Cisco’s ‘People Deal’ Exemplifies Its Cutting Edge Commitment To Employees

By Patrick Moorhead - August 22, 2018
Cisco Systems, under the leadership of CEO Chuck Robbins, is on a roll, after years of revenue stagnation. While infrastructure is still the lion's share of the business, the new focus and growth in software, security, and services is paying off. Last quarter, Q3/2018, 32% of revenue was recurring revenue, 29% was deferred product revenue, and 55% of software revenue came from subscriptions. While I can't say the transformation is complete, I can say that we are starting to see the fruits of that labor. Cisco’s “People Deal”. CISCO While obviously product and service innovation plays a huge role in this turnaround, there's another big secret ingredient—Cisco's ongoing effort to make a positive impact on people, society, and the planet. While a huge part of these efforts lies in Cisco's hugely successful CSR program (read more here), another critical facet of this is internal—creating a culture that attracts and retains the best employees. On that note, today I wanted to talk about Cisco’s “People Deal”—the promise the company makes to its employees and what Cisco asks in return. It’s all part of Cisco’s desire to redefine the employee experience. What is the People Deal? In the words of Cisco, the People Deal is “the culture Cisco wants and needs to lead in our industry and return to big growth.” I view it simply as what Cisco employees should expect of the company and what the company expects of its employees.  It’s a kind of a “magna carta” for the company, too. It’s a three-part promise. First, Connect Everything—Cisco commits to connecting its employees with personnel, information, and opportunities, while it asks its employees to connect with their peers to deliver positive outcomes that align with the company’s goals and customer needs. I see this as the company desire to have a team versus individual culture, relentlessly focused on the customer.  Cisco adds that focus on teams is with the strengths of individuals in mind...creating the best teams using the strengths of those team members. Cisco is promising employees to provide them with the resources, tools, and direction to make that happen. Second, Innovate Everywhere—Cisco commits to providing an "open and agile" environment that encourages employees to explore ideas and challenge norms while asking in return that employees "relentlessly pursue" innovation to create a better future.  I see this as the company’s desire to operate more like a fast and nimble startup, using “fail-fast” methodologies and to think “out of the box”. Cisco is promising to give the permission to experiment and ail, even celebrating failures. The third component is Benefit Everyone—Cisco promises to support employee development, appreciate individuals’ contributions, and positively impact the world with the company’s collective ability. In turn, Cisco expects its employees to live and embody the company’s global values and believe in its collective ability to “win together.”  I see this as Cisco’s desire to work with the highest levels of integrity and respect for the individual. Cisco is promising to support teaming and reward employees for behaving in a way that reflects Cisco’s value. How it all got started The People Deal began back in 2014 when two managers, in comms and HR in the UK. According to Cisco, they believed Cisco could do better and began to do their own work. Their HR leader supported them in the region, and they were given the go-ahead and noticed a disparity between the Cisco employee “experience” and the company's overall goals. These concerns got kicked up the ladder to Cisco's HR leadership team, who then tasked the manager to investigate the global Cisco employee experience across the entire company. Cisco employees were first surveyed and asked to define the milestones of their own respective experience—information which was then shared with Cisco leadership. Resources were then dedicated to each of the 11 “key moments” (sourced from employee feedback), which could include the likes of the first day of employment, the technology used, a life-changing moment, getting rewarded, etc. For example, if rewards had a gap, one potential solution could be giving employees a day off on their birthday.  According to Cisco, the idea for the birthday off came from employees and is simple yet means so much to employees still today. A huge part of all of this was establishing shared accountability between employees and the company, wherein Cisco sets clear expectations for employees. This, in turn, creates a sort of two-way responsibility for the overall employee experience.  Employees and the company are beholden to each other to live up to the People Deal values. How employees are using it While the People Deal is a new thing at Cisco Systems, it is already being weaved into the recruiting process and shared with desired recruits. According to Cisco, it is already being used in the lingo of employees. I can tell you this is true from my vantage point as my analyst relations handlers use it with me. I sense a sense of pride with the People Deal, which impressed me as this could be viewed as some “feel good” program that never really makes a difference. The People Deal is also making its way into employee-manager tools. While I will dive into this deeper in another blog, I found it interesting that Cisco doesn’t do annual performance reviews, but rather use a weekly check-in to inform frequent future-focused conversations about the work.  Cisco adds employees share what value they provided, an update on what they loved and loathed and a highlight of their priorities for the coming week. This provides opportunity for a leader to also comment and provide any insights. The “love” and “loathe” comments also can give a leader a heads up if there is something happening with an employee. According to the company, it is seeing improvements in culture surveys that they attribute, in part, to the execution of the People Deal. I attribute the fast program uptake to a few things, including the permeation of the program and lingo into key communication vehicles. These include monthly company meetings, executive messages and inside training materials. Wrapping up Attracting, managing, and retaining the best talent in high tech is hard. Competition is fierce, and it seems like everybody young and talented wants to work at the next unicorn startup. The People Deal is one of the key ways Cisco is innovating here. With its intentional culture of connection, innovation, and positive impact, I believe Cisco stands out from the crowd.  I give EVP and Chief People Officer Francine Katsoudas a lot of credit here for their innovation. The People Deal reflects what CEO and Chairman Chuck Robbins said about culture: “Our future as a company is going to be defined by how we drive our culture.”  This is not some feel-good statement. In Cisco’s case, I believe it will make the difference. Next, I will be taking a look at some of the technology tools used to make the People Deal a reality—stay tuned.
Patrick Moorhead
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Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.