At least on a superficial level, we all know some of tech’s greatest success stories: Apple, Google, Facebook, Airbnb, and many others, like Cisco. I was part of the Cisco team from a small unknown company in the early 1990s, through initial struggles, to hyper-growth and becoming the world’s most valuable company. A global internet icon, massive challenges, and layoffs during the internet bubble burst in the early 2000s. Eventually, Cisco rebounded to a less glorious yet solid growth and continued success as the leader of technology for the backbone of the Internet.
What is the secret to Cisco’s ability to get off the ground in the first place? Ability to move into an insane growth period for a decade in the 1990s and become a massive stable global company.
I can still recall my first contact and interactions with Cisco in 1992. I had already spent about ten years in the building and selling of computer networking equipment — evenly divided between Europe and the US. I worked with one of the great US companies in the 1980s, Hughes Aircraft, based in Los Angeles. This was my first experience with software and communication solutions on a large scale. Before working with Hughes Aircraft, I developed operating system software for Norsk Data in Oslo, Norway.
Cisco hit me like a “mindful storm” when I first walked in for interviews in the early 1990s. I had never felt such energy, drive, and excitement in my life before. I was almost knocked out by the feeling of a “hurricane” swirling within the company. It blew my mind from the first minute. Yet, it felt like they had a “calm in the eye of the storm.” I came to call it “somewhat organized chaos.” I’m saying “somewhat” because it’s not possible to build a startup into a unicorn like Cisco became and have a “fully structured organization and orderly execution.” It felt like the company lived and thrived on the “edge of chaos,” pushing every boundary possible.
How could such a “free-flowing” organization “operating at breathtaking speed” function at all and even create incredible business growth? The first and most important criteria for succeeding in such an environment is to have “the right people” and, of course, the timing of its revolutionary products just when the world “wanted” a global communications network. At the time, nobody knew they “needed” the Internet — in the same way, that nobody knew they “needed” a car before Henry Ford created one.
The company's founders, Leonard Bosack and Sandy Lerner had the idea and concept and built the first Cisco “router” in their living room in the Palo Alto area in the mid-1980s, but to get it to the broader market, the “right” people were needed.
A few years later, in the early 1990s, I met with the newly appointed Head of Cisco Europe at a restaurant at Brussels Airport after 4-5 initial interviews with others on the team. I later learned that if one interviewer said “no” to a candidate, that person would not be hired. A complete consensus was required, especially relating to cultural fit. One of the first things I was told was that “Cisco is slow to hire and quick to fire.”
What are the secrets to Cisco’s success in the early years with a seemingly chaotic and “on edge” organization? The keywords are people and culture.
First, a tech startup aiming to become a unicorn must bring in people who fit the culture, be able to handle tremendous uncertainty and speed, and have an internal “swim or sink” mentality. Knowledge and experience are second — a person’s cultural fit and attitude are the #1 criterion. The reason? Knowledge and experience are worthless if that person does not fit into the culture — in my experience, a person who doesn’t fit with the culture will quickly become a significant distraction, slow progress, and be decremental to the team no matter what other qualities they might have.
12 key pillars that worked exceptionally well for Cisco in the early years:
1. Focus on cultural fit and attitude when hiring (knowledge and experience second). It’s incredible what knowledge an employee can be trained for and gain quickly with the “right” attitude.
2. Give broad responsibilities and authority to execute the business strategy within each employee's area. If resolving a customer issue, the employee has full power to make any decision needed — as long as the rationale for the decision can be explained.
3. Never micro-manage but be very clear on each employee's expectations and authority.
4. To facilitate speed of execution, a rule was that if your manager doesn’t respond within 12 hours of a request for approval (when you must go outside of the authority given), then make the decision and the manager is responsible.
5. You must take risks. If you are not making mistakes, you are not taking enough risks, and if you are not taking risks, you are not the right person for Cisco.
6. Never lose alone. When you need help, i.e., on closing a deal and run into problems, bring in all necessary resources to support you, including the CEO, if required — if we still lose, we lose as a team and move on.
7. An employee will not be fired for losing a significant deal — only for losing alone.
8. No finger-pointing if a risk you took did not work out (but an essential lesson learned) or if we lost as a team. Quickly move on.
9. Acknowledge team members that helped you.
10. No matter how dire a situation or “screw up,” always act quickly and, if needed, ask for help. Escalate quickly within the organization. Trust must be part of the culture to make that happen.
11. If presenting a business practice outside of the norm or “screw up,” always have a “Get Well Plan” at the same time. I.e., if a salesperson needed to offer a discount outside of the “approved range” to a customer for a valid reason, present a “Get Well Plan” to get back to expected pricing.
12. No matter what role you have within the company, ask yourself, “how do I support sales today.”
During my tenure at Cisco, we acquired over 100 companies. It’s self-evident that all those acquisitions would not be successful. Cisco, as a company, needed to take risks. And risks we took in nearly every part of our company. In the end, those risks paid off big time.
In many companies, mistakes are frowned upon or, even worse, ridiculed. Building a unicorn is impossible if employees are concerned about taking risks, and everything needs to be “perfect” before acting. One of my key lessons from building Cisco is taking risks on all levels, learning fast, adjusting, and moving on to great success.
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