce.com’s Dreamforce jamboree.

As the single-minded CEO of the world’s largest enterprise supplier, Chambers made a surprising evangelist for a flatter, more collaborative way of working. But in his guest speaker slot at the event, he suggested that firms abandon the old “command and control hierarchies” that have characterised his and other large enterprises.

Chambers claimed he now favoured a culture in which everyone across the enterprise – from the mailroom to the boardroom, in effect – is free to innovate and contribute to the corporate vision, a suggestion that would leave many business leaders reading the small print of their retirement plans, given the number of successful IT giants built in the likeness of charismatic and controlling CEOs.

"It’s no longer about investing in ERP, it’s about doing it on-demand, you want it bought to the people who need it." John Chambers, CEO, Cisco

Walking prophet-like amongst the crowd, Chambers said a lack of innovation has characterised the past ten years of the IT industry, a period in which many a technology giant has continued pursuing the locked-in, proprietary business models of the mid to late twentieth century.

In fact, of course, there has been enormous, disruptive innovation over the last decade, but much of it has been in the consumer space led by the likes of Google, Facebook, MySpace, Bebo and YouTube, many of which are now part of the unwieldy portfolios of a small number of media giants – or which have become media giants themselves.

What Chambers was really signalling was a welcome, if long overdue, sign of generational awareness. Most potential employees looking to join successful enterprises today are people in their twenties who have grown up with an internet and diversified communications infrastructure that allows them to connect and share and collaborate at will.

However, when those same people enter the world of work, many find corporate IT systems that do not, and cannot, offer that same flexibility and opportunity to innovate, and such rigid hierarchies built on the old client/server model are frustrating and counter-productive. This has the potential to be a recruitment and staff retention problem in future.

Second wave of innovation

The “second wave of innovation,” said Chambers, was about moving away from “internet phase one, one person to one person”, and so the main challenge (or opportunity) for business is finding new ways to work together towards common goals. “You have to see this occurring,” he said. "You have to see it three five and seven years before it is obvious to the market, and position your company for were it’s gonna go.”

The way towards this was a “common open architecture, and IP for the future… it’s no longer about investing in ERP, it’s about doing it on-demand, you want it bought to the people who need it,” Chambers concluded. In other words, the difference is being locked in because you want to be, not because you have no choice, and he even went as far as saying that he has rebuilt his own business on the modus operandi of successful social networking sites.

"People are collaborating on the internet, regardless of the CIO." Bob Suh, CTO, Accenture

Put another way, leadership is no longer about command and control but about subject matter and expertise, and being able to call on that expertise 24/7 in a greener, more efficient, global model driven by such technologies as telepresence and SaaS.

Find me, follow me, hide me is going to be a way of life in this environment,” he said, but rather undermined his own argument by adding: “If we were a democracy then the whole of my management team would have voted against it.”

Of course, this is precisely the problem that many successful enterprises – and many unsuccessful ones – face in the on-demand world, namely that of management and culture. If the role of the CIO is moving closer to that of the CEO, by becoming more about innovation than information, then that is a huge cultural challenge to the boardroom, and an equally large management challenge to middle-ranking executives. This will be particularly true in risk-averse cultures, both in the sense of nations and of vertical market sectors.

After Chambers’ departure, a panel discussion offered a less evangelical perspective. Chairing the discussion, professor and author Nicholas Carr of MIT said: “Saas and utility computing in general will change the way companies organise their collaboration elements. IT used to be built on isolation, but collaboration in that environment is difficult.”

Bob Suh, CTO of Accenture, said that there is no question that the “consumer web” will move into the company. “People are collaborating on the internet, regardless of the CIO,” he suggested. “What’s happening is that the personal world and the work world are becoming confused together [sic] and people like it that way. E-mail is no longer a document transfer piece of software. I think what’s really happening is that many of customers grew up with technology in a social context and they expect that when they get to work. I grew up with technology as a corporate mandate.”

Eric Berridge CEO Blue Wolf offered the most balanced view. “The beauty of the SaaS model is the common platform that can be rolled out department by department,” he said, adding: “Saas companies could do better selling up the food chain… a lot of them are very niche applications.”