End of an era for Cisco may look similar to start of next one

Cisco's John Chambers will relinquish the CEO job before a self-imposed retirement deadline in 2016

Over 20 years at the helm of Cisco Systems Inc, John Chambers was one of the few non-founders of a technology company to survive Silicon Valley's boom-bust cycles.

He did it in the unglamorous business of building network equipment, with the lofty goal of transforming the way the world works, plays and learns. "Many people said 'Yeah right, a router company can't do that,'" he said during Monday's press conference announcing plans for Chuck Robbins to take over as chief executive officer. "We changed people's lives."

Now Chambers, 65, will relinquish the CEO job before a self-imposed retirement deadline in 2016. He's weathered criticism he didn't do enough to prepare Cisco for new networking technology and for making an ill-timed foray into consumer products by buying Linksys and the maker of Flip video recorders. Once the world's most valuable company by market capitalisation, Cisco's growth prospects have been hurt by its own bureaucracy and industry upheavals, including a shift toward using software and generic computers instead of brand-name routers and switches to shuttle Internet and corporate data.

But Cisco's stock was the sixth-best performer in the Dow Jones Industrial Average last year, which makes it a pretty good time for Chambers to go out on top. And since he'll stay on as executive chairman, the end of one era may not look that much different than the start of the next.

"I think he's leaving on a high note, if he's really leaving at all," said John Butler, senior analyst at Bloomberg Intelligence.

Over two decades, a successful track record and masterful sales pitches weren't enough to ward off the worst of the dot- com bust, the 2008 recession and intensifying competition. Still, a personal touch helped Chambers keep a firm grip on power.

He's long required lieutenants to let him know when any of Cisco's 74,000 employees faces a life-threatening illness or other personal tragedy. He tries to call some of these workers day, to offer help securing appointments with sought-after medical specialists or find some extra financial help from Cisco's coffers.

"John Chambers is revered at Cisco," said Barry O'Sullivan, a former Cisco senior vice-president who runs a start-up called Altocloud. "Everyone has a 'John story,' about something he did to help them. People relate to him in a very personal way."

Cisco hired Chambers for its top sales job in 1991, after he'd worked at International Business Machines Corp and Wang Laboratories. He lead Cisco to dominance by building an aggressive sales team and, as CEO, providing it with plenty of new products to sell by acquiring smaller networking companies.