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December 21, 2007 12:09 am
Cisco Systems’ long-term succession plans were thrown into turmoil on Thursday after Charlie Giancarlo, the networking company’s development officer, said he would quit to become a managing partner at Silver Lake, the private equity group.
Mr Giancarlo, a 14-year Cisco veteran and the company’s top strategist, had been seen as the most likely successor to John Chambers, Cisco’s chief executive.
“Charlie is too good for Cisco to lose,” said Inder Singh, an analyst at Prudential. “He has touched on or operated many different parts of their business. This will be fairly difficult for Cisco to explain and it will be difficult to replace him.”
Mr Giancarlo said that the decision to leave Cisco been a difficult one drawn out over several months.
His departure appeared to be driven in part by Mr Chambers’ announcement this year that he intended to remain chief executive for at least another five years.
“Do the math. I’m 50 years old this year,” Mr Giancarlo said. “I don’t know what the position will be in five years.”
His departure leaves Mr Chambers without a clear successor, according to Mr Singh. It follows the departure this year of Mike Volpi, another rising Cisco star who had also been viewed as potential chief material.
“They have a lot of people that probably will be groomed for the CEO position, but it’s not clear to me if there is anyone ready now. They’re all future prospects. You want to replace John Chambers with a John Chambers. It’s not clear that there’s anyone quite ready to take on that mantle.”
Mr Chambers sought to allay concerns over his succession plans on Thursday. “If there’s one thing we do really well as a company, we transition really smoothly through things like this,” he said.
He said Cisco would be making a decision about a new chief “at a minimum of three years and more likely five years out”.
“It is most likely [the CEO role] will filled by somebody from within, of which we have half a dozen candidates who we track at various points of their careers,” Mr Chambers said, although he declined to rule out an external candidate.
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