Wednesday, August 19, 2009

John Chambers, CEO of Cisco, on the Future of Management

"I've always believed those who are most successful owe an obligation to give back. But also- what I can now articulate- it's just plain, good business sense as well."


An excerpt from the interview (McKinsey Quarterly):

Business in society: Public–private partnerships

The Quarterly: Can you talk a little bit about what you see as the role of technology and businesses like yours working with city and national governments?

John Chambers: Okay. I’m going to break it into two pieces. The first is what we see working with governments, in terms of traditional business and how do you really prepare for the future. And the second is more in corporate social responsibility and public–private partnerships, if you will, being, I think, a model for the future around collaboration.
So, to the first part, when you talk about the future, you can talk about smart, connected communities. Intelligent urbanization: 500 million people moving into cities of the future.
Traditional cities: how do they evolve? What I call towns or small communities, and then all the way down to the rural environment.

Let’s just deal with the first one. When you talk to President Lee [Myung-Bak], of South Korea, or Mayor Ahn [Sang-soo], who’s the mayor of Inchon, which is really the economic city built outside of Seoul, they’ll talk about how do you combine a structure with the direction of government; with a developer, really enlightened developer who knows where they’re headed, how they’re doing it; with a Cisco, to be able to say, how do you create perhaps as much as 200,000 sustainable, incremental jobs? How do you contribute as much as somewhere between a half a point to the whole point of GDP growth for all of South Korea? How do you combine an architecture—which addresses everything from green initiatives, smart electricity, productivity, government services such as education and health care—to tie them back to other government services, to intelligent transportation, smart buildings. How do you do this architecturally? And the answer is, intelligent plumbing, combined with a visionary government leader, combined with a developer who would build it in. And that’s able to go all the way down through what’s going on in China and the Middle East, et cetera, and it gives you speed of an ability to move into that area.

You could then transition and say, “Well, John, I didn’t even know you knew what smart grids were.” Well, maybe six months ago I wasn’t even focused on it, but it’s one of our top priorities. And yet here, in a series of positioning, using councils and boards and working groups, we’ve moved from a player often people didn’t associate with smart grids to the top announcement that’s been done—in my opinion, world to date—which was with GE’s leadership and with Florida Power & Light’s leadership, with local government, in terms of the city of Miami, [when they] announced Energy Smart Miami, where they’re going to go in terms of, “How do you really use grid technology to make the cost of electricity over time cheaper for the employees?” To do it in a more environmentally friendly [way], to generate what they said is a 1,500-person job increase just in the one city, that could expand throughout the state and throughout the region? These organization structures allow for speed of change, which did not occur before, but they’re often with groups that have not worked together.

Then, over the corporate social responsibility: your ability to make a difference.

I started in the Middle East with King Abdullah of Jordan, an outgrowth of the World Economic Forum, where King Abdullah said, “John, I need partners to help me transition the country.” When Katrina hit Louisiana and Mississippi: how do we transform the education system? We put $90 million into the area—purely corporate social responsibility—21st-century schools, wiring the areas. Terrible earthquake in Sichuan province: it wasn’t just about giving back. It was, “How do you partner in a way that can change education and government?” We put $45 million into it. I’ve been back there twice physically, including just about three weeks ago, and once virtually.

It is those types of programs that, first, are the right thing. I’ve always believed those who are most successful owe an obligation to give back. But also—what I can now articulate—it’s just plain, good business as well. Wherever we’ve been good on corporate social responsibility, we’re almost always in the top ten places to work, which we are in every major country in the world. But also, the better we are in corporate social responsibility, it’s amazing how it transfers over to business success.

For the entire transcript, CLICK HERE.

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